ISP Bandwidth Caps are Really Rate Hikes(cringely.com)
cringely.com
ISP Bandwidth Caps are Really Rate Hikes
http://www.cringely.com/2011/07/bandwidth-caps-are-rate-hikes/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+ICringely+%28I%2C+Cringely%29
9 comments
What's surprising to me is that, at least with Comcast, there's simply no way to get the cap-free service I had before. I don't have the option to pay more to remove the cap (other than paying per gigabyte over the cap, which is silly).
Business service?
Yes, but it's expensive. I pay $89 + $10 for static IPs per month. The data rates I get: 50+Mbps/6Mbps. I torrent tv shows and I've never noticed any problems seeding. My downloads usually start out at 3-5MB/s, and drop down to 2MB/s. Clearly they are throttling the downstream, but I can live with that rate.
EDIT: I don't know what the advertised rates were, but they were less (20/5?).
EDIT: I don't know what the advertised rates were, but they were less (20/5?).
e40, what's the name of your plan? I can't seem to find rates like that on their site, the 50/20 plan is for 280 dollars.
On my bill it says: 16m Business Class HSI Preferred, for $89.95. The 5 static IPs are $9.95.
I don't remember there being a specific name for it.
I would not be surprised if they don't offer the exact thing anymore.
My advice, get some relatively low speed (16Mbps) and hope it's much higher, like I got.
I don't remember there being a specific name for it.
I would not be surprised if they don't offer the exact thing anymore.
My advice, get some relatively low speed (16Mbps) and hope it's much higher, like I got.
There was some discussion around this recently (e.g. my recent history for a link into it). My Comcast residential rate is approaching that level. Installation fee and lengthy commitment aside, it would make sense for me to switch to their low end business plan.
You might be onto something. Whenever I go through the available plans on Comcast's website, I'm sure it's only showing residential plans. I've never looked into business plans. My guess is they would be very expensive, and offer unneeded features like a static IP.
business service isn't that much more expensive than their 20Mbit service. i've been paying $75/month or so and the upgrade to business in my area is $15 more/month or so.
While I don't argue with the title of the article - bandwidth caps really are just a way to deal with infrastructure costs by passing it on to some consumers - the use of IP transit as a reference for an ISPs cost of service is inaccurate.
IP transit costs are what a carrier or ISP would pay to get traffic from their main datacenter/CO in a given metro area to the Internet. This is an operating expense and is a drop in the bucket compared to CapEx they spend on the last mile.
The cable operators and mobile carriers are freaking out because they are constantly pouring money into nodes splits and QAM carriers(cable) or radios, backhaul, and spectrum(mobile). These are the real money pits of their businesses and their motivation to enforce data transfer caps, throttling, etc.
IP transit costs are what a carrier or ISP would pay to get traffic from their main datacenter/CO in a given metro area to the Internet. This is an operating expense and is a drop in the bucket compared to CapEx they spend on the last mile.
The cable operators and mobile carriers are freaking out because they are constantly pouring money into nodes splits and QAM carriers(cable) or radios, backhaul, and spectrum(mobile). These are the real money pits of their businesses and their motivation to enforce data transfer caps, throttling, etc.
I don't understand why ISPs aren't offering some benefit to their users when they introduce these transfer caps. Why not add caps to the lower plans and lower the price as well? If it's true that the vast majority of users don't get anywhere near the caps, then this would be beneficial to most users.
For heavier users, offer a plan with no cap (or, say, a cap 10x larger) and higher speed, and charge more for it. I think power users would be much more accepting of a price increase along with higher speeds than a simple addition of caps to all plans with no price change.
For heavier users, offer a plan with no cap (or, say, a cap 10x larger) and higher speed, and charge more for it. I think power users would be much more accepting of a price increase along with higher speeds than a simple addition of caps to all plans with no price change.
In the US, cable companies are often monopolies in providing broadband internet. They get away with offering mediocre product and poor service simply because there are no alternatives.
