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battleop

join:2005-09-28
00000

What PR disaster?

"which begs the question why would internet providers pursue a policy that is such a PR disaster?"

It's only a PR disaster here at DSLR. If it really was a PR disaster then customers would be upset and the carriers might make some changes. According to the editorial caps effect about 2% of users which means that 98% of people could care less about caps because they don't reach them.

whome123

@att.net

Re: What PR disaster?

People are upset but what alternative to they have then the gov supported duopolies?

If were going to artificially pick the winners and losers in Broadband shouldn't we plebians at least have uncapped connections?

MRCURAnon

@airband.net
That was my first thought as well. This editorial, and DSLR, assume caps are a "PR disaster". Ask any average consumer if they have a cap or if they care. Doubt you'll see the same "outrage" you do around here.

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Re: What PR disaster?

said by MRCURAnon :

That was my first thought as well. This editorial, and DSLR, assume caps are a "PR disaster". Ask any average consumer if they have a cap or if they care. Doubt you'll see the same "outrage" you do around here.

I agree. My friends all had high tech jobs in computers and telecomm fields, use the internet at home extensively, and the issues of caps doesn't even come up at all. The vast majority of customers don't even know that caps even exist.

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK

Re: What PR disaster?

It will.

The same could of been said about Government borrowing a few years back.

It's going to get on the consumer radar when they start getting "3 strike"'d and overage charges are applied to their bill or disconnections occur etc.

The outrage will grow.
--
"Fascism should more properly be called corporatism because it is the merger of state and corporate power." -- Benito Mussolini

JasonOD

@comcast.net
said by battleop:

....According to the editorial caps effect about 2% of users which means that 98% of people could care less about caps because they don't reach them.

Then the caps are a failure and need to be lowered. This needs to become a pay-for-use model if providers are going to grow enough to remain profitable.

As a stockholder, it pisses me off to no end that Comcast has caps but no way of monetizing the overages.
Skippy25

join:2000-09-13
Hazelwood, MO

Re: What PR disaster?

said by JasonOD :

As a stockholder, it pisses me off to no end that Comcast has caps but no way of monetizing the overages.

Poor guy. That makes me so sad. Be sure to voice your concerns at the next meeting. Maybe they could really lower the caps and get a little more profit in there before consumers start flocking to other carriers (provided of course they have a choice). Then you can dump the stock as it tanks and buy into the next get rich quick scheme.

JasonOD

@comcast.net

Re: What PR disaster?

So you prefer getting kicked off as a subscriber than paying a fair overage fee? That makes no sense for anyone.

Simba7
I Void Warranties

join:2003-03-24
Billings, MT

Re: What PR disaster?

Define overage. The entire industry thinks that data is like water, fuel, electricity, etc. It is not. If you want it to be, the entire industry needs to become a utility, which they clearly don't want to be.

It's the ISP's that think it's a good idea to issue caps to gain more revenue. Unfortunately, most don't bother upgrading their network and not giving a damn about their own customers.

Maybe if most of the ISPs were more honest with their customers, they'd be fine with caps.. but when they can't even get the cap meter to work properly.. Ya.
--
Bresnan 30M/5M
MyWS[i7-870@4.1G,16G RAM,2x1T HDDs,Win7]
WifeWS[A64@2G,2G RAM,120G HDD,Win7]
Router[2xP3@1G,512M RAM,18G HDD,Allied Telesyn AT2560FX,2xDigital QP DE504,Compaq DP NC3131,2xSun QP GigaSwift, SMC 8432BTA, FreeBSD]
Crookshanks

join:2008-02-04
Binghamton, NY

Re: What PR disaster?

said by Simba7:

Define overage. The entire industry thinks that data is like water, fuel, electricity, etc. It is not.

Bandwidth (not data, there is a difference) is a finite commodity. Perhaps they should bill using the 95th percentile method? Last month I used 192GB (184 down/8 up) and my 95th percentile was 2.9mbit/s. Conversely they could do average bandwidth billing; mine would have been 574kbit/s.

I'm not sure most consumers would be able to understand this though. Then again, electric utilities have been doing demand billing for years and nobody complains about that...

jmn1207
Premium
join:2000-07-19
Ashburn, VA
kudos:1

Re: What PR disaster?

The electric company doesn't charge a flat fee at a rate that makes a healthy profit for the executives, and then charge for kilowatt usage in pre-set amounts. They don't charge over 10 times the normal rate if this set amount is exceeded, and they don't flip the switch off if you go a little nuts with the Christmas lights in December.
Crookshanks

join:2008-02-04
Binghamton, NY

1 recommendation

Re: What PR disaster?

