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Sonic CEO: Caps Make Little Technical Sense
Are About ISPs Protecting TV Revenues
by Karl Bode Friday 09-Dec-2011 tags: business · bandwidth · caps
Last week we directed your attention to new analysis discussing how the "bandwidth hogs" as portrayed by ISPs is generally a myth, and that the caps instituted by most ISPs aren't really effective at tackling the heaviest users. What they usually do is punish all users, and that's done in part to try and limit Internet video's impact on TV revenues. Sonic.net's CEO Dane Jasper has blogs about his company's decision to participate in the study, and how the real reason for caps and overages is to protect television revenues:

As more and more broadband providers have instituted caps, I have continued to say that caps are really not necessary and that even if congestion was to be a problem, consumption caps are the wrong way to address the potential problem: congestion during peak time on the network slowing everyone down....My opinion is that caps make little technical sense, and I believe that the fundamental reason for capping is to prevent disruption of the television entertainment business model that feeds the TV screens in most households.

That's what I've been pointing out for several years now, though most ISPs continue to insist that imposing caps and steep overage fees is about altruism, fairness, and making life betters for grandmothers everywhere. Jasper goes on to note that congestion shouldn't occur if you're investing and building a quality network, but if and when it occurs, caps aren't the way to handle it:

Their conclusion is reassuring, as it affirms our gut feelings about user behaviors and consumption: while heavy consumers may tend to be a contributor to peak load, their total consumption is a poor proxy for their impact during the potentially critical peak-load periods. We believe that if any bandwidth management were required, slowing the largest consumer down to the level of the next-largest and so on, in the specific moment during congestion conditions would be a more reasonable policy.

That said, note that bandwidth management is not used in our network. We upgrade links before congestion occurs.

As one of the only CLECs to not only survive the residential CLECapocalypse but beat back the nation's broadband duopolies to build their own network, Jasper's certainly in a position to know. As it stands, Sonic can tell the truth because it doesn't have a television empire to protect, though the company has been rumored to be pursuing an IPTV or streaming video play.

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ZeddicusToo

@verizon.net

Well, almost...

Change the "make little technical sense" to "make no technical sense" and I'll agree completely. Of course, getting the cap-alicious (cap-tastic?) ISPs to agree (or simply use whatever "little" brains they have) is not something I expect to happen any time soon.
prairiesky

join:2008-12-08
canada
kudos:2

Re: Well, almost...

said by ZeddicusToo :

Change the "make little technical sense" to "make no technical sense" and I'll agree completely. Of course, getting the cap-alicious (cap-tastic?) ISPs to agree (or simply use whatever "little" brains they have) is not something I expect to happen any time soon.

disagree.

In every TOS there is a reasonable use clause. something to the effect that the connection cannot be abused. But then this begs the question and leaves open for interpretation, "what is reasonable use". One person's reasonable for a month is another's reasonable for a day. By defining a cap, they are giving everyone a very clear and technical understanding of what is considered "reasonable".
crypto

join:2010-05-13

Re: Well, almost...

Wow. Thats like the cable company coming into my house and shutting off the tv because I watched the star trek and star wars marathon but my neighbor didn't. "Your not allowed to watch tv for 24hrs straight, our business plan clearly states; users must sleep 8hrs/day!"

get lost... take the toilet paper your TOS is written on with you.

djrobx

join:2000-05-31
Valencia, CA
kudos:1
Reviews:
·VOIPo
·Verizon Wireless..
·RoadRunner Cable
·AT&T U-Verse

Re: Well, almost...

With the exception of SDV, your cable company is blasting every show on every channel to you 24/7, so they don't care if you're using it or not. Your TV usage habits aren't likely to impact other customers. That is not so with a broadband connection.

That said, I agree with Dane. AT&T has proven that you can create a fairly competitive TV service with as little as 19mbps. So, the big players want a roadblock to prevent the sort of cannibalism that VOIP was able to do to POTS.

