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Comments on news posted 2013-01-18 10:27:04: For years the cable industry insisted that they imposed usage caps because network congestion made them necessary. ..

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Binghamton, NY
reply to morbo

Re: Yeah, let's just ignore the access charges

said by morbo:

I'm glad you admit that this is strictly about milking the subset of customers that consume above average resources for no other reason that "we can" and a mistaken understanding of costs associated with the above average use.

It doesn't matter what the cost differential is, you can't dispute the fact that someone who has an average bitrate of 5mbit/s (just to pick a number) imposes a greater cost on the ISP than someone with an average bitrate of 100kbit/s. The former requires more infrastructure investment than the latter, yet people defend pricing plans that charge them the same amount of money.

From a business standpoint this policy is hard to argue with. They alienate a tiny slice of their customer base, which happens to impose the greatest cost on them, and they either monetize them or get them to reduce their cost/leave the network entirely. It's a win win for the ISP from a business perspective, and I'd probably be doing the same thing if I was running an ISP.

Greenville, TX
reply to IowaCowboy

Re: Why should Netflix undercut cable

You sound like the European ISPs that want companies such as Google to pay for their network upgrades..

The user chooses what they use their data for. Here in the US of A, that's almost breaching net neutrality...

Netflix already has to pay for their own bandwidth costs. The only way Comcast, etc. would get $$ from Netflix is if they had direct peering in a datacenter and it went straight onto Comcasts network. Do they already do this? Hell if I know. Either way, it's not up to Netflix to pay for Comcasts stuff.

Digital Plumber
Minneapolis, MN
reply to morbo

Re: Yeah, let's just ignore the access charges

said by morbo:

The problem is that the caps are mostly arbitrary and used in an anti-competitive way to limit competition from streaming content.

Yeah, yeah. We've all heard the blanket statement repeated over and over again on this site.

How many services really compete head to head?

At best, online services chip away at sections of what is available via broadcast TV, but there is not a wholesale replacement option. It's not because of bandwidth caps; it's because anyone with a clue about how that infrastructure is built knows that you can't scale to 100+ million simultaneous Internet video feeds using technology available today.

Caps aren't the reason that service doesn't exist, no matter how badly you want that to be cause.

said by morbo:

If the caps were at least updated annually or on a rolling schedule based on average consumption increases then this wouldn't matter.

Technology refresh cycles are 3-5 years, which is about the rate you're seeing access speed increases and bandwidth cap increases.


reply to IowaCowboy

Re: Why should Netflix undercut cable

said by IowaCowboy:

Comcast owns their lines and infrastructure. They charge a modest price for TV service and that pays the salaries of hard working individuals maintaining the infrastructure that carries TV, phone, and Internet. I don't think Netflix should get a free ride on Comcast's lines as I call that unfair competition. If it was not for Comcast offering TV service, we'd be paying three times as much for Internet. Competition is good, but when you severely undercut a competitor and get a free ride on their infrastructure, I call that unethical competition. I think the FCC should seriously look at IPTV services and make them adhere to the same regulations that cable/satellite/broadcasters must adhere to. I pay a good chunk of money to Comcast each month for my triple play and cord cutters are going to cause that cost to go up as they still have the cost of maintaining infrastructure but are losing the money to pay for it and broadband prices will go up and quality will decline.

I think Comcast should waive caps if a subscriber gets expanded basic or above or Netflix should have to pay Comcast and other pay TV providers for use of their networks.

Comcast owns the lines and infrastructure. Comcast's subscribers pay inflated flat rate pricing for residential and commercial services that cover costs associated with bandwidth, maintenance of infrastructure, and capex, while still generating additional revenue for operations/labor and shareholder's dividends.

Comcast subscribers ALREADY paid for their bandwidth. If a Comcast internet subscriber chooses to pay for Netflix out of their own pocket, Comcast has no right to impede or otherwise interfere with a competitor's traffic or services requested by and routed to a Comcast internet subscriber. Comcast has no right to demand anything more.


Who cares.

Who cares what the reasons are or supposedly are. All that matters is that they exist.

Iowa native
Springfield, MA
·Verizon Broadban..
reply to LightS

Re: Why should Netflix undercut cable

While I think the concept of Netflix is a good idea, I just think they should play fair competition with cable and not be the reason for the hundreds of thousands of cord cutters every quarter. What I am also saying is they should have to adhere to the same regulations as cable such as the public access requirements and community programming. What I don't think is fair that cable has a lot of regulations and Netflix has none. And cable employs people who live in your community, Netflix probably has their servers overseas.