Do you actually know how demand billing works? They measure your electrical consumption every 15 minutes and charge you a set fee for every kilowatt that you use. A business that occasionally runs an energy intensive appliance will pay out the nose with demand billing. Use 40,000 watts for 15 minutes and 200 watts for the rest of the month? That's a 40kW demand charge. On top of the demand charge they continue to charge you for each kWh that you consume.

I would also dispute the flat fee claim. Between my electric and gas I'm paying $30/mo in "service charges" before you consider the actual energy consumption. It does not cost them $30/mo to leave meters at my residence yet that's what I'm charged each month.

Anyway, it's not a perfect analogy, but the underlying point stands. Bandwidth is a commodity and limited resource. Data itself really isn't, except insofar as users with high data consumption will obviously have a higher average bandwidth usage.
rradina

join:2000-08-08
Chesterfield, MO

Re: What PR disaster?

We use this in our retail grocery stores to actually lower our utility bill. By applying energy management techniques, our coolers run defrost cycles in the early AM hours, per agreement with the utilities. They monitor our usage with smart meters and lower our costs because we work with them.

I just wanted to point out that demand billing can have a useful purpose and isn't necessarily something crafted by the electric company to make more money. In my opinion, they do this to incent heavy users to work with them to flatten the overall system's peak demand curve.
Crookshanks

join:2008-02-04
Binghamton, NY

Re: What PR disaster?

I agree, demand billing can be beneficial if you know how to work the system. This bit is spot on:

said by rradina:

they do this to incent heavy users to work with them to flatten the overall system's peak demand curve.

Frankly I'm surprised that none of the wireless carriers have tried to do free nights and weekends for data. It might even work for wireline carriers with capacity issues.

95th percentile billing would also be fair, though you'd be hard pressed to explain it to John Q. Public.
rradina

join:2000-08-08
Chesterfield, MO

Re: What PR disaster?

Fantastic idea but if unlimited, we'd all probably start streaming videos after hours and this peak could end up obliterating the daytime peak and melt the network after hours.

Since folks peak video hours are probably evenings / week ends, it also comes into direct conflict with carrier concerns regarding OTT video replacing cable/U-Verse/FIOS video packages.

Personally, if they offered free nights/weekends, I might be tempted to drop the cable TV package, sign up with NetFlix and fire up the iPhone as a hotspot at night. I already pay $45/month for ATT's 4GB data/tethering plan -- which I love. If they let me have unlimited after-hours data, it would be tempting to make the kids pay for cable Internet, dump the cable TV pay package and just always use my iPhone for Internet access at home.

OK -- before you call me a mean-old-dad, I'd never make the kids pay for Internet access and I'd have to keep at least wired access since I'm not home all the time and heaven forbid they can't Skype, IM and video conference their friends and play on-line games. But they are 15, 13 and 8. In ten years the last one leaves the nest (hopefully) and then lots of overlapping services will no longer be necessary.

I love the idea but something tells me they won't do it. To be honest, this is probably a good middle-ground for Sprint to save face. I fear their unlimited won't be unlimited for long and this might still be a way to differentiate while keeping their daytime business customers happy.

56403739
Less than 5 months left
Premium
join:2006-03-08
Naples, FL
kudos:2
said by Crookshanks:

Frankly I'm surprised that none of the wireless carriers have tried to do free nights and weekends for data. It might even work for wireline carriers with capacity issues.

Welcome to the old long distance billing model. Most of the capacity crunch was during daytime business hours so the cost was much higher during those times and it made sense from a network and a business standpoint.

The problem now is that the delineation between "peak" and "offpeak" in the Internet world has absolutely nothing to do with network usage and everything to do with how hot ISPs can turn up the pot before the consumer frog jumps out.
gunther_01
Premium
join:2004-03-29
Saybrook, IL

Re: What PR disaster?

said by 56403739:

said by Crookshanks:

Frankly I'm surprised that none of the wireless carriers have tried to do free nights and weekends for data. It might even work for wireline carriers with capacity issues.

Welcome to the old long distance billing model. Most of the capacity crunch was during daytime business hours so the cost was much higher during those times and it made sense from a network and a business standpoint.

The problem now is that the delineation between "peak" and "offpeak" in the Internet world has absolutely nothing to do with network usage and everything to do with how hot ISPs can turn up the pot before the consumer frog jumps out.

That's crazy that you don't understand there is a peak and non peak times for an ISP.
--
»www.wirelessdatanet.net

56403739
Less than 5 months left
Premium
join:2006-03-08
Naples, FL
kudos:2

Re: What PR disaster?