AT&T/SBC was doing just fine with unlimited plans until they started selling TV service.
--
AT&T U-Hearse - RIP Unlimited Internet 1995-2011
Rethink Billable.
Stumbles

join:2002-12-17
Port Saint Lucie, FL

Re: Well, almost...

Well the only thing AT&T has proven is this; compressing HD to 19mbps results in crappy video that cannot be called HD from a visual perspective.
talz13

join:2006-03-15
Avon, OH
More like, you're using poorly engineered splitters or devices that are injecting noise back into the cable system, causing your neighbors to complain about their signal quality.

dvd536
as Mr. Pink as they come
Premium
join:2001-04-27
Phoenix, AZ
kudos:4

Caps

Of course its about protecting legacy video revenues.
Sonic has no caps. Sonic also doesn't have video to protect.
--
Oh YES! let me drop everything i'm doing regardless of who it affects to deal with your petty little problem!

Linklist
Premium
join:2002-03-03
Longport, NJ
kudos:5

Re: Caps

said by dvd536:

Of course its about protecting legacy video revenues.
Sonic has no caps. Sonic also doesn't have video to protect.

And for the most part, Sonic uses infrastructure from AT&T & Verizon for their connections to homeowners.
25139889

join:2011-10-25
Toledo, OH

Re: Caps

Yes but not all of their network. Sonic is a reseller/wholesale provider of the last mile or even where they don't have their own network; they're still connected to the T network just having an ATM circuit feeding their PPoE server.

IowaMan
Premium
join:2008-08-21
Grinnell, IA
Same with most Independent DSL providers. Windstream as well
gorehound

join:2009-06-19
Portland, ME
If Sonic came to Maine I would probably just drop Slime Warner.

JohnInSJ
Premium
join:2003-09-22
San Jose, CA
Reviews:
·PHONE POWER
·Comcast

comcast doesn't use caps for congestion management

And Dane knows it.

I know Dane's a good guy, but he's used the cap card to beat on his competitors before. I clearly remember the day he (Dane/Sonic) disconnected a sub who used 80% of his potential DSL (6M) pipe in a month. Because he was costing Sonic more than he paid in backhaul.

Funny that Dane can't remember that.

But anyway, beat that dead horse.
--
My place : »www.schettino.us

ZeddicusToo

@verizon.net

Re: comcast doesn't use caps for congestion management

I'm sure that--just as with all of us--everything he believes now is what he's always believed. I mean, I still believe in Santa Claus and the Easter Bunny and the Tooth Fairy... yep, always have, always will.

"Many is the man who can change his shirt but can't change his mind."

"Wyl-l-l-bur."

Oh_No
Trogglus normalus

join:2011-05-21
Chicago, IL
As an internet reseller ISP, he gets screwed in the butt by the Tier1 ISPs that unfairly charge him by the byte when their costs are not based on usage.
If the Tier 1 ISP did not screw over internet resellers then they would not care at all about usage.

Internet resellers are victims of the 'per byte' game just like us end consumers.

jpj

@comcast.net

Re: comcast doesn't use caps for congestion management

and just like us end consumers, is protesting with their wallet as ineffective because they can get government to shield them?

DataRiker
Premium
join:2002-05-19
00000
said by JohnInSJ:

And Dane knows it.

I clearly remember the day he (Dane/Sonic) disconnected a sub who used 80% of his potential DSL (6M) pipe in a month. Because he was costing Sonic more than he paid in backhaul.

Funny that Dane can't remember that.

But anyway, beat that dead horse.

I don't think he will remember that because its inaccurate.

I believe the disconnect was initiated by ATT, and there was a thread about it here.

Furthermore I don't believe they have ever disconnected one of their own users on their network, ever.
25139889

join:2011-10-25
Toledo, OH

Re: comcast doesn't use caps for congestion management

T would have NEVER disconnected the customer as Sonic would be paying ATT for the ATM pipe to the ATT DSLAM and to Sonic's PPoE Server/RADIUS. So it would actually be Sonic that would have killed the customer. ATT would have not really been able to see anything.