I subscribe to cable, and always will.

Final thought: either deregulate cable or make IP video services adhere to the same regulations as broadcasters and cable providers. What I don't like is Netflix's ability to seriously undercut traditional TV providers that own infrastructure.

Comcast charges more if you have Internet only to make up for the lost TV revenue. Comcast still has the same labor and cable plant costs if you are an HSI only subscriber or subscribe to their Xfinity Triple Play Complete (their highest level of service) although the programming costs vary based on the number of subscribers of that channel.

Greenville, TX
I think our opinion regarding Netflix differs though - I personally like Netflix (even though I'm not a subscriber anymore) because it's different. I could care less how much it costs - I like that there are options, that you can stream movies on demand, and no ads.

As far as that goes - Netflix is not a cable ISP. They entered this business to provide IPTV & frankly, they're doing a good job.

Also - It's pure greed IMO by the ISP. They made contracts with content providers - if everybody cuts cable, who's fault is that if they lose revenue? Not the consumer, that's the ISP. They then need to figure out a way to recover their subscribers. If they can't, they deserve to not be a provider any longer.

reply to IowaCowboy
It is similar to the Internet radio vs. broadcast radio battle. One has few regulations, the other has considerable regulations. It won't change anytime soon, probably never. The older technologies were supposed to serve the community. The newer ones have no such obligations.

reply to LightS
It is the content owner's fault more than the cable operator/ISP's. The content owners make the rules. Operators can't do anything about it. Cable operators would like for their rates not to go up as much as their consumers, but that's not an option when content owners want double and sometimes as much as 5 times what their previous contract required.



This made me laugh

Comcast owns the lines and infrastructure. They charge a modest price for TV service and that pays the salaries of hard working individuals maintaining the infrastructure that carries TV, phone, and Internet.


Hazelwood, MO
reply to Crookshanks

Re: Yeah, let's just ignore the access charges

I can dispute your use of the word "greater" as a person that has an average bitrate of 5mbit/s has a very marginal cost over someone that uses 100kbits/s per second and that is a fact.

Qwest exec

reply to Scree

Re: In other news...

If you're willing to pay it, it's not too much.




@ Grandmothers for $15/mo. That's true, if it were about fairness, they would have options. And they would hit the unlimited plans at or around $60/mo if they offered 50+mbps speeds with unlimited use.

Chanhassen, MN

This is why prices go up to a T.

»www.npr.org/templates/transcript ··· 69413848

"Employees want higher wages and better benefits and better working conditions. Suppliers want to give fewer discounts and want you to pick up more of their products. Communities want more donations. Governments want higher taxes. Investors want higher dividends and higher stock price. Every one of the stakeholders wants more. They always want more."


Brooklyn, NY
·Optimum Online
·Verizon FiOS


Maybe it's time for inflation to give a $5 boost to tiers.. but in exchange there should be speed bumps as well.. and primarily the cable companies have been stingy with the upstream bandwidth as much as every other telco NOT on fiber is with the downstream.. There is no good reason why every service provider shouldn't be at 50 megabits down/upstream for $1 per megabit unlimited service. Of course it's a pipedream.. but apathy, corruption and industry gluttony fests abound on why you pay more for less. Afterall the USA is only a bit short of 4 millions sq. miles and a good % of that isn't even where people live.. most of the population are in cities..
»en.wikipedia.org/wiki/United_Sta ··· d_States

This cap & overage thing was allowed to go on for far to long in the wireline business. WIRELINE BROADBAND internet is NOT a service that should be metered like wireless data, or other rediculous pricing schemes such as what you pay for OEM printer ink, gasoline, fedex overnight shipping rates, etc..

Monticello, NY
reply to Qwest exec

Re: In other news...

We're going to start charging for oxygen. $100 a breath. Since you want to live and all you'll be willing to pay so it's not too much!


reply to Qwest exec
Indeed, because Americans have so many choices. Oh you mean it's 'your choice' to use electricity or running water.


Hood River, OR


Ahh crap the Mayans may have just had the date wrong


reply to Skippy25

Re: Yeah, let's just ignore the access charges

said by Skippy25:

I can dispute your use of the word "greater" as a person that has an average bitrate of 5mbit/s has a very marginal cost over someone that uses 100kbits/s per second and that is a fact.