I'm crazy? Do you have even a slight clue what I was talking about?

jmn1207
Premium
join:2000-07-19
Ashburn, VA
kudos:1
A better analogy would be to use roads for capacity, trucks for packets, and the truck's cargo for your data, with network management implementation acting as a toll gate.

There is no consumable commodity being used up that can be accurately compared with utility services such as electricity or water usage.
Crookshanks

join:2008-02-04
Binghamton, NY

Re: What PR disaster?

You still don't understand the difference between BANDWIDTH and DATA. Bandwidth is not a "consumable" commodity but it's still a limited resource.

The demand billing analogy is very apt. They aren't charging you for the electric you use they are charging you for the burden you place on the grid. Your analogy that they won't shut you off is also misplaced; you won't get cut off for hanging too many x-mas lights but if your residential connection starts using industrial amounts of electricity you will undoubtedly be forced into a higher tariff.

Heck, where I live the PSC rules allow them to force you into a commercial class of service for a home business that uses >=1.5kW of electricity. 1,500 watts and you are compelled to pay more just by virtue of it being commercial. That's a single space heater or large air conditioner.

jmn1207
Premium
join:2000-07-19
Ashburn, VA
kudos:1

Re: What PR disaster?

I believe that I absolutely do understand the difference, and my analogy should have made it very clear. (roads=capacity, cargo=data)

When you say bandwidth, I am assuming you really mean bandwidth capacity. If not, then I suppose you have completely lost me, which is quite possible.

I understand the reasoning behind demand billing, but the resource is finite that I am consuming in these scenarios. I believe the "bandwidth" you are referring to in your analogy is equivalent to the roads in my analogy. The roads can only hold so much traffic, but they are not being used-up in the traditional sense that electricity or clean water might be.

In other words, we are not running out of water because everyone is thirsty and demand has dwindled the supply to a trickle. We can't get our water because the pipes are too damn small to deliver the water so that everyone can get a drink or take a shower at the same time that I am filling up my swimming pool.

I'm not sure that demand billing is the solution for network congestion and a fair method to charge for the service. If implemented in any form, it most likely would result in little to no improvement to the existing infrastructure.
Crookshanks

join:2008-02-04
Binghamton, NY

Re: What PR disaster?

said by jmn1207:

We can't get our water because the pipes are too damn small to deliver the water so that everyone can get a drink or take a shower at the same time that I am filling up my swimming pool.

If you are content to fill up your swimming pool using water at the same rate I use when taking a shower I doubt you'd have a problem. If you want to draw water at the same rate as a firetruck with your residential hookup then you are going to have a problem....

said by jmn1207:

I'm not sure that demand billing is the solution for network congestion and a fair method to charge for the service.

What's fair then? A lot of people around here complain that caps are too small because they've got a family of four all using the same connection for streaming video. Why should those people pay the same as single person who rarely watches video? Why should the proverbial Grandma who only reads e-mail pay the same? And while we are on the subject, where did this sense of entitlement regarding video come from? Video is not a life essential service. It's not electricity, it's not running water, it's not telecommunications.

said by jmn1207:

If implemented in any form, it most likely would result in little to no improvement to the existing infrastructure.

Infrastructure improvements will come when there is a financial incentive for them. In the current duopoly/monopoly environment there is little such incentive. We've also got a Government talking about a broadband plan. Why would any private enterprise invest billions of dollars into their infrastructure when they have no competition and the Government is talking about doing it for them? Verizon was investing billions into FIOS until we wound up a Government that was talking about using taxpayer dollars to do the same thing. I'm not convinced the two are unrelated.

In any case, I'll concur that our broadband market sucks. I do think that's a separate discussion from what sort of billing system would be fair though. The current notion of everybody paying the same regardless of usage hardly seems fair to me. It's not fair to the ISPs or the end users.

Yes

@insightbb.com
Most electric utilities charge lower unit rates the more you use. In the lower Mid-West, many homeowners learn this in the winter time when their heat pumps kick on and usage jumps above 1 or 2 kW for the month. The same holds true for industrial customers, although they do have higher fixed service charges than residential. So this is really a bad analogy comparing electricity and internet bandwidth.

Demand based billing can easily be gamed by the provider of service. Enron did this quite well in California. Demand based billing may also require expensive new meters that ratepayers pay for directly or indirectly. Hell, I'll go out and read my reliable 1982 mechanical electric meter once a month and report online "under oath" if it saves me a % on my electric bill every month. No need for a new made in China electronic meter with drive by wireless here. I'll pass on demand based billing for now.

88615298
Premium
join:2004-07-28
West Tenness
said by Crookshanks:

said by Simba7:

Define overage. The entire industry thinks that data is like water, fuel, electricity, etc. It is not.

