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Comments on news posted 2009-04-17 11:26:27: While yesterday's decision by Time Warner Cable to back off their extremely unpopular metered billing trial in four markets was a huge consumer victory, the phrasing of the company's announcement makes it clear that the debate is far from over. ..

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MyNameIsDanger

@ssimed.com
reply to myokitis

Re: More Populist ISP Bashing from BBR

While comcast, Cox, ATT, and Verizon spent millions of bucks rebuilding their infrastructure, TWC didnt... WHY should the customers be punished for that?? You obviously dont get it...



voipguy

join:2006-05-31
Forest Hills, NY
reply to six9

Re: Then just make it reasonable.

At $1 per GB, they could upgrade their network by delivering the data on flash drives.

Hey, maybe that's how they priced it?


dentman42
Premium
join:2001-10-02
Columbus, OH
reply to six9

said by six9:

I am not necessarily against metered billing. HOWEVER, it has to be reasonable. Second, there has to be an accurate way to measure usage at my router. One PC doesn't matter when you have VoIP, 3 computers and a DirecTV receiver all on the internet.

So how about a base price plus usage? Maybe $10 for the line and $0.25 per gb from there. I don't have any clue how much that would be for me, but I can almost bet it would be less than the $60 I pay now.

The problem I have with metering talk is the $1 per gb. There is no way that is an accurate measure of bandwidth cost.
Even $.10 per gigabyte is pushing it but closer. .25 = $1 per 4 gigs $10 per 40 gigs, $50 per 200 gigs, so a $60 bill for 200 gigs usage, and that includes both up and downstream.

jimbo2150

join:2004-05-10
Euclid, OH
reply to myokitis

Re: ISP/Video Competition

said by myokitis:

I understand where you're coming from. But that doesn't change the fact that both groups of companies are indeed intensely competing against each other for survival. It's just that your area probably isn't one of their primary battlegrounds.
I understand that, but you were also making it sound like the select few areas that they are competing equates to the entire (or at least a majority) of the market, which it does not. I just don't see the "ravenous" competition that they so often claim. For example: Just because they are competing in, lets say five, select markets... is it really necessary to claim stiff competition when the majority are not in areas with much or any competition? See my point?
--

- "Techie" Jim


maartena
Elmo
Premium
join:2002-05-10
Orange, CA
kudos:1

But.... don't you guys know that....

5 Gb is a whopping 500.000 emails, and 100.000 websites, and it is at least 500 songs!

5 Gb is HUGE!
--
"I reject your reality and substitute my own!"


lacklusterbb

join:2009-03-12
reply to dentman42

Re: Then just make it reasonable.

When we talk about TW profit, let's be clear, last year's annual report showed that the only 2 divisions in the company that made a profit were publications and cable. Of those 2, cable earned the most. Their other "investments"--AOL and entertainment--were the huge money losers. So, what TW really wants if for cable subscribers to subsidize their poor management of broader company activities.

IMHO, the spinoff of cable from the parent company this year was in great part positioning in anticipation of net neutrality arguments over their metered billing plan. They've got too many captive markets in cable (you don't see them trying to impose obscene rate hikes on their publications--they know that market is too competitive and that they'd lose subscribers). It's clear that something needs to be done in this country to keep our pipes open, innovation occurring, and the Internet (the creation funded by the US taxpayer) healthy in it's birthplace. I really think there needs to be restrictions about the pipes being owned by any entity related to a content provider, period. Greed is too strong a human motive to control.


myokitis

join:2004-06-19
Alexandria, VA
reply to jimbo2150

Re: ISP/Video Competition

said by jimbo2150:

... is it really necessary to claim stiff competition when the majority are not in areas with much or any competition? See my point?
I think I do, but it sounds like you're speaking in terms of %of geography, while the companies need to look at things in terms of %of customers (where their revenue comes from).

The current acquisition offers d'jour from select MSOs & Telcos are around $200 in value (cashback,credits, etc; I know of at last one major telco and one major MSO w/ offers like this), and the companies wouldn't be spending that $$$ to win customers from each other if they didn't think they needed to, if their management and shareowners weren't applying the pressure on their organizations to do so.

