ISP Data Caps Just a 'Cash Cow' 353
An anonymous reader writes "Ars summarizes a new report into the common practice of ISPs implementing data caps, ostensibly to keep their