Congressman: there should be a law against Internet caps(arstechnica.com)
arstechnica.com
Congressman: there should be a law against Internet caps
http://arstechnica.com/tech-policy/news/2009/04/congressman-there-should-be-a-law-against-internet-caps.ars
29 comments
I hate the idea of caps on my data transfers. I don't want to have to pay per-GB fees.
I also hate the idea of having to pay-as-I-go for LD telephone, for minutes on my cellphone, for gas to power my car. I mean, I paid almost $30K for my car; why should I have to fork out more money just to use what I've already bought? </sarcasm>
Really, I do hate it. But if we don't allow companies to make money by providing bandwidth, then no one will want to enter the market, and without competition we'll never get better or cheaper services.
I also hate the idea of having to pay-as-I-go for LD telephone, for minutes on my cellphone, for gas to power my car. I mean, I paid almost $30K for my car; why should I have to fork out more money just to use what I've already bought? </sarcasm>
Really, I do hate it. But if we don't allow companies to make money by providing bandwidth, then no one will want to enter the market, and without competition we'll never get better or cheaper services.
If we don't allow companies to make money by providing roads, then no one will want to drive!
Maybe you're right. Although they're rare, there is certainly precedent for private roads, and many of these are successful. For example:
"The Dulles Greenway is a private road built in the western suburbs of Washington, D.C., in 1995. Though constructed with some restrictions set by the state, it was built with private money and is run as a for-profit business. The first year it opened, 6.1 million trips were made on the road. In 2006, 21 million trips were made. This type of private toll road has the ability to move large numbers of people without the aforementioned problems associated with the federal interstates that we are told are indispensable. It has shown its viability, and we might well be seeing many more of these private toll roads in the future."
See http://www.fff.org/freedom/fd0809d.asp
That's an argument for making ISPs run by the government, which I'd be open to.
But we'd still have to pay for it. We do pay for the roads, it's just that we do it through taxes.
But we'd still have to pay for it. We do pay for the roads, it's just that we do it through taxes.
But I also recognize that a flat-fee for widely variable usage isn't sustainable for ISPs.
What information do you have that makes you recognize this?
What information do you have that makes you recognize this?
That it takes more expense to handle customers with higher bandwidth usage.
That it takes more expense to handle customers with higher bandwidth usage.
Which doesn't address why you think it's unsustainable. The business model for ISPs has always been been that the lower end user subsidizes the use of bigger consumers. I interpreted that you believe this model is losing it's viability and I am wondering what information you have that shows this. Or did I misinterpret your original post?
Edit: Not to mention that I've never understood how bandwidth caps actually address any problem that an ISP faces.
Which doesn't address why you think it's unsustainable. The business model for ISPs has always been been that the lower end user subsidizes the use of bigger consumers. I interpreted that you believe this model is losing it's viability and I am wondering what information you have that shows this. Or did I misinterpret your original post?
Edit: Not to mention that I've never understood how bandwidth caps actually address any problem that an ISP faces.
...problem that an ISP faces.
The idea is to prevent people from canceling cable and using the internet to watch TV not to cover costs.
The cable company costs are well below than 10c per GByte used, but that's not going to prevent users from watching video online so they bump things well over 10 times their true cost. In the end it's a win / win either people keep cable or they milk those who switch.
The idea is to prevent people from canceling cable and using the internet to watch TV not to cover costs.
The cable company costs are well below than 10c per GByte used, but that's not going to prevent users from watching video online so they bump things well over 10 times their true cost. In the end it's a win / win either people keep cable or they milk those who switch.
What I stated in my original post: more people will be big consumers of data.
So? Why does that mean their business model is unsustainable? Do you have a reason to expect that bandwidth consumption will grow faster than the ISPs can keep up or are you just guessing?
Of course I'm guessing. It just seems like an obvious guess to me - specifically, that people's bandwidth usage will start to resemble other utilities. I'm surprised you find it a controversial guess.
I don't necessarily find it controversial, just that I haven't seen enough evidence to suggest that's it is correct. So when people make the statement, I like to find out if they are guessing or if they have more information than I do on the subject. Perhaps that wasn't clear from my initial response.
> That it takes more expense to handle customers with higher bandwidth usage.
It doesn't cost any more to set up their accounts and bill them. It doesn't cost any more to run the wires.
There is some marginal cost for bandwidth. There are some third order router-cost effects. There are some fourth-order power effects.
Note that time of usage has a huge impact on costs. Someone who downloads 1GB/month at peak periods is more expensive than someone who downloads 250GB/month at off-peak.
It doesn't cost any more to set up their accounts and bill them. It doesn't cost any more to run the wires.
There is some marginal cost for bandwidth. There are some third order router-cost effects. There are some fourth-order power effects.
Note that time of usage has a huge impact on costs. Someone who downloads 1GB/month at peak periods is more expensive than someone who downloads 250GB/month at off-peak.
The problem is that the ISPs' approach has little to do with passing their costs on, and more to do with holding back new forms of media distribution. Price/GB should be nonincreasing, with a nonnegative connection cost. I've seen pricing plans with $50 for 250GB, but $1.50/GB overage. Clearly, the fixed cost is not -$100, but is intended to punish heavy users rather than selling them what they want.
Ridiculous. Should providers be able to advertise unlimited access and then limit access? No. Should limited access be illegal? No.
I'm amazed how comfortable people are with low usage customers subsidizing high usage customers. It strikes me as profoundly unfair. ISP's are no angels, I know, but I'm not talking about any specific case, just the notion of caps in general.
