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rradina
join:2000-08-08
Chesterfield, MO
| Re: are you kidding? CrazyTown -- are you trolling? Your statements defy logic. Google and every other content provider pays a lot of money for their "bandwidth" to the Internet.
In the early days the bandwidth providers increased the efficiency of the pipe and lowered prices. They saw their "money grab" as luring more and more customers to connect to their transportation system. And they were successful. As prices dropped, revenue climbed as more and more customers joined.
Now with access ubiquitous, revenue growth has slowed. Instead of simply selling more, they need to figure out ways to be more efficient. But it's far easier to increase margins by raising prices than lowering costs.
Unhappy with their current lot, the bandwidth providers are seeking a way to grow revenue by redefining the landscape. While this would be as it should be in an capitalist society, I don't believe sufficient competition exists for the providers to police themselves. Wave after wave of ILEC mergers and buyouts have left us with only a few competitors. The oligopoly has spoken and they want to examine what is being transferred and charge a premium based on content value.
Their premise is that those who make more money, can pay to have their traffic prioritized. It's a sound assumption with the unfortunate side effect of potentially stifling innovation and competition in the entire tech sector. Soon bandwidth will be the key to every tech-centric business as they convert their business models from selling units to selling services.
What small businesses are asking is that our government police the oligopoly to prevent them from creating a landscape where the price of entry is so steep as to prevent all but the richest companies from providing new services. Such an environment is lazy in that it produces predictable growth and measured innovation. This would be unlike emerging world powers where government has taken a heavy hand in promoting massive communications infrastructures to ensure innovation's pace is as rapid as possible.
If we let the bandwidth providers have their way, it will be similar to the electric company charging a jewelry store (with 300% margins) more per kilowatt than a grocery store (5% margins). Not only that but in times of peak usage, the grocery store's frozen food may spoil to ensure that the jewelry store's customers always see the sparkle in that massive engagement stone.
Of course if we listen to the oligopoly, we either do this or face "clogged" pipes -- as the senator asserts. As I understand it, the Internet 2 proved that prioritization is a fools game. Although Quality of Service (QOS) prioritization schemes help in very predictable situations, the Internet 2 (like the Internet) was too unpredictable. Rather than QOS, they simply added more bandwidth and the problems vanished. | |
|  backness
join:2005-07-08
K2P OW2
| Re: are you kidding? i agree completely with you.
While studying this net neutrality debate it raises the question, for me anyway, Could the pathetic upgrade schedule of the north american broadband have contributed to the dot com bust? I think you might be able to prove the case that their resistance to lay fiber all accross the USA may have contributed significantly to the dot com bust as consumers were completely shut out of the broadband world and therfore all but the strongest business plans were completely useless.
Do we need to be put further behind? These people act like laying fiber to the curb is a bad for them (when in reality it becomes an asset to the company). Remember in 1985 they predicted that the USA would be almost all fiber to the house by 2000. The current regualtory enviroment of oligopoly control continues to drag their feet and need to have less control not more. | |
| | rradina
join:2000-08-08
Chesterfield, MO
| Re: are you kidding? I'm not sure laying fiber across the country is the problem. At least several years ago there were complaints that too much fiber had been installed and much of it was dark. I don't know if that's still true.
It is true, however, that an improved infrastructure to the curb (each home) has been artificially retarded by oligopolies unwilling to settle for a fair return on their investment. Rather than a fair return for their investment and having to deal with potential competitors leasing their investment (keeping prices low), they want to keep if for themselves and maximize their returns. And in a competitive environment, they have an obligation to do so for their shareholders. But fair competition does not exist. If it did, Google, Microsoft and other major content providers would not be voicing opinions. They would simply move their business to the next provider -- the way capitalism is designed to work; consumers having choices and thereby keeping vendors and providers efficient and fair.
Regarding running out of bandwidth -- the cable companies seemingly prove how ridiculous this notion is. Instead of lowering prices on existing bandwidth tiers, they keep raising the bandwidth on existing tiers. The only way this model works is if the bandwidth cost of the service is not linear (that is, as bandwidth increases, costs increase at a rate that is far less than proportional) or bandwidth represents such a small cost of the overall service that they can afford to double or even triple it speeds for the same price. Rather than running out of bandwidth, they continue to innovate by replacing equipment and modems so that they can offer increased upload and download speeds.
Although we've heard about the ILECs having improved DSL equipment to offer increased speeds over the same infrastructure, they've done next to nothing regarding these technologies. Granted, running fiber is much better but they've only recently begun doing this. And they seem to fight every competitor who wants to socialize the infrastructure and offer a community option.
I just don't trust the ILECs. They are old money and they are used to having guaranteed business, guaranteed profits and measured innovation. | |
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