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rradina

join:2000-08-08
Chesterfield, MO
reply to thistool

Re: Laymans terms

To me, it's crystal clear what they are trying to say. Capping miles driven per month or even per day to smooth traffic jams doesn't work. It doesn't work because there's no incentive to drive your allotment when it's not rush hour.

What might work is converting the roads to tollways and permitting free travel during off-peak times and charging stiff fees during peak hours.

So what's your problem with this analogy?

Applied to ISPs, it means going to 100% UBB where they charge less for off-peak hours and more for peak hours. There could even be "free" periods much like cell companies offer free nights and week ends. The free periods would cause the "hogs" to make sure their activity is performed when most other folks don't use the system.

The power companies incent business to use less power during peak periods by charging them less per Kwh during off-peak periods. Of course power is a poor analogy because building a new plant is crazy costly vs. upgrading a CMTS to handle channel bonding and employing other technological advances that transfer 10 times the data over the same strand of fiber.


FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5
said by rradina:

Applied to ISPs, it means going to 100% UBB where they charge less for off-peak hours and more for peak hours. There could even be "free" periods much like cell companies offer free nights and week ends. The free periods would cause the "hogs" to make sure their activity is performed when most other folks don't use the system.

That is an interesting idea on how to manage bandwidth usage and is worth a try by a big ISP just to see how it worked.
--
The nine most terrifying words in the English language are, I'm from the government and I'm here to help.
»www.politico.com/rss/2012-election-blog.xml


rradina

join:2000-08-08
Chesterfield, MO
Well don't hold your breath. Since there seems to be a quorum of negative opinions on ISPs ability to accurately track monthly usage, it seems a mighty big stretch to believe they could track it by the hour!


thistool

@144.70.2.x
reply to rradina
Did I need to thumbs up or favorite the post? I thought by expressing great analogy it was clear I like the post.


FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5
reply to rradina
said by rradina:

Well don't hold your breath. Since there seems to be a quorum of negative opinions on ISPs ability to accurately track monthly usage, it seems a mighty big stretch to believe they could track it by the hour!

This analyst thinks UBB is coming from 1 major ISP next year:
»www.bloomberg.com/news/2011-11-3···ech.html

At least one major cable operator will institute so-called usage-based billing next year, predicts Craig Moffett, an analyst with Sanford C. Bernstein & Co. in New York. He said Cox Communications Inc., Charter Communications Inc. (CHTR) or Time Warner Cable may be first to charge Web-access customers for the amount of data they consume, not just transmission speed.

“As more video shifts to the Web, the cable operators will inevitably align their pricing models,” Moffett said in an interview. “With the right usage-based pricing plan, they can embrace the transition instead of resisting it.”

Rogers Communications Inc., the largest Canadian cable company, has been billing broadband customers based on consumption since 2008. U.S. providers AT&T Inc. (T) and St. Louis- based Suddenlink Communications LLC are experimenting with usage-based plans.
Cable companies see usage-based billing as a way to limit the appeal of online services like Netflix and Hulu LLC, and reduce the threat from new entrants like Amazon.com Inc. (AMZN) and Google Inc.

The incentives to focus on Web access are compelling. Cable’s broadband gross margins are about 95 percent, versus 60 percent for video, according to Moffett. As programming costs increase nearly 10 percent a year, video margins are crimped, he said.
Time Warner Cable is testing meters to measure broadband consumption for the purpose of tiered pricing, Chief Executive Officer Glenn Britt said in June. In April, he said usage-based billing is “inevitable.”

Charging by Web usage, cable companies may discourage customers from dropping traditional pay-TV service and slow the growth of Netflix, Hulu and an expanding list of online alternatives, Moffett said.
The possibility of usage-based pricing has brought protests from Los Gatos, California-based Netflix and warnings from Charlie Ergen, chairman of rival Dish Network Corp. (DISH), which operates the Blockbuster movie-rental business.