I've had the backwards situation where it was cheaper to buy basic cable TV + cable internet than stand alone cable internet.
It would be foolish of them to offer a cheaper, limited cable internet plan when they can make everybody pay more for their standard, unlimited (that is not unlimited) plan.
I've had the backwards situation where it was cheaper to buy basic cable TV + cable internet than stand alone cable internet.
It would be foolish of them to offer a cheaper, limited cable internet plan when they can make everybody pay more for their standard, unlimited (that is not unlimited) plan.
From my small town of 10,000 people, to my college town with 100,000, to my current home in San Francisco, there has always been at least two broadband providers: usually the local cable company and AT&T DSL. Perhaps this isn't the norm, or perhaps two companies with completely separate local infrastructures isn't enough competition.
DSL is not good competition for any reasonable cable internet service. In Pittsburgh Comcast's $60 a month service is 5 times the speed of the $25 a month 1-3 mbps DSL service offered by Verizon DSL. The DSL connection is barely enough for reasonable quality video streaming, but it's not enough if you want to have two people use pipe at the same time. FIOS does provide decent competition but it's availability is limited.
I'm not sure if whichsituation is "the norm", but my area (southwest Georgia) and many surrounding communities only have one cable choice. In some of them there is a public option as well, but not many.
This is substantially what AT&T has done for the iPhone data plans.
200MB - $15/month 2GB - $25/month
Albeit without the higher speeds.
200MB - $15/month 2GB - $25/month
Albeit without the higher speeds.
The default 2Gb wireless internet cap from Verizon is pathetic.
It is even more pathetic with their 4G network advertisement. All it takes is 1(maybe 2) HD movies from Netflix to hit a monthly cap.
It is even more pathetic with their 4G network advertisement. All it takes is 1(maybe 2) HD movies from Netflix to hit a monthly cap.
Just playing devil's advocate here... Is the wireless cap really a bad thing? I have a 2GB cap right now. I still stream music, surf and watch the occasional YouTube video. I haven't gotten close to the cap yet. I pay about as much as I did for "unlimited" and the biggest impact is that I now keep track of how much data I'm using. Yeah, it's annoying. It's easier to have unlimited and not have to think about it. But I also don't want a wireless internet experience that's as slow as molasses because everyone is walking around streaming Netflix day and night or some cheapskate has decided to use his smartphone as his home internet connection. I can deal with caps as long as they are reasonable and periodically adjusted to account for increasing demands of mobile apps and sites.
>But I also don't want a wireless internet experience that's as slow as molasses because everyone is walking around streaming Netflix day and night or some cheapskate has decided to use his smartphone as his home internet connection.
Do you have any evidence of how common this behavior is or what impact it actually has on the network?
ISPs claim that the vast majority of their users won't be affected by data caps, but they also claim that heavy users significantly degrade performance for everyone. Those two statements usually seem contradictory to me.
Do you have any evidence of how common this behavior is or what impact it actually has on the network?
ISPs claim that the vast majority of their users won't be affected by data caps, but they also claim that heavy users significantly degrade performance for everyone. Those two statements usually seem contradictory to me.
the 2-5 GB caps are for wireless networks, aka 3G. How often do you download HD movies onto your phone? In the very next sentence it mentions 250 GB for desktop connections.
The point is that today we don't hit the caps, but metaphorical-tomorrow, we will hit them and it will be too late to change the precedents set today.
Netflix client has been out on Android phone OS for awhile and is quite popular.
http://www.verizonwireless.com/b2c/mobilebroadband/?page=pla...
Default data plan for smart phone is $30/mo, capped at 2Gb/mo, on a 4G network.
Their maximum cap is 10Gb/mo for an outrageous price of $80/mo.
It is evident that the whole point of 4G network for Verizon is to bring their customer to the monthly cap at a blazing speed and start over-charging them by $10/Gb as soon as they can.
http://www.verizonwireless.com/b2c/mobilebroadband/?page=pla...
Default data plan for smart phone is $30/mo, capped at 2Gb/mo, on a 4G network.