Bandwidth (not data, there is a difference) is a finite commodity. Perhaps they should bill using the 95th percentile method? Last month I used 192GB (184 down/8 up) and my 95th percentile was 2.9mbit/s. Conversely they could do average bandwidth billing; mine would have been 574kbit/s.

I'm not sure most consumers would be able to understand this though. Then again, electric utilities have been doing demand billing for years and nobody complains about that...

Utilities are also REGULATED. ISPs are not do they want to be. If they want to charge like utilities they need to be regulated like one. They can't have it both ways.

Simba7
I Void Warranties

join:2003-03-24
Billings, MT

Re: What PR disaster?

said by 88615298:

Utilities are also REGULATED. ISPs are not do they want to be. If they want to charge like utilities they need to be regulated like one. They can't have it both ways.

My point exactly.
jcremin

join:2009-12-22
Siren, WI
kudos:3
said by Simba7:

The entire industry thinks that data is like water, fuel, electricity, etc. It is not.

I have a hard time understanding when people say that bandwidth is not "consumable" like the other utilities. Sure, maybe you don't actually consume the resource, but technically, you don't consume water or electricity. The water evaporates out, runs back into the ground, and somehow ends up back in the beginning of the cycle. Electricity is just energy, and energy can only be converted from one form to another. So bandwidth is just like electricity or water because you are just converting bits to a video, picture, or text, right?
rradina

join:2000-08-08
Chesterfield, MO

1 recommendation

I see your point and I agree that it would be better to monetize overages than terminate service.

However, I don't buy the current reasons as to why caps are needed. If it only affects 2%, then it isn't about the original claims centered on protecting the network experience by mitigating the very few heavy users. Sans speculation, the only meaningful purpose caps serve is mitigating court hassles if a service termination is challenged. However, there are other ways to define excess without a hard ceiling. Why not statistically look at those outside of 2 standard deviation units from the mean use? It's simple. It's objective. It's easy to explain to the court. Since alternatives exist, I'm at a loss, without speculation, as to why caps exist.

Now if I speculate, there's only one rational reason for cable caps. They are a hedge against OTT video displacing the current distribution model.

There's nothing wrong with this but if the wired industry follows the wireless industry and OTT video wins, unless a lot more competition develops, the public will become VERY aware of caps and efforts to regulate ISPs as utilities will get a lot of attention.

The bottom line in all of this is most folks don't mind getting screwed a little. While some don't want ANYONE to make money, most are OK with being asked to bend over a little bit. But in the absence of competition, companies don't seem to exercise rational restraint because it's far easier to raise fees than invest capital to lower operational costs. I certainly don't fault companies for this because we're all human. If there's no reason to restrain increases, why would I take the risk of keeping revenue tied to inflation by investing in property, plant and equipment maintenance? That's why honest competition is so fundamental in capitalist economies.

In my opinion ISP thinking is not unlike the medical industry whose costs continue to soar because there's really no reason to restrain costs. The consumer really isn't part of the equation because either the government or their employer pays for most of their medical care. Neither the consumer nor the medical industry needs to obey normal cause and effect economics.

As an example, my dad gets frequent injections in one of his eyes to abate his macular degeneration. Each shot is billed at over $4,000. Medicare reduces that cost to about $1,800, by contract, and by the time they pay and his supplemental insurance pays, it only costs him the price of lunch at a nice restaurant. Where is the incentive for him to challenge the injection's necessity or for the medical industry to acknowledge the fee is excessive?

And where is the incentive for the duopoly that is the wireless industry to acknowledge that charging someone $10 for a gigabyte of wireless data is egregious? In this same breath, will there be a future reason for the wired industry to believe a $150/month package for truly unlimited service is reasonable when their network has been relegated to a dumb pipe and only carries NetFlix OTT video and various cloud services data?

Yes

@insightbb.com

Re: What PR disaster?

Nice post. I definitely agree about meaningful competition being critical to a successful market. From a consumer standpoint, a multitude of companies competing for customers and just barely getting by (profit wise) should be the goal. Fat, lazy, and poorly regulated corporate monopolies and duopolies only help themselves (and their paid-off regulators) and generally provide lesser value to customers.

We just started Netflix a month ago, and we see great value in this OTT streaming service. You choose the content on your schedule and NO COMMERCIALS for $8/mo. SOLD! The movie selection could be better, but overall we like it. We don't subscribe to cable T.V. because we don't see the value in it when we already have great digital OTA (with commercials) for FREE.