Cable’s best option is to find ways to profit from the online shift, said Moffett. If the companies were to lose all of their video customers, the revenue decline would be more than offset by a lower programming fees and set-top box spending, he said.
“In the end, it will be the best thing that ever happened to the cable industry,” Moffett said.


--
The nine most terrifying words in the English language are, I'm from the government and I'm here to help.
»www.politico.com/rss/2012-election-blog.xml


WernerSchutz

join:2009-08-04
Sugar Land, TX
Uh, Moffet, the great clown, always fun to hear his "thoughts".


Sperkowitz
Premium
join:2002-03-30
Canyon Country, CA
reply to thistool
I guess when you wrote "Layman or not great analogy" it is read like "Layman, or not [a] great analogy." instead of "Layman or not, [a] great analogy."


delusion ftl

@tmodns.net
reply to rradina
There's no perfect analogy, but you do bring up some good points. If implemented they way you suggest it could end up being something like this:

User1. 1TB monthly bandwidth use
Billed 15 dollars

User2. 10GB monthly bandwidth use
Billed 10 dollars

This would be a case where user 1 and 2 both had roughly the same amount of peak consumption, and user 1 had tons of additional consumption at a time with a much lower rate.

On a personal level, I think it's fair. But you'd have a hard time convincing the clueless general public that it is.


elwoodblues
Elwood Blues
Premium
join:2006-08-30
Somewhere in
kudos:2
reply to FFH5
UBB has been kiboshed for independents in Canada, it's not going to happen.

The incumbents can UBB folks to death, once the masses realise they're beeing taken to the cleaners, they'll defect to the IISP's

rradina

join:2000-08-08
Chesterfield, MO
reply to thistool
Sorry. I now realize what you said is: Layman or not, great analogy.

rradina

join:2000-08-08
Chesterfield, MO
reply to delusion ftl
This discrepancy kind of happens in almost every LOB. Buying more usually lowers unit costs. I could even argue that those that trade in futures (grain, fuel, etc.), are trying to adjust the "time dimension" of their use to lower their cost which isn't that far removed from time-sensitive UBB.

Now before I get slammed, I don't agree that the economics of an ISP are in any remote way similar to the economics of other lines of business that lower costs through volume or futures purchasing. I'm just recognizing existing examples of lower costs for more vs. higher costs for less.


daSkippy

@mb.ca
reply to rradina
All that will do is move the peak usage times to when traffic is free.

talz13

join:2006-03-15
Avon, OH
said by daSkippy :

All that will do is move the peak usage times to when traffic is free.

People aren't going to stay up so they can use the internet for free at 2am when they have a job to get up for in the morning.

Some people will shift their usage, but the majority will not, as they have scheduled lives which resulted in the peak usage times in the first place (after school, after work, before bed)


DaneJasper
Sonic.Net
Premium,VIP
join:2001-08-20
Santa Rosa, CA
kudos:9

1 recommendation

reply to FFH5
said by FFH5:

said by rradina:

Applied to ISPs, it means going to 100% UBB where they charge less for off-peak hours and more for peak hours. There could even be "free" periods much like cell companies offer free nights and week ends. The free periods would cause the "hogs" to make sure their activity is performed when most other folks don't use the system.

That is an interesting idea on how to manage bandwidth usage and is worth a try by a big ISP just to see how it worked.

But, it's not necessary to charge during peak time - the fix is simply to slow the fastest user down to the level of the next-heaviest user. Iterate until the link is not congested.

Cisco implements a "weighted fair queuing" solution that basically achieves this outcome. The "hog" is slowed down a little when others want to "use the road", but is otherwise unimpaired - and not billed for bogus excesses!

See also my article here:
»corp.sonic.net/ceo/2011/12/02/web-hogs/

-Dane


bear73
Metnav... Fly The Unfriendly Skies
Premium
join:2001-06-09
Derry, NH

1 recommendation

*said by greedy Verizon exec* Shhhh!!!! dammit don't tell them that we can effectively and inexpensively manage our existing network! then we can't make double-digit profits while simultaneously convincing the gov't that we need subsidies to bring affordable broadband to the rural US!