Their maximum cap is 10Gb/mo for an outrageous price of $80/mo.
It is evident that the whole point of 4G network for Verizon is to bring their customer to the monthly cap at a blazing speed and start over-charging them by $10/Gb as soon as they can.
Ya know, I can't help feeling that this quote is apropos:
"Everything is amazing, and nobody is happy." --Louis C.K.
It used to be the case that you couldn't get ANYTHING approaching 5mbps download speed in your home. Now we regularly get 15, 25, and even 50mbps download speeds.
You also couldn't get decent wireless data. Remember EDGE? 1xRTT? Try streaming Netflix back then.
I remember Airphone and using a MODEM to get 9600bps data so I could send an urgent IM and followup email via the Airphone on a flight to a co-worker. Now I can get GoGo inflight internet pretty regularly. I'm looking forward to my next transatlantic on Lufthansa when I can have access to the Internet for almost the entire flight.
Need high-speed internet out in the middle of NOWHERE? You can get two-way high-speed Internet via satellite for a very reasonable sum.
It's all amazing and nobody is happy.
I've spent the past 20 years working in the Internet industry for almost EVERY major ISP out there. It's quite disheartening to see your router capacities double every two years when you're locked into a 7-year depreciation cycle for network hardware. Ditto for long-haul transmission.
This wireless is different? Maybe you weren't there for the tower space leasing negotiations I witnessed. You think broadband is expensive? Try sticking 3 antennas along with hardline 150' up a pole and tell me that your broadband is expensive when you see the monthly bill for tower leasing for a SINGLE site.
WOW.
The long term trend for high-speed internet pricing is DOWN. We get more and more downstream and upstream capacity per dollar with each passing year. Wired AND wireless. What was once IMPOSSIBLY expensive is only going to get less so in the future.
I used to pay $12.80 PER HOUR for 1200bps access.
BTW, You're Welcome.
Too expensive? Don't pay it. I think you can still get a 56kb modem on Ebay. Dialup ISP service is something like $7.95/mo now.
And that's in 2011 dollars.
"Everything is amazing, and nobody is happy." --Louis C.K.
It used to be the case that you couldn't get ANYTHING approaching 5mbps download speed in your home. Now we regularly get 15, 25, and even 50mbps download speeds.
You also couldn't get decent wireless data. Remember EDGE? 1xRTT? Try streaming Netflix back then.
I remember Airphone and using a MODEM to get 9600bps data so I could send an urgent IM and followup email via the Airphone on a flight to a co-worker. Now I can get GoGo inflight internet pretty regularly. I'm looking forward to my next transatlantic on Lufthansa when I can have access to the Internet for almost the entire flight.
Need high-speed internet out in the middle of NOWHERE? You can get two-way high-speed Internet via satellite for a very reasonable sum.
It's all amazing and nobody is happy.
I've spent the past 20 years working in the Internet industry for almost EVERY major ISP out there. It's quite disheartening to see your router capacities double every two years when you're locked into a 7-year depreciation cycle for network hardware. Ditto for long-haul transmission.
This wireless is different? Maybe you weren't there for the tower space leasing negotiations I witnessed. You think broadband is expensive? Try sticking 3 antennas along with hardline 150' up a pole and tell me that your broadband is expensive when you see the monthly bill for tower leasing for a SINGLE site.
WOW.
The long term trend for high-speed internet pricing is DOWN. We get more and more downstream and upstream capacity per dollar with each passing year. Wired AND wireless. What was once IMPOSSIBLY expensive is only going to get less so in the future.
I used to pay $12.80 PER HOUR for 1200bps access.
BTW, You're Welcome.
Too expensive? Don't pay it. I think you can still get a 56kb modem on Ebay. Dialup ISP service is something like $7.95/mo now.
And that's in 2011 dollars.
I can't disagree. Perhaps it's all the Netflix, Dropbox and Youtubes that are way ahead of what wireless infrastructure can currently support. And frankly, it is those cloud services that steal the spotlight not the ISPs.
