Per-Byte Broadband Billing Is Neither Necessary Nor Inevitable

That makes no sense. You are getting usage and customers mixed up.
With a flat rate when they get an influx of new customers and they will make more money right away from the flat rate fees.
Also, electricity rates are regulated, the cost of a byte is not. Consumable electricity generation cost is also variable based on how much electricity is generated. The cost of building a network is fixed and electricity usage is basically fixed (since its price is regulated). Regardless if you are only using half the bandwidth of a strand of fiber or all of it, the cost does not change.

Everything with an ISP is a fixed cost. They pay for the internet connection, they pay for equipment, they pay for tech support, etc. It makes no sense to have a variable pricing when all the costs you have is fixed based on the number of customers you have.
They have to pay the full network costs regardless if customers use their full connections or not.

All these companies will do with pay per byte is set a high per byte price that at least give them the same amount of money they get with the fixed pricing so they can still pay all their fixed costs. Then what happens is the customers that actually use their internet connections get gouged with higher fees while very few people who barely use their internet connections actually save some money.
If they actually had a fair realistic pay per byte fee where they divided up the fixed costs by how much bandwidth they have available then we would all be paying less and they would lose money.

Why would you want customers to pay higher fees?

It's pretty much already there. Flip through some channels on the teli, or even go out to a store and listen to people.

espaeth

You know very well that ISPs do NOT pay by the gigabyte. Both their transit costs and hardware cost are solely based upon peak Mbps. So ANY GBs downloaded during off peak hours incur no additional costs (as in zero) for the ISP.

Not really an option in a lot of markets.

Then move. People move all the time for access to better schools, jobs, transit access, parks, etc. Why should broadband access be any different?

ISP shouldn't charge for this. They want us as a customer. That is simply the cost of doing business. Next thing you know we will all have to start paying every company in our area because there is a wire or pipe to our homes. I mean, someone needs to maintain those pipes and wires....

All of this should be in the price of the service...
Remember, customers care about the bottom line...

Please point out where I said they did.Which is exactly what I stated.

While I agree that a fixed base charge is reasonable and correct, charging based upon GBs downloaded is not related to the ISPs costs( so the car analogy fails here). Both transit costs and hardware costs are entirely based upon peak Mbps. Any GBs downloaded during non peak hours incurs no additional costs for the ISP, yet they want to charge for them. Since their costs are related to peak Mbps and their (current) tiers are priced by Mbps, the current situation(flat rate) is fair. IF they temporarily need to handle traffic issues during peak hours they can implement proticol agnostic throttling such as what Comcast uses(again temporarily, during peak hours, until capacity can be upgraded). Just look at the ISP's filings, they are not even close to loosing money on the internet side.

espaeth

Get real. While people do often move for better jobs, only an extremely few move (as in the distance to a market with more ISP options) for the other reasons you listed. All the other reasons you listed you can usually just move to a different section of a town to improve. In most towns one cannot move to another area within the same town(or metro) and change the ISPs one has access to, for the most part each town(or metro) has just one set of choices for ISP.

I should have said we need to buy pro-people lobbyists.

well in canada, they charge 1 dollar per gigabyte so your 10cents is way off

Edit:speelin

First I believe his entire post was meant in sarcasm.

Second, the only thing CRUEL AND UNUSUAL about any punishment is that it is not done enough and quick enough to those that deserve it. Don't do the crime if you can't do the time.

Third, you get what you pay for in life. Because we have spent decades fostering the weak to build even more weak instead of letting the process of natural selection take it's course as it does in every other species on this earth does not mean the strong should have to guarantee someone can get that liver transplant because they drink them self half dead.

That only works until you saturate a market to the point that new subscriber sign-up rates drop off. Of course, the barrier for entry is huge for new providers; the cost of broadband is artificially low because existing cable plant is being leveraged in the majority of installations. Telcos and MSOs were able to leverage a vast copper cable plant already in the ground paid for by the high profit margins of other services deployed on those lines for decades. Nobody can complete to just come in and offer a data-only service offering, which is why you are seeing even in the case of muni deployments that they need to supply the triple play of phone, TV, and Internet to make the cost structure work.Electric utility rates are not regulated in every state, and the cost is not per byte -- it's in the percentage of infrastructure consumed by utilization. That's why it's a sliding scale at various points along the network and there isn't a fixed "per byte" cost universally.Once you reach the capacity of your infrastructure it's forklift upgrades to provide expansion. Capacity upgrades are not linear, it's a step function. You want to improve DOCSIS cable rates, you have to replace your CMTS with one that supports DOCSIS 3.0. You want to upgrade to ADSL2+, you need to replace all of your field DSLAMs to units that support the new protocol.You're leaving out one massive variable: oversubscription. The sum total of all of the subscriber access connections is greater than the capacity of the ISP's network. As usage at the edge increases, elements of the network must be upgraded to support the greater capacity demand. If the network were provisioned at 1:1 even throughput you would never be able to afford your broadband connection. (look at the pricing for T1, DS3 services as a start to index on pricing)I want a model that supports growth. If I want to consume 1500GB/mo at home, I want a system in place that would both allow me to do that and provide a financial incentive for companies to grow their network to be able to sell me more bandwidth. That model has delivered massive gains to the web hosting market space over the last few years, there is no reason that it couldn't deliver the same possibilities for end-user access.

