Karl Bode
News Guy
join:2000-03-02
Host:
Road Runner
PC gaming GAMES
PC gaming Tech
| reply to pnh102
Re: Article Makes The Wrong Argument
It has to be a talking point, being circulated via think tank. I've seen it a handful of times in the past two weeks, and you're right. These are different issues.
At first I thought the confusion was accidental, and the authors were mis-reading the whole debate. I'm starting to think it's an intentional obfuscation campaign so the real debate (charging all IP service providers a new, previously un-billed tariff for priority service) is muddied.... |
|
calvoiper
join:2003-03-31
Belvedere Tiburon, CA
1 edit | pnh102 and Karl have it precisely right.
Much of the recent argument here has been whether or not there is justification for charging "power users" more than light users for more intense use of the same bandwidth. If there is a justification (and I'm firmly in the camp that believes there is) then the real question becomes "how big is that justification".
IF the "increased charge" is placed on the end user (where I believe it belongs) then ISPs can fairly compete for users, both "light" and "power" users, by tailoring their networks and peering arrangements to suit the traffic they expect. Some ISPs may choose to seek out "light users" and some may seek the "power users". Most importantly, competition will be direct and pricing will be a big factor. Meanwhile, content providers (including new content providers) will be free to offer content supporting only their direct costs--their own servers and their own connections to peering points. Whatever difference exists between the costs of "power use" and "light use" will be accurately reflected in the marketplace (and even the possibility of "zero" increased cost will be reflected as well.)
IF, on the other hand, the "increased charge" is diverted to the content provider space, then all of the competition is made much more fuzzy, and much more pricing power is placed in the hands of the big telcos. Competition will be much more devious, with a new ISP or a new content provider needing not just to cover its own costs, but to figure out a way to participate in the great slush fund of kickbacks that the whining Baby Bells control. In this case the Bells win because they can shift prices around as much as needed to temporarily underprice whichever market segment is seeing competition. Additionally, since they are only paying themselves, even if they "charge" their own content divisions for "access", they have a tremendous subsidy potential which will enable them to eventually dominate content as well.
Realistically, while there is some increased cost for "power" usage, it shouldn't be all that much--but if we let the big ISPs charge somebody else for it, then we'll never really know what that cost is--just like we didn't know long distance was cheap until the breakup of Ma Bell forced the baby Bells to allow competition in the LD space and not use it as a cash cow to be milked.
There you have it--the real reason that the Baby Bells are deliberately confusing these two issues is that this is how they can prevent vigorous competition at the end user level. Looking for the first time at a major revenue source that they cannot control outright, they are desperate to prevent real competition because they know they are too fat and lazy to really compete.
calvoiper |
|
Skippy25
join:2000-09-13
Hazelwood, MO
| I would agree with you 100%. I firmly believe that it should be the ISP that the customer has direct contact with imposing restrictions and that customer can make the decision based on those factors whether or not they do business with that company.
ISP's pay for their connection to the internet just like the rest of us. Their bottom line depends on the amount of bandwidth every user on their network uses. The more they use, the more they have to pay to get them where they want to go. Therefore, I feel they are well within their rights to shape their user's usage anyway they want; be it throttling (recommended), termination, caps (charges for exceeding) or "tiering". As long as the consumer has a choice in doing business with them AND as long as the consumer if fully aware of the 'limits' imposed by the ISP before hand. I would even go so far as to say EVERY agreement is grandfathered. In other words, they just can't pull the 'ol legal bait and switch by giving you the world today, but them taking it all away tomorrow with a new TOS. |
|
nixen
Rockin' the Boxen
Premium
join:2002-10-04
Alexandria, VA
 ·Cox HSI
 ·Speakeasy
| reply to calvoiper
said by calvoiper  :Much of the recent argument here has been whether or not there is justification for charging "power users" more than light users for more intense use of the same bandwidth. If there is a justification (and I'm firmly in the camp that believes there is) then the real question becomes "how big is that justification". Frankly, I don't buy it. The bandwidth providers already have tiered access through different speed plans. The more speed you want, the more you pay. Power users are already paying for bigger bandwidth. Your arguments seem to ignore this completely.
So, just how vested is your interest in gouging?
-tom
--
"Some people have morals, standards and ideals about quality, but I'm an American: I couldn't care less." --Tony Pierce (paraphrased) |
|
calvoiper
join:2003-03-31
Belvedere Tiburon, CA
| I don't have a vested interest at all. (I had a small amount of stock in the old Level3, but it was washed out in the bankruptcy.) I don't work for any player in this game.