As long as the pricing is fair I think tiered/capped traffic agnostic pricing is fine. I think some people are caught up in their general disgust with what they see as regional monopolies, and directing it at this general issue.
As long as the pricing is fair I think tiered/capped traffic agnostic pricing is fine. I think some people are caught up in their general disgust with what they see as regional monopolies, and directing it at this general issue.
Caps are perfectly fine as long as they are sufficient - but what happens when the ISPs want to better utilize their bandwidth, and decide to lower their limits, rather than increasing their capabilities? There's no regional competition to worry about, so there would be no incentive to add capabilities when the alternative is basically free.
I completely agree. They can either have (publicly advertised!) caps OR they can do traffic shaping. Not both. Honestly ISP's need to move their entire offering to a "business-class" level of service (tiered, published data prices, some level of uptime guarantees), without the price gouging. I don't mean more data/more uptime, just more visibility. Let me pick my "tier" and then provide me that service.
For a moment, let's consider a local coffee shop (or, for that matter, Starbucks). As a libertarian, I believe the pricing model for a cup of coffee is the owner's decision, not the government's. Pay for each cup, pay less for subsequent cups, free refills...none of my business. If I don't like it, I can go to another coffee shop or open up my own.
Pipes and wires to my house are a different manner. Unlike with the coffee shop, my local government gave a company an exclusive right to serve my house. No competing companies can run redundant pipes or wires if the original companies aren't offering up good deals. While its debatable whether or not government should offer such exclusivity, it has. So, without government intervention, the companies granted these rights will raise prices to the point of profit maximization -- a level of profit that would lead a rational bidder to pay tons for the exclusive license to serve my town. Think cellular frequency auctions. Instead of auctioning off rights as a means of indirect tax collection, most towns (or states) granted basically free exclusive licenses with the caveat of pricing and service oversight. The natural gas monopoly has to petition the state (at least in Ohio) to raise rates. And, I think the cable companies have to petition the local municipalities. So, I don't blame these companies as they're just doing what their contracts (might?) allow. Instead, I find fault with the local governments for selling their citizens short with bad contracts or oversight boards. Who's watching these government-imposed monopolies?
Pipes and wires to my house are a different manner. Unlike with the coffee shop, my local government gave a company an exclusive right to serve my house. No competing companies can run redundant pipes or wires if the original companies aren't offering up good deals. While its debatable whether or not government should offer such exclusivity, it has. So, without government intervention, the companies granted these rights will raise prices to the point of profit maximization -- a level of profit that would lead a rational bidder to pay tons for the exclusive license to serve my town. Think cellular frequency auctions. Instead of auctioning off rights as a means of indirect tax collection, most towns (or states) granted basically free exclusive licenses with the caveat of pricing and service oversight. The natural gas monopoly has to petition the state (at least in Ohio) to raise rates. And, I think the cable companies have to petition the local municipalities. So, I don't blame these companies as they're just doing what their contracts (might?) allow. Instead, I find fault with the local governments for selling their citizens short with bad contracts or oversight boards. Who's watching these government-imposed monopolies?
Personally, I'd kill for a 40GB cap. I live in South Africa and I've been paying around $30 per month for a 2GB international cap. I wouldn't at all be surprised if the average user in the US used less than 40GB per month.
That said, the idea of a law banning Internet caps is ridiculous, and could possibly do more harm than good.
That said, the idea of a law banning Internet caps is ridiculous, and could possibly do more harm than good.
The switch to internet cable/video is on the horizon. With services like Hulu and technologies like Boxee it is just a matter of time. Hopefully the cable companies will find a new way to make money, probably through on-demand content, and not have to actually start using this sort of bandwidth capping.
Internet access should become a public utility, since we've so badly screwed the pooch by creating monopolies by government fiat.
So the solution to these supposed monopolies created by government intervention is a monopoly created by the government?
The government might actually want to do something to improve our broadband standing in the world (in terms of the quality & adoption of our broadband). The current monopolies have no such motivation.
Not that I’d want to depend on the government to do so. But hey, can’t be any worse than the current situation, right?
Not that I’d want to depend on the government to do so. But hey, can’t be any worse than the current situation, right?
The government ought to put telcos and cable companies on the same level as data carriers then go away.
I can download movies, and play games. Broadband is currently fast enough for me to be happy. Why should we look at the rest of the world and complain. It's like the rich comparing themselves to the uber rich then complaining.
I can download movies, and play games. Broadband is currently fast enough for me to be happy. Why should we look at the rest of the world and complain. It's like the rich comparing themselves to the uber rich then complaining.
> But hey, can’t be any worse than the current situation, right?
Sure it can - it can impose censorship. It can be even friendlier to the RIAA/MPAA.
Sure it can - it can impose censorship. It can be even friendlier to the RIAA/MPAA.
If you thought the customer service at Time Warner was bad, have you ever tried replacing your Social Security card?
When I first saw the title I thought congress was trying to ban CRUISE CONTROL FOR COOL!
A little confused for a second when I realized what they were actually talking about, but then it made much more sense. Would have been funny to have a "YouTube Reform Act of 2009" or such though.
A little confused for a second when I realized what they were actually talking about, but then it made much more sense. Would have been funny to have a "YouTube Reform Act of 2009" or such though.
But it's not. It's finite. It seems obvious to me we need to move to the same model we use for electricity and water: pay for what you use.
What's strange to me is many of the people who I know are technically knowledgeable decry bandwidth capping, but don't propose a simple pay-for-what-you-use model. I agree that advertising infinite bandwidth and then charging for "overusage" is wrong. But I also recognize that a flat-fee for widely variable usage isn't sustainable for ISPs.