I think we'll just have to agree to disagree. This is a situation where "position determines perspective".


maartena
Elmo
Premium
join:2002-05-10
Orange, CA
kudos:1
reply to myokitis

said by myokitis:

said by jimbo2150:

said by myokitis:

a highly competitive environment
I highly disagree. I only notice decent to good competition in larger cities.
You obviously don't work for a MSO or Telco. Take it from somebody in the business: The level of competition is intense. They're desperate to win customers from each other, with employment (or lack thereof) implications depending on how the battle goes.

It's the difference between being an armchair quarterback and actually being in the game.
Sure, if you look at an area like the greater southern california area, where half of telco-land is owned by Verizon, the other half owned by AT&T, and where Time Warner Cable owns about 90% of the cable business.... (and 5% to Charter, and 5% to Cox, give or take) ... there is plenty of competition there.

I get calls from AT&T at least once a month (and they are allowed to do so as they supply one of my phone lines, thus existing customer) if I don't want to switch to their DSL service. TV ads from FIOS, Uverse, and Time Warner are slamming each other.

I never believed for one minute that in the greater SoCal area, they would ever introduce caps, as both Verizon and AT&T would have a FIELD DAY and rake in the customers.

But if you are living in a city like Boise, ID where the competition is a sub-par DSL provider that considers "standard" to be 1.5 Mbps and "ultra" is 3 Mbps, and the city is so widespread, with so many neigborhoods far away from any CO.... cable companies can easily introduce caps and get away with a whole lot more.


en102
Canadian, eh?

join:2001-01-26
Valencia, CA
reply to Simba7

Re: TWC = Ignorance

TWC = We're going to bill by the byte (as will Comcast, AT&T and others).. we just can't ram it down your throats for really high profits on it from day 1.

Eg. the 5GB-40GB 'standard' packages that would be netting TWC profit from day 1 would probably have to start off more like:

10GB (1.5Mbps or less connections)
100GB for 'standard' (6-10Mbps)
160 GB for 15/2 Mbps
250GB for the higher packages

I suspect that since TWC can't make immediate profits on the low end billing by the byte TODAY that it wants, it will do 2 things:

1. Raise rates (the 10Mbps/1Mbps 'standard' package will be probably $52/month now vs. $46)
2. Make the low end packages less attractive - the 1.5Mbps or less packages at +$30/month or require install fees, bundling, etc.
3. Offer an 'internet lite' package. Not 'true' internet, but have filters, caps, and all sorts of other methods to make 'lite' users happy and not cost much. Downside, being a 'not true' internet would be sort of old school AOL ish, with no access to bittorrent, etc. It would have to be sold as a unique service.
--
Canada = Hollywood North



Matt3
All noise, no signal.
Premium
join:2003-07-20
Jamestown, NC
kudos:12
reply to dentman42

Re: The Cable Television Industry should be regulated.

said by dentman42:

said by patcat88:

Not happening, FCC law prohibits franchising authorities and states from regulating it, and it bans itself from regulating it in CFR.
The FCC doesn't make laws.
The franchising authority can add whatever stipulations into the franchise agreement they want. That is the same effect as regulation.


en102
Canadian, eh?

join:2001-01-26
Valencia, CA
reply to djrobx

Re: More Populist ISP Bashing from BBR

I agree... indie ISPs have a tough time out there, but are willing to do this.

I am not against 'reasonable' caps either. TWC's caps are similar to that of wireless cellphone.
--
Canada = Hollywood North



jadebangle
Premium
join:2007-05-22
00000
kudos:1
reply to kaila

said by kaila:

If things are that hard and that complex, then TWC should quit the broadband business and get out of the way. Their stockholders will thank them.
Most of us do have a choice its called going back to dialup

You can get it for 5 to 10 bucks a month and there is no limit on bandwidth transfer

Beside if you can't use it for video, and if all you do is check your email and surf the web little bandwidth is sufficient
Road Runner, ATT both can go to hell :|


jadebangle
Premium
join:2007-05-22
00000
kudos:1
reply to maartena

Re: But.... don't you guys know that....

said by maartena:

5 Gb is a whopping 500.000 emails, and 100.000 websites, and it is at least 500 songs!

5 Gb is HUGE!
Thats only true if you compare it to dialup connection and take video content out of the picture...

bicker

join:2007-05-10
Burlington, MA

1 edit

The right way to offer metered Internet service

I think the mistake TWC made was replacing unlimited service. What they should be doing is creating a new, metered offering. Instead of $XX per month, make it 85% of $XX per month with a YY GB cap. Folks who normally stay under the cap will switch to the metered service. As time goes on, the prices for the two services will diverge according to the comparative value proposition each offers. As average consumption among un-metered customers climbs, then obviously the average value derived from the offering by those customers climbs, and so the price should climb (beyond inflation) commensurately. Meanwhile, the average value derived from the metered offering is effectively capped, so its price will not climb (beyond inflation).