DataRiker
Premium
join:2002-05-19
00000

3 edits

Re: comcast doesn't use caps for congestion management

Not according to the thread on here. If you search hard enough you will find it.

If memory serves it violated a contractual obligation with ATT.

I wasn't there personally but I don't see why they would lie about it.

Furthermore, nobody has ever been kicked off a non-legacy ATT connection.
25139889

join:2011-10-25
Toledo, OH

Re: comcast doesn't use caps for congestion management

thats why i said that 3rd party ISPs run their own circuits to ATT's DSLAM "cloud" and then to their own network. chances are something more happened than what Sonic or T was saying (probably more on the Sonic side).

hi82

@comcast.net

caps

There may be a reason to have them, but its still bad for people who can't afford both, or just don't watch tv at all or enough to warrant the price and would rather get the same things thru the internet instead.
chex383

join:2003-03-13
Montreal, QC
Reviews:
·TekSavvy DSL

Dane Jasper for President

I love this guy so much.

Amid a industry filled with cynicism, greed, sloth and pure laziness, this guy is a shining beacon in the fields of Mordor.

Dane for Pres in 2012!!

-- Stefan, dealing with the worst capping you can imagine in Canada..
--
Sung to the old New England Telephone Ad Jingle: " We're the only one New Eng-Lund, Hell-Ri-zon Tele-phonnnnne! "

PhonePower
Premium
join:2007-07-20
Winnetka, CA
kudos:1

Re: Dane Jasper for President

Dane is a good guy and an astute businessman with real no nonsense, back to the basics approach to providing services and customer service.

said by chex383:

I love this guy so much.

Amid a industry filled with cynicism, greed, sloth and pure laziness, this guy is a shining beacon in the fields of Mordor.

Dane for Pres in 2012!!

-- Stefan, dealing with the worst capping you can imagine in Canada..


doublea

join:2007-06-04
Petaluma, CA

Go get em sonic.

I love how this little ISP baised out of the county i live in proves a point and proves what a real ISP is.
WhatNow
Premium
join:2009-05-06
Charlotte, NC

Build your own

All of the 3rd party ISPs are welcome to build their own last mile networks and then cap or not cap.
Many do not really do anything but sells and billing. AT&T does all the work and service. When there is a problem it gets reported as a line problem so the network company goes out and determines if it is a user problem or the network problem. That saves the 3rd party a fortune in vehicles and payroll for techs.

Not saying AT&T does a great job providing internet service but streaming has changed that world. The DSL world was set up for e-mails and static web pages not streaming. The customers have put much greater demands on the system but not much more revenue is coming in to upgrade the system to handle the streaming video data.
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

Re: Build your own

said by WhatNow:

All of the 3rd party ISPs are welcome to build their own last mile networks and then cap or not cap.
Many do not really do anything but sells and billing. AT&T does all the work and service. When there is a problem it gets reported as a line problem so the network company goes out and determines if it is a user problem or the network problem. That saves the 3rd party a fortune in vehicles and payroll for techs.

Not saying AT&T does a great job providing internet service but streaming has changed that world. The DSL world was set up for e-mails and static web pages not streaming. The customers have put much greater demands on the system but not much more revenue is coming in to upgrade the system to handle the streaming video data.

AT&T's copper lines were built with taxpayer funds decades ago. You're making excuses for them. "Greater demands" have always risen alongside dropping bandwidth costs. Technology advances and routers/switches have become exponentially faster.
Arty50
Premium
join:2003-10-04
said by WhatNow:

The customers have put much greater demands on the system but not much more revenue is coming in to upgrade the system to handle the streaming video data.

Last time I checked, AT&Ts profits have been fairly healthy the past few years. They could easily afford to upgrade their network, yet they don't...

DustySilicon

join:2002-10-06
Oak Grove, MO

Money, Money, Money.

I think someone in finance/marketing suggested that gigabytes really should mean "Gigya Bytes"... just say'n...

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