Our 10/1 cable internet provider just coincidentally came to our home recently and checked for bandwidth "leakage." They didn't find any, but I'm sure they have noticed our bandwidth use increasing. We pay the monthly fee and that is supposed to pay their cost plus profit margin. We have two cable internet providers in our area.

If the day comes that they charge overages (highly unlikely with poor meters) or cut-off our bandwidth, then we will look for alternatives offering the same price point and Netflix like experience. We will not, however, subscribe to cable TV.
rradina

join:2000-08-08
Chesterfield, MO

Re: What PR disaster?

said by Yes :

... a multitude of companies competing for customers and just barely getting by (profit wise) should be the goal...

I disagree on the just barely getting by goal. I believe corporations can and should make a fair profit and that investors are also an important part of the equation. (Let's face it, we're all investors ever since the 401k scam laws were passed -- don't get me started on that...)

However, I think there's a line in the sand where fair profit ends and greed drives radical decisions. For instance, I would pay a bit more for a products and services if I knew the company was committed to keeping skilled professional jobs here instead off-shoring jobs. Unfortunately just like it's easier to raise fees than invest in maintenance, it's also easier to move jobs to save costs rather than innovate when you are getting beat by competitors. Granted your competitor may have lower labor costs because they moved jobs but it's still a quick fix. My company is off-shoring a lot of IT infrastructure jobs because their core product/service has languished for years. Now they claim they have no choice and that they are far behind competitors who are way ahead of them.

I don't buy it. Again, I think they are trying a quick fix after years of mismanagement. Granted, if all the competitors move jobs, they may eventually be forced to follow but to suggest this will save the company after years of incompetence is a fantasy. But it sounds good to investors who have the CEO's head on the chopping block.

djrobx
Premium
join:2000-05-31
Valencia, CA
kudos:2
Reviews:
·Time Warner Cable
·VOIPO
I actually am fine with the concept of paying for usage. But it has to be fair, and experience has proven over and over that carriers will screw over customers as much as possible instead of charging fair prices.

My mother, who probably uses about 3GB/month, is paying over $40 per month. But we want the faster tier because she may want to watch an occasional streaming HD VOD. I use significantly more. I'd be fine paying up to about $60 for my usage.

She should be spending $20, and I should be spending $60. Instead we both pay $40. If you leave this up to greedy carriers, Mom will continue to pay $40, but I'll pay $60-80.

Fair usge based pricing means that light user should be getting a price break, because they've been subsidizing the heavy users until now. Carriers want to have their cake and eat it too.
--
AT&T U-Hearse - RIP Unlimited Internet 1995-2011
Rethink Billable.

juilinsandar
Texas Gooner
Premium
join:2000-07-17
San Benito, TX
Reviews:
·Time Warner Cable
I've got a friend who didn't know about AT&T's caps until I told him. He wondered why his phone bill had almost doubled. He's switching to Time Warner for internet only as he already has DirecTV and is happy with it for now.
--
An appeaser is one who feeds a crocodile, hoping it will eat him last. - Sir Winston Churchill

disaster

@sbcglobal.net
DSLR and many users here are ahead of the tech curve, so you can expect to the general population to slowly become aware in time. With smart phones and tablet devices on the rise AND streaming becoming more common, this is a PR disaster brewing.

The solution to this insatiable greed of telco and cableco is have a common pipe and let providers compete with service over the same network. It can be done. See Utopia now, and in the future Google's Fiber project in Kansas city.
gunther_01
Premium
join:2004-03-29
Saybrook, IL

Re: What PR disaster?

said by disaster :

DSLR and many users here are ahead of the tech curve, so you can expect to the general population to slowly become aware in time. With smart phones and tablet devices on the rise AND streaming becoming more common, this is a PR disaster brewing.

The solution to this insatiable greed of telco and cableco is have a common pipe and let providers compete with service over the same network. It can be done. See Utopia now, and in the future Google's Fiber project in Kansas city.

This is funny.. You actually think each home is going to have a gig huh? I suppose you think that it's guaranteed to EACH home as well.. Google is doing nothing more then the same thing the telco's and cable Co's have been doing for years. They upgrade, and then offer a faster teir of service. BETTING that you will not use it all, ALL of the time. That's how residential networks are built. It's called a contention ratio.. Google is just doing it in such a large scale that you are impressed with the numbers of it. That and the fact, that you would be hard pressed to use a gig personally all of the time. No matter what you are doing. It's the SAME thing. At some point, that network will be congested also, then everyone will be crying that a Flippen GIG isn't enough.. Or they aren't getting what they were promised, or what they are paying for, or something else to cry about.

give me a break already.
--
»www.wirelessdatanet.net