Flat rate supports growth. They just have to set a price that is profitable for them and can fund their upgrades.
If you saturate the market and your price is set correctly then you are making so much money you don't have to worry about ripping your customers off with per byte billing.
If they oversubscribe they get more money from the extra customers to pay for upgrades.
Problem solved.

If you actually do a fair implementation of per byte billing (all the fixed costs divided by the available bandwidth) then they will not be charging enough to afford to upgrade anything unless their available bandwidth is always maxed out.

Flat rate is fair and gives them the money to hire employees, upgrade equipment, and to provide bandwidth. Fair per byte billing will put them out of business.
If there are people that do not want to use all of their bandwidth then, oh well. The fee is for a 24/7 connection, just because you do not use it 24/7 does not mean all the fixed costs to provide that connection just disappear.

A flat rate is the fairest way to pay for the network and to keep it funded for upgrades.

How do you figure an ISP's bandwidth is a fixed cost? And there bandwidth transportation? And their electric costs which rise with usage? And their maintenance which rises with usage? And on and on. Rent, Leases and such are fixed costs. Not most other costs. Truck rolls increase with usage and do support costs. What is your business experience?

Don't get me wrong, I love the current flat rate structure, but the ISP does not have nearly as much control under this type of system.

By offering flat rates, as the technology moves forward and the speed and latency improves, it opens the door for innovative new products to establish themselves in the market, and with these new products comes consumer demand. The ISP's want to have as much control over when and where they spend resources on improvements. A per-byte billing structure offers far greater control over this aspect, as a properly implemented billing strategy would force customers to ration their bandwidth usage, while creating the ability for the ISP's to manage their revenues more precisely.

It's the dumb pipe panic. Per-byte billing is the most logical method for keeping things under control until the ISP's comes up with their own solutions that they can provide to customers in a way that just barely skirts the anti-competitive laws, gives them nearly exclusive control, and nets the largest profit.

That statement is SO WRONG. Directors have a fiduciary duty(that is a civil term and not criminal, so no illegality is involved) to maximize investors return on their investments.

And maximizing profit has NOTHING to do with customers paying more or less money. All customers can pay less, but if there are many more customers as a result, then profits can still be maximized, thereby satisfying fiduciary duty requirements.

Per byte takes the control away from ISPs and makes it harder for them to make the profit they want because monthly usage can change drastically.
Since all the costs are fixed regardless of usage if usage is low one month they are screwed.

It is simple since the costs are fixed and do not increase or decrease with usage it makes no sense to charge by usage.

JKM

Their bandwidth costs (both hardware and transit) are based on peak Mbps not GBs per month. The equipment has to be running 24/7 and the electricity use difference between fully loaded and idle is really minuscule. A fiber/coax/etc will require the same maintenance no matter what the load is on that transport media. How do you figure the number of truck rolls increase with usage? The two greatest enemies of this type of equipment is time and exposure(both of which are essentially a fixed cost).

If history is any indication of how the pricing would work, the ISP's are not going to create a situation that would cause them to lose money per subscriber. Nobody would be getting a price break with per-byte billing. The entry tier would be no less than your current, coveted fixed rate billing. The only difference would be the drastic change in the amount you would be able to download before incurring expensive overage charges, and they would probably create a "complimentary" tier that cost quite a bit more for those wishing to increase their monthly limits.

A per-byte format would never allow for 75% of the current internet subscribers to save a few dollars because of their limited amount of usage. That is not what this is about. It's all about making it impossible for anybody to use a bandwidth intensive product without either paying an outrageous amount of money, or by using something provided solely by the ISP, on their terms, and at their cost, with no legitimate competition.

More money is exactly why they would move to it.

If metered billing was necessary for their survival, all an ISP would have to do is show numbers proving it. They could put out details showing how they spend so much for bandwidth, so much for network maintenance, so much on labor costs and so on. No one has done so because it isn't true. The numbers on their 10-K forms prove it.

It's greed at it's worst. It's not enough to make a reasonable profit anymore, everyone is trying to impress the shareholders by showing a bigger gain quarter after quarter. They try to monetize everything. It's why they sell your personal info and browsing habits. Like I want you to "share" my info with "select" (read: anyone who can write a check) partners to offer me new and exciting products and services?