The additional cost of the heavy user is only negligible while the node has extra capacity.

As soon as the node hits capacity, the next bit costs thousands of dollars, for the additional equipment to split the node. And that's assuming you've got unlit fiber available in your existing plant.

As soon as you run out of fiber to do logical node splits, the next bit costs tens of thousands of dollars. You have no choice but to run new fiber to the new nodes.

Now, who pays for it? Do you make grandma pay the same amount as the heavy downloader? That's unfair, because grandma didn't max out the node. Wouldn't it be fair to impose a surcharge on the heavy downloaders, so that they end up paying all of the costs of the additional infrastructure?

You can argue that the caps are too low, or that the price of the surcharges is too high, or that there's no off-peak free-use period. Indeed, the cable industry would have a much easier time justifying the caps if they were to have a separate -- and much higher -- cap for off-peak usage.

But you cannot just blindly argue against caps, as so many do on the DSLReports forums, unless you deliberately ignore the fundamental economics of Internet service. "Bits are almost free!" Yes, but there's an asterisk -- they're not free when the pipes get congested.



Bottom Line

The bottom line is I want a pipe to the Internet. This is what I pay for. I don't want it capped. I don't want it filtered. If Comcast, Verizon, AT&T, et al want to compete with Netflix, then they should do so. But there should not be a relationship between streaming video or any other content and the Internet Service Provider. I'd like to see the day when the Internet is this ubiquitous, high speed, high performance network that all services are delivered over. Streaming Video and Audio, Telephone, etc. The ISP's deliver the pipe. And anyone who wants to deliver content compete against each other, all delivering content over IP using the Internet.


·Frontier Communi..
reply to AndyDufresne

Re: This is why prices go up to a T.

You forgot something
The average CEO of a major corporation in the U.S. was paid $15 million in 2005, and the figure has climbed dramatically since then. The average U.S. worker's salary in 2005 was $40,000 and it has actually declined during the recession to approximately $34,000.00 Susanna Km writing an ABC News article just a week ago, said the average CEO pay increased 14 percent to $12.9 million in 2011, 380 times that of the average worker, following a 22.8 percent rise in 2010.The U.S. stands out, compared to other areas in the world with respect of CEO compensation.
Not going to provide a link, just google are CEO salaries out of control?



2 recommendations

reply to MovieLover76

Re: Yeah, let's just ignore the access charges

said by MovieLover76:

it's a huge accomplishment that the opposition had so much proof the network congestion was a farce that they finally had to come clean and admit it.

Congestion would become very real and a very expensive problem to fix if all incentives to moderate usage and artificial speed bumps were removed while people are still expecting dedicated-like performance.

Building the network just to reach the customers is expensive but bulking up the network to sustain high concurrent usage at high speeds quickly gets expensive too.


reply to skeechan

Re: In other news...

The rent is too damn high.

reply to InetforAll


The truth is that these caps are NOTHING but a obnoxious
"money grab"!

The truth is ugly and most providers are wretched greed mongers.

MBAs will be the death of honest business in the USA.


Baltimore, MD
reply to N3OGH

Re: In other news...

...the sky is blue...


reply to InvalidError

Re: Yeah, let's just ignore the access charges

Really? how do both cablevision and Verizon FiOS manage uncapped users, while also being two of the Fastest ISP's based on real life speed tests.

The lobbyist gave up the argument man, time to toss in the towel.


El Paso, TX
reply to pittpete1

Re: This made me laugh

said by pittpete1:

Comcast owns the lines and infrastructure. They charge a modest price for TV service and that pays the salaries of hard working individuals maintaining the infrastructure that carries TV, phone, and Internet.



Rosston, TX

1 recommendation

reply to skeechan

Re: In other news...

I discovered I like women better than men...


reply to InvalidError

Re: Yeah, let's just ignore the access charges

And there ya have it folks... some people still believe the old mantra about caps being an essential part of managing the "network".

No, caps are and have always been about PR and managing customers' perceptions about using the network. ("Don't use it! You might break it!")


Etobicoke, ON
reply to cableties

Re: But the tubes!

said by cableties:

They are using them up!!!

5% use 95% of the bandwidth.
Then there is the "sandvine" backdoor sniffing patent trolls....

95% of the traffic, not bandwidth. It is impossible for 5% to use up 95% of the bandwidth. It is the 95% of the users using up most of the bandwidth.