The point is that "speed" and "capacity" are two different things, with different costs. As a simplified example, consider an independent ISP in a small town. The ISP connects with its end users, hubs all traffic at its office, and buys a "big pipe" out of the boondocks to the Internet "cloud".
To increase speed to any user, without increasing capacity used by that user, the ISP needs to upgrade its connection between the hub and the end user. That more expensive connection can accurately be reflected by an increased price for the higher speed.
Now let's consider the case where the users don't need more "speed", but they are going to use the speed they have far more intensively. In this case, the end user connection remains unchanged--but the "big pipe" needs to get bigger to handle the increased traffic.
(And don't tell me the big pipe should already be big enough--NO ISP totally builds a 100% "clear through" network to its peering points--it just doesn't make economic sense not to share some facilities.)
So the question is, when shared facilities need to be augmented, do you charge everyone, or do you just charge those who are causing the augment?
Now, I firmly believe what I've just written--but the important thing is that EVEN IF I'M WRONG, the ONLY way we'll know is if we keep the big ISPs from charging content providers and let ISP competition go after the end user directly. If ISP business costs are covered for some ISPs by hidden "content provider kickbacks", then we'll never really know if these "big pipe augments" needed higher revenues or not, will we?
The big ISPs need to pass their claimed increased costs along directly so cheaper ISPs can compete with them, rather than hiding them in slush fund swaps conducted by the "big player club".
calvoiper
--
VoIP--the death knell of remaining voice monopolies! |
|
cmaenginsb
Premium,MVM
join:2001-03-19
Palmdale, CA
| reply to nixen
Tom, someone using a 768k line maxed out 24x7 should be paying more than someone using the same 768k line for may be 1-2 hours of the day. That's the argument.
Of course providers have tried to enforce this in the past with caps but have been mostly shot down.
--
CCNA, Comtrain Certified Tower Climber |
|
NogustaX
@sympatico.ca
| reply to calvoiper
Calvoiper... very well written. Spin is in.
Unfortunately the telecom & cable backed ISPs are used to being able to redefine words. "Unlimited" means whatever we feel like letting you have at a given time.
Very good theory (and likely the truth) that the whole point is to reduce if not, for all realistic purposes, outright block competition. |
|
stlpmpnu
join:2001-03-13
Saint Louis, MO
| reply to nixen
I don't think its right at all a user pays for a certain speed just because they actually use it does not justify them being charged more. There network that are over crowded is not any of the customers concern they pay for it they should get it. If they want to put on caps then they need to be 100% clear about it. |
|
Talis
join:2001-06-21
Houston, TX
| reply to calvoiper
said by calvoiper :So the question is, when shared facilities need to be augmented, do you charge everyone, or do you just charge those who are causing the augment? I understand your argument, but disagree with your conclusion. In my mind the question is, what exactly has the ISP sold to the user? If I purchase a 1.5m connection and I use that connection 24/7, why should I be charged more than you, who may have purchased the same 1.5m connection but only use it 1 hour a day? The ISP sold me the bandwidth. Why am I not allowed to use it? Why is it my problem that their infrastructure can't meet the demands of what they sold?
If they aren't selling capacity, what are they selling? |
|
calvoiper
join:2003-03-31
Belvedere Tiburon, CA
| They're selling the ability to OCCASIONALLY use very fast downloads without CONSTANTLY using them.
It's not unreasonable for an ISP to restructure its service offerings to more directly address different types of customers.
As an example, someone who wants fast downloads of web pages, but then spends several seconds looking at them, would want capacity without necessarily wanting to use it 100% 24/7. Likewise, someone who wanted to play an MMORP Game or watch a movie without advance downloading it, but for only a couple of hours a day, would be a customer of a service that provided broadband but didn't include 100% usage of the capacity 24/7 in the base price.
I understand that some folks are justifiably angry about "all you can shovel" plans that haven't delivered--but that's a separate issue from allowing an ISP to more clearly spell out TO THE END USER what they will deliver for a given price.
calvoiper
--
VoIP--the death knell of remaining voice monopolies! |
|
calvoiper
join:2003-03-31
Belvedere Tiburon, CA
| reply to stlpmpnu
I agree that any plan which deviates from the now common "all you can shovel" approach should be clearly spelled out to the end user. My main argument is that offering other such plans should be possible, just as various cellphone calling plans are available.
(And yes, over time it may develop that there would be something like day/evening/night rates which work to level out the demand curves of the shared facilities.)
calvoiper
--
VoIP--the death knell of remaining voice monopolies! |
|