Although, having unlimited 56kb connection and downloading non-stop for a month (maximum utilization on customer's end with whooping 3kbyte/s) would result in roughly 7.5 Gbytes of downloaded data per month. Which is still 4x the standard 2Gb limit set by cellular phone companies. Not to mention cheaper.
Although, having unlimited 56kb connection and downloading non-stop for a month (maximum utilization on customer's end with whooping 3kbyte/s) would result in roughly 7.5 Gbytes of downloaded data per month. Which is still 4x the standard 2Gb limit set by cellular phone companies. Not to mention cheaper.
Ya know, I can't help feeling that this quote is apropos:
"Everything is amazing, and nobody is happy." --Louis C.K.
Whenever this point is raised, I always argue that human progress depends on the amazing becoming commonplace, luxuries becoming essentials, etc. If we were always walking around being bewildered by everything, we'd have no reason to improve.
"Everything is amazing, and nobody is happy." --Louis C.K.
Whenever this point is raised, I always argue that human progress depends on the amazing becoming commonplace, luxuries becoming essentials, etc. If we were always walking around being bewildered by everything, we'd have no reason to improve.
My main point was to illustrate just how far we've come in absolute terms.
My second point was to point out that there are real reasons why the assumptions made about what broadband "costs" aren't really relevant to what you "pay" for it.
Without putting too fine a point on it, CAPEX on equipment/fiber tend to be dwarfed by the OPEX of leasing and labor costs associated with running a telecomm business for profit. Somewhat distended depreciation schedules mandated by GAAP compound the problem of removing obsolete assets from production networks and replacing them with newer equipment.
BTW, pricing for "Internet" has been "metered" almost from the beginning of commercial availability. UUNET did 95th percentile pricing for almost all of its dedicated access customers because that was the best way to tie consumption patterns to bandwidth availability.
If bandwidth seems expensive now, it's only because you've been paying for it for a very, very short time.
My second point was to point out that there are real reasons why the assumptions made about what broadband "costs" aren't really relevant to what you "pay" for it.
Without putting too fine a point on it, CAPEX on equipment/fiber tend to be dwarfed by the OPEX of leasing and labor costs associated with running a telecomm business for profit. Somewhat distended depreciation schedules mandated by GAAP compound the problem of removing obsolete assets from production networks and replacing them with newer equipment.
BTW, pricing for "Internet" has been "metered" almost from the beginning of commercial availability. UUNET did 95th percentile pricing for almost all of its dedicated access customers because that was the best way to tie consumption patterns to bandwidth availability.
If bandwidth seems expensive now, it's only because you've been paying for it for a very, very short time.
My first encounter with the Internet was on a 10hr/mo. dial-up connection with a 14.4kbps modem, and I'd been using BBSes before that. I definitely appreciate how far we've come :). Still, ISPs have reached the point where they're holding back technological progress to satisfy their own ends. Municipal fiber projects and independent ISPs often don't impose the same restrictions as the monopoly players, which suggests that it's possible to run a network without, for example, forcing Netflix to pay an extra fee on top of its existing bandwidth payments.
So does the extended depreciation force equipment owners to pay the taxes they would've written off for the extra years if they just disconnect the equipment and let it sit in a closet?
So does the extended depreciation force equipment owners to pay the taxes they would've written off for the extra years if they just disconnect the equipment and let it sit in a closet?
How many municipal ISPs are there? Municipal fiber companies?
Careful. I used to work for a municipal fiber company and they are FAR from being the best group to build the kind of Infrastructure we need. Don't even get me started on the problem of politicizing the communications infrastructure of a city.
The only path forward is for us to get some real competition between the cablecos and the telcos.
Careful. I used to work for a municipal fiber company and they are FAR from being the best group to build the kind of Infrastructure we need. Don't even get me started on the problem of politicizing the communications infrastructure of a city.
The only path forward is for us to get some real competition between the cablecos and the telcos.