jadebangle
Premium
join:2007-05-22
00000
kudos:1
reply to Mr Matt

Re: The Cable Television Industry should be regulated.

said by Mr Matt:

The cable television industry and all broadband services should be regulated the same way the Telephone Companies voice services are regulated. That way such abusive money grabs will be stopped.

Comcast just raised rates in this area. As a result of these increases my total monthly rate increase was $9.50 including taxes. In view of the fact that there is a recession the only way that Comcast can raise prices is that they are a quasi monopoly.

The most diabolical part about the price increase was the fact that they did not raise the price of their premium channels or broadband service. Why? Customers can drop any or all premium channels and still have cable service. Many customers can get DSL Service from the local telephone company so Comcast did not raise prices on that service. On the other hand Comcast did not match Embarq on the price of their economy broadband service which is $24.95 for a 768 Kbps download speed. Embarq offers 1.5 Mbps for the same price. I guess that Comcast wants to keep their economy service so lame that no one will order it.

Time to re-regulate the Cable Television Industry.
The only way to get their attention is to cancel service with them. I just will not put up with this and neither should you. Hopefully they will lose even more profit in the long run and we the consumer are the ones that are feeding them... we are master, they are servant. We win...

patcat88

join:2002-04-05
Jamaica, NY
kudos:1
reply to Matt3

said by Matt3:

The franchising authority can add whatever stipulations into the franchise agreement they want. That is the same effect as regulation.
The franchising authority's authority was created in the first place by the FCC. Any attempt by a local or state government to regulate something reserved to federal jurisdiction will quickly result in a cable company running to a federal judge and get instant strike down by a federal judge as the state or local government exceeded its scope/standing. States tried to regulate cellphone provider prices, plans, etc, ILEC style in the late 1980s, instant lawsuit, instant block by judge and jurisprudence that only the FCC can regulate cellphone providers, and states can only regulate it through commercial code or consumer protection code, not PUC code.


jadebangle
Premium
join:2007-05-22
00000
kudos:1
reply to bicker

Re: The right way to offer metered Internet service

said by bicker:

I think the mistake TWC made was replacing unlimited service. What they should be doing is creating a new, metered offering. Instead of $XX per month, make it 85% of $XX per month with a YY GB cap. Folks who normally stay under the cap will switch to the metered service. As time goes on, the prices for the two services will diverge according to the comparative value proposition each offers. As average consumption among un-metered customers climbs, then obviously the average value derived from the offering by those customers climbs, and so the price should climb (beyond inflation) commensurately. Meanwhile, the average value derived from the metered offering is effectively capped, so its price will not climb (beyond inflation).
You can't have both way, its confusing and unnecessary
wolves and sheeps don't dine together do they?
There are metered billing in 3rd world country and many ppl are not happy because: 1. the price for the service is pretty steep as is and 2. you have to pay more for bandwidth
Why would it be any different here in America where unlimited is what we have become accustom to?

jimbo2150

join:2004-05-10
Euclid, OH
reply to maartena

Re: ISP/Video Competition

said by maartena:

I get calls from AT&T at least once a month (and they are allowed to do so as they supply one of my phone lines, thus existing customer) if I don't want to switch to their DSL service. TV ads from FIOS, Uverse, and Time Warner are slamming each other.
Advertisements do not equal availability. Time Warner and Comcast advertise in my area but do not serve my house. They serve neighborhoods up north and south I think, and in my area is a smaller cable co, but as far as I can tell none of them compete with each other... only with satellite.
--

- "Techie" Jim

Lazlow

join:2006-08-07
Saint Louis, MO
reply to Combat Chuck

Combat Chuck

If you think TW has been looking ahead, you are deluding yourself. It has been obvious what direction the bandwidth usage has been headed for years. Yet, TW still has a ton of systems still running D1.1 and D2. If they had really been looking forward, a significant amount of their footprint would be D3 today.