It's why ISP's have an illogical fear of being just an ISP. It's a sick cycle. You get a company who does one thing well and makes a decent profit doing it. Then they get greedy and decide they want to "diversify" and buy into different businesses which they think makes sense. This continues until they start losing money quarter after quarter. They eventually spin off or sell the failed businesses, putting out a press release saying it will allow them to "focus on our core business", which is where the focus should have been from day one. Meanwhile the customer has to pay for their mistakes in the form of higher bills (special thanks to Time Warner for allowing me to subsidize the money pit known as AOL).

I assure you that both my electricity bill and water bill are 100% based on usage. If I use electricity or water I pay for it, if I don't I don't. The ISPs want HUGE flat rates AND per byte billing. I am happy with flat rate OR per byte billing, but not both.

The ISP I speak of is a WISP, so the load on the radios does change the equation. The more use increases the more the customers have problems, more truck rolls. Usage does affect costs on the last mile infrastructure.

Don't get me wrong.......I don't support caps. Caps are merely the way the monopolies and duopolies, who control the middle mile infrastructure, discourage use.

+1

um thats about as silly a comment as it gets , and its proof of what i say , in fact here is a perfect example.

got me a job one day , so i moved to that town and got a room with a retired elderly man. P.S. ask a doctor how most stroke victimes recover with no one talking or interacting with them KEYWORD INTERACTION and seriously ask them if they had lack of mobility physically would the internet aid in mental health-if you find a doctor thats says it would not report the sicko cause ALL should say INTERACTION AIDS MENTAL HEALTH)
When i moved in he was almost bed ridden and hardly could look after his self. Didn't speak much and what not.

4 months later after simple hi's and little talks after work you can really see a change, so its not just the net that helps, but in fact allowing cheap affordable internet means a real human isn't always needed to get the communication centers going and stimulate a persons brain, and were not talking about disabled people 100% it can just be ANYONE ask a doctor buddy if its healthy to be stuck in a room or never talk to another person, in fact i say your prime candidate to try and never speak cause what comes out makes NO SENSE what so ever.

IT was ruled in Canada in fact to be against the law to place prisoners in solitaire confinement as it was CRUEL AND UNUSUAL PUNISHMENT under SECTION 12 of the CHARTER OF RIGHTS AND FREEDOMS. IF the supreme court of canada thinks its not fair to a person in prison to have no communication/contact with others.... why is it its ok to price gouge so bad that some disabled and elderly that use this to communicate should be any less then CRUEL and UNUSUAL PUNISHMENT to them as we have the power to make a lil less money and be a little less greedy and allow for some compassion to retirees and disabled. It should be a crime to do this to anyone intentionally. This might actually be a matter for lawyers to stick it back at the big telecoms that medically they are causing harm for a few cents on the share prices.

»www.canlii.org/en/ca/cha ··· -12.html
i would think that most people that undertake any research of the elderly and disabled would know what i really mean here when i say to treat them like YOU WOULD is abhorrent and dishonorable and cruel. While it might be legally weak or tenuous if enough people made noise it would gain enough political clout to get dealt with before a charter action was/would be required.

kinda like downloading a music tune and getting a 20500$ fine cause you had to rip it off a dvdr ( that had protections )
and i'll argue they would claim all the tracks on said dvdr as once protection is broken its broke for all the tracks.
Does a 300K + fine when we have a cdr levy sound CRUEL AND UNUSUAL? go read the link about fines and jail time to see what i researched and why i was VERY LOUD about jail times regarding BILL C61 and that all xvids are breaking a dvdr protection and thus are a 20000 fine and so are most music tunes on dvdrs....

P.S. before technology we stuffed people with mental health issues into homes and hospitals away form people and there eyes ....so problem doesn't exist. Today with interaction and better care they ( most ) can at least have some dignity......

AND 300K fine at 10$ per day ( the max ) is over 82 years in jail.
FOR a SINGLE DVDR of music

The FCC is poised to make metering inevitable by imposing "network neutrality" rules which prevent ISPs from shaping traffic and holding back bandwidth hogs. The only way for ISPs to prevent users from consuming more than they are paying for under such a regime -- and meet payroll-- will be to deter them with higher bills.

Wow... You really do like to wander about, don't you.

It's nice to believe that people can't do without the Internet and that, somehow, access to it should be some kind of "human right". However, just because you seem to believe that, it doesn't make it anywhere near approaching true.

Absolving the consumer of responsibility (once again) for maintaining their systems securely. Great.

I disagree that long distance charges were not flat rate from the beginning. They started out per minute’s usage. After being indenated with discrepancies over minute’s usage the Telco’s realized they were spending more on negogeating the billing complaints than making a profit for minute usage.

Bingo thank you!

Also these are "regulated" utilities granted local licenses for the privilege to operate as such. If these companies could charge $10,000 per person they would. These companies are of course for profit for their owners.

The local governments also has right and obligation to keep the companies in check from pillaging the people who live in that community.