Thanks for those normalized graphs. Really gives a striking visual rebuttal to ISP's baseless claims.
Does anyone feel that the new white space standard (up to 22Mbps over 12,000 sq mi; 802.22) could be a game changer?
Original article was posted here yesterday: http://news.ycombinator.com/item?id=2814917
Cross-posting my question from this thread:
Is this spectrum encumbered by any regulations that would prevent an enterprising individual from leasing some land near a backbone connection and setting up a startup ISP?
Would LOVE to see the regional cable monopolies face real competition. 22Mbps is about 30% more downstream and 4000% more upstream speed than I get from Time Warner Cable in NYC.
Original article was posted here yesterday: http://news.ycombinator.com/item?id=2814917
Cross-posting my question from this thread:
Is this spectrum encumbered by any regulations that would prevent an enterprising individual from leasing some land near a backbone connection and setting up a startup ISP?
Would LOVE to see the regional cable monopolies face real competition. 22Mbps is about 30% more downstream and 4000% more upstream speed than I get from Time Warner Cable in NYC.
22 Mbps shared by hundreds or thousands of customers is much worse than cable or DSL. You can already do ~100 Mbps at decent range in 2.4 GHz using Ubiquiti or similar equipment; there are dozens of WISPs doing this and if they're lucky they barely break even.
Thanks Wes - If I understand correctly, it's the density of end-points within range that would determine whether the economics are favorable.
Wondering then, what is the use case for this new standard? Only very rural areas?
Wondering then, what is the use case for this new standard? Only very rural areas?
No. You're missing the point ENTIRELY.
As average bandwidth consumption PER ENDPOINT increases and moves from very bursty to somewhat constant bit rate, the effects up the cost chain start to chip away at the design parameters that went into building the infrastructure we're going to live with for some time. Replacing that infrastructure is costly so pricing pressure is used to delay that replacement event. It's all about ECONOMICS.
This is the case whether we're talking about urban or rural areas. It's definitely more acute when we're in a rural area, but the first-mile is only part of the cost of delivering b/w. The rest of that cost is driven by indirect factors.
Case in point: a very recent government regulation resulted in a network upgrade that cost $71 million in new hardware ALONE. Add in the labor costs associated with testing and installing all of that hardware and you're somewhere north of $100 million. That "upgrade" added not a single bit of capacity to the network.
As average bandwidth consumption PER ENDPOINT increases and moves from very bursty to somewhat constant bit rate, the effects up the cost chain start to chip away at the design parameters that went into building the infrastructure we're going to live with for some time. Replacing that infrastructure is costly so pricing pressure is used to delay that replacement event. It's all about ECONOMICS.
This is the case whether we're talking about urban or rural areas. It's definitely more acute when we're in a rural area, but the first-mile is only part of the cost of delivering b/w. The rest of that cost is driven by indirect factors.
Case in point: a very recent government regulation resulted in a network upgrade that cost $71 million in new hardware ALONE. Add in the labor costs associated with testing and installing all of that hardware and you're somewhere north of $100 million. That "upgrade" added not a single bit of capacity to the network.
Cringely doesn't mention ISPs' claims that they will increase the caps every year. I'm willing to wait for them to renege before breaking out the torches and pitchforks.
I wish it was just a rate hike. Instead, you are often simply cut off with no recourse for exceeding the cap. You can't pay more and get more.
If you're not granny checking her email and facebook, you're not welcome here.
I think its more about quietly but forcefully sending the message that your internet is not for tv.
If you're not granny checking her email and facebook, you're not welcome here.
I think its more about quietly but forcefully sending the message that your internet is not for tv.
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Paying 40$ a month instead of 30$ for an unlimited or very high amount of data means you'll grumble a bit, but you'll still do whatever you did before.
Going from a very high cap or unlimited to a very low cap + expensive additional data means you'll very probably try to restrict your data transfers and do whatever you can not to exceed your cap.
You don't have a sunken cost like with a normal rate hike..