All cable companies (or companies in general) have debt. Take a look at their 10k. After expenses they still made 4 BILLION dollars. Spend, say 1/3 of that, on network upgrades (today) and they will no longer have capacity issues for the next few years. You are correct in that the demand for more bandwidth will continue to grow. But the way to handle that is to plan for the future and provide the capacity for that bandwidth, not to try and stop it. Essentially what they are doing is like a car company selling a car that you can only drive 40 miles a day. If you want to drive more than 40 miles a day, they are going to charge you $1/mile. All trying to do stuff like this is going to accomplish is to drive customers elsewhere.

As far as other ISPs watching this; sure if customers are actually stupid enough to put up with this, they will want in on the action too. If customers will put up with it, any business would be foolish not to try something that will ten fold their profit margins. There is nothing in this that the ISPs have to do this.


Lazlow

join:2006-08-07
Saint Louis, MO
reply to bicker

Re: The right way to offer metered Internet service

Bicker

The problem with that idea is that the basics premise is off. Isp do not pay by the GB, they pay by peak Mbps. This applies both to transit costs and hardware costs. The only time that GBs actually cost something is during peak hours. During off peak hours whatever GBs are downloaded costs the ISP absolutely nothing (0) extra.

The other problem is that if they did this (on a cost based rate) all those people that do only download 2-3GB a month would find out how badly they have been ripped off for years. When Gigaom did a survey last year (Q2 2008) the the average of major US city ISPs were paying $10-$12 per Mbps per month for backbone transit. 1Mbps is over 300GB per month. That works out to under $.04/GB for transit costs. On top of this the technology is rapidly getting cheaper almost by the day, there are some vendors who are now selling bandwidth at under $4/Mbps (under $.01/GB). Cablevision stated last week that the upgrade to Docsis 3 was costing them between $70-$120 per customer. I think it is pretty safe that the D3 upgrade will safely carry them for the next three years (36months), which would mean a cost per customer of less than $3.34/month.



viperpa33s
Why Me?
Premium
join:2002-12-20
Bradenton, FL

Why don't they offer TRUE metered billing?

I don't understand why they don't offer TRUE metered billing if it's all about fairness? They say they should have a system like the electric company but don't apply it that way. They offer bread crumbs with packages that make people think they are getting a great deal with metered billing when they're not. Then they offer high bandwidth content hoping that people will go over there caps. The overage fees is going to bring in huge money for TWC.
--
"I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them" Thomas Jefferson



NetAdmin1
CCNA

join:2008-05-22
reply to myokitis

Re: More Populist ISP Bashing from BBR

said by myokitis:

Consider these factors:
- Demand for bandwidth is growing rapidly as customers use more bandwidth-intensive applications like video, and in the near future, HD video. This would certainly put strain on backend networks.
Without knowing what their "backend networks" are, how do you know that?

The problem isn't the "backend" networks, it is the last mile. DOCSIS 3 fixes that problem for the foreseeable future.
--
"This is a bus. You know how big a bus is?"

ElJay

join:2004-03-17
reply to Simba7

Re: at what point

That reminds me of the frightening ISP bills I ran up for my parents in 1996 back in the great days of hourly dialup billing.


six9

join:2001-12-03
Atlanta, GA

1 edit
reply to dentman42

Re: Then just make it reasonable.

said by dentman42:

Even $.10 per gigabyte is pushing it but closer. .25 = $1 per 4 gigs $10 per 40 gigs, $50 per 200 gigs, so a $60 bill for 200 gigs usage, and that includes both up and downstream.
I base my numbers on the assumption that Comcast gives me 250gb for $60. Note, I have to pay more because I don't have their TV service.

soothsayer15

join:2002-03-01
Irving, TX
reply to Lazlow

Re: ISP/Video Competition

said by Lazlow:

Combat Chuck

If you think TW has been looking ahead, you are deluding yourself. It has been obvious what direction the bandwidth usage has been headed for years. Yet, TW still has a ton of systems still running D1.1 and D2. If they had really been looking forward, a significant amount of their footprint would be D3 today.

All cable companies (or companies in general) have debt. Take a look at their 10k. After expenses they still made 4 BILLION dollars. Spend, say 1/3 of that, on network upgrades (today) and they will no longer have capacity issues for the next few years. You are correct in that the demand for more bandwidth will continue to grow. But the way to handle that is to plan for the future and provide the capacity for that bandwidth, not to try and stop it. Essentially what they are doing is like a car company selling a car that you can only drive 40 miles a day. If you want to drive more than 40 miles a day, they are going to charge you $1/mile. All trying to do stuff like this is going to accomplish is to drive customers elsewhere.

As far as other ISPs watching this; sure if customers are actually stupid enough to put up with this, they will want in on the action too. If customers will put up with it, any business would be foolish not to try something that will ten fold their profit margins. There is nothing in this that the ISPs have to do this.
Use the profit to upgrade the network and invest in the company's future? Probably won't happen. They will use the profits to pay out dividends and increase the value of executive stock options.

andre2

join:2005-08-24
Brookline, MA
reply to jadebangle

Re: More Populist ISP Bashing from BBR

said by jadebangle:

Most of us do have a choice its called going back to dialup

You can get it for 5 to 10 bucks a month and there is no limit on bandwidth transfer
And if you leave it running 24/7, you can download almost 15G/month which is 3 times TWC's lowest cap.


maartena
Elmo
Premium
join:2002-05-10
Orange, CA
kudos:1
reply to viperpa33s

Re: Why don't they offer TRUE metered billing?

said by viperpa33s:

I don't understand why they don't offer TRUE metered billing if it's all about fairness? They say they should have a system like the electric company but don't apply it that way. They offer bread crumbs with packages that make people think they are getting a great deal with metered billing when they're not. Then they offer high bandwidth content hoping that people will go over there caps. The overage fees is going to bring in huge money for TWC.
That is very easily answered. You electrical company charges a base fee of only a FEW dollars including local taxes, fees etc.... If you don't use ANY electricity whatsoever, you will pay a bill somewhere along the lines of $3 to $8, depending on city, state, etc you are in.

If we take $5 as an average, and because the cable companies are greedy and you have an expensive modem that you rent, we'll just double that to $10.

Now lets charge per GB at $1 per Gb. In order to reach the same income level that they have now, based on a $45 average price (some people have lite, some people have premium), they will break even ONLY if everyone downloads 35 Gb, OR the total amount of GB's downloaded by all customers combined equals or exceeds the 35 Gb per customer mark.

The reality is that - and these are GUESSED numbers - 80% of customers probably download less then 20 Gb, 15% downloads less then 100 Gb, and 5% downloads more then 100 Gb.

If one downloads less then 20 Gb in this scenario, the monthly bill will never exceed $30, and more often then not is probably around the $20 mark, which would mean that TWC would lose a HUGE amount of money.

Also, all utilities are regulated by the local government of the county or city. THEY decide what the rate is going to be, or at least what the maximum can be. Prices are heavily regulated. If broadband needs to be a utility, then the local government is going to want their say as well.

Bottom Line: They would lose a lot of money if they are operating it as a utility, and I don't believe we'll see a lot of investing if that were to be the case.

So no thanks, let the market decide, not some bureaucrat.


Combat Chuck
Too Many Cannibals
Premium
join:2001-11-29
Verona, PA
reply to Lazlow

Re: ISP/Video Competition

said by Lazlow:

Combat Chuck

If you think TW has been looking ahead, you are deluding yourself.
You're deluding yourself if you think that looking ahead is limited to the goal of figuring out how they can provide more bandwidth for you. They're looking at money, it's fairly clear that Time Warner cares little about their front end infrastructure.
--
Come let us reason together.

Lazlow

join:2006-08-07
Saint Louis, MO

Combat Chuck

You really do not understand how business works do you? In a consumer based market, if you do not keep up with what the consumer wants, you are going to loose customers. Loosing customers (in significant numbers) means that you are loosing money. The only reason companies reinvest in their infrastructure is so they can continue to be competitive. Fios did not come into play becuase it was a "cool" idea. It came about becuase it was obvious that ever increasing amounts of bandwidth were the direction things were/are headed. Cablevision understood this too (which is why they have 30Mbps D2 available today). Comcast even understands this, as evidenced by their rapid (relatively) switch to D3(despite their official caps, there has been no significant amount of action done to those that have exceeded the caps). Even Charter (broke as they are) recognizes that they have to offer more bandwidth (slower switchover to D3).



Chris H

@cerner.com
reply to jimbo2150

Re: More Populist ISP Bashing from BBR

Hell, even then there isn't. I live in Kansas City Mo, and TW is the only cable game in town.