The telecoms regulator said that ISPs must ensure that they provide as open and neutral a service to users as possible. Ofcom accepted that some "traffic management" techniques are necessarily used by ISPs to ensure an efficient service, but said that ISPs must leave enough spare network capacity to deliver a 'best efforts' service, where access is generally "open" and "equal" for users. ISPs engage in traffic shaping, or traffic management, to ensure that one user's heavy use of a network for downloading material does not prevent another user of that network from being able to perform basic tasks such as sending or receiving email or looking at web pages.
"We would be concerned if network operators were to prioritise managed services in a manner that leaves insufficient network capacity for 'best-efforts' access to the open internet," Ofcom said in a report on its approach to net neutrality. (39-page / 235KB PDF)
"In such circumstances we would consider using the powers which allow us to safeguard 'best-efforts' access to the open internet by imposing a minimum quality of service on all communications providers," it said.
Net neutrality is the principle that an ISP will deliver all content requested by a customer equally, not allowing content producers which pay it to have preferential access to its subscribers. Controversy over net neutrality has been most prevalent in the US where some telecoms companies have said that content producers should share the cost of network building and maintenance. Opponents of that view claim that subscribers' fees to ISPs should buy them access to all information equally, not to a service in which some content is prioritised because of deals between ISPs and content producers.
In its report Ofcom said that it did not have a "general objection" to "vertically integrated operators" restricting access to their networks, but said that such activity must be the product of a market where there is "genuine competition and rivalry among firms".
"In such circumstances, we do not necessarily regard the blocking of services provided by competing providers, or discrimination against competing services, as being anti-competitive," Ofcom said.
However, the regulator said that it does have a "specific concern" about traffic management measures being implemented where information about the activity is not transparently disclosed to users and where the activity overly restricts the provision of a 'best efforts' service.
"Our stance as a regulator is therefore that any blocking of alternative services by providers of internet access is highly undesirable," Ofcom said.
"Similarly, whilst we recognise that some forms of traffic management may be necessary in order to manage congestion on networks, we expect such traffic management practices to be applied in a manner which is consistent within broad categories of traffic. Where providers of internet access apply traffic management in a manner that discriminates against specific alternative services, our view is that this could have a similar impact to outright blocking," it said.
Ofcom said that it is happy to rely on the market to ensure that traffic management is legitimate and not discriminatory but that that strategy was dependent on ISPs being transparent with consumers "as to the nature of the services they offer".
The regulator said that ISPs are not currently providing users with enough information about their service and the traffic management they carry out. ISPs should provide consumers with information containing details about the average speed of their service, how traffic management may impact upon "specific types of services" and be up front about what "specific services" are blocked "resulting in consumers being unable to run the services and applications of their choice," Ofcom said.
Ofcom said that ISPs should collectively try to use the same simple terminology and generally avoid using claims that refer to the provision of 'internet access' where the service is anything other than unrestricted.
"It is possible that providers may seek to market a restricted service as 'internet access' by caveating this with a description of the restrictions they have put in place. Consideration needs to be given as to whether this practice is acceptable. We believe this will depend, at least in part, on whether consumers would be able to make sufficiently informed decisions based on such a formulation or whether, in practice, the risk of consumers being misled about the service they are buying remains unacceptably high," it said.
Ofcom said it welcomed a self-regulatory approach to providing users with information on traffic management which a number of major UK ISPs signed up for earlier this year. BT, Virgin Media, TalkTalk, Vodafone, O2, BSkyB and Three all agreed to a standardised approach to publishing information on how they shape their network traffic in March. However, the regulator called for key facts on traffic management policies disclosed under the scheme to be less "technical" and more "accessible and understandable" for consumers.
Ofcom said it may risk regulatory intervention in the mobile internet market where it said blocking of services by operators is "widespread and persistent". The regulator said it would "monitor closely" as the market develops "whether the benefits of intervening outweighed the risks".
Consumers should also be able to switch suppliers more easily, the regulator said. It wants ISPs that are unable to "provide an appropriate level of information on traffic management policies at the point of sale" to provide subscribers with a "cooling-off period". During that time customers should be able to cancel their contracts, or change packages to ones that better suit them, without incurring extra costs.
ISPs should also notify customers about "material changes" to their "traffic management policies ... as quickly as reasonably possible" and give them the option to switch packages or even service providers if the changes will have "a significant impact on the service," Ofcom said.
In the EU there are no explicit laws on net neutrality, but recent changes to the Framework for Electronic Communications Directive set out certain requirements for national regulators to promote the concept.
Under the Directive EU member states must ensure that national regulatory authorities "take all reasonable measures" proportionate to "promote the interests of the citizens of the European Union by ... promoting the ability of end-users to access and distribute information or run applications and services of their choice".
Other rules set out in the Universal Services Directive must ensure ISPs provide consumers with "comparable, adequate and up-to-date information for end-users on the quality of their services" as well as "transparent and up-to-date" details on prices, tariffs and contractual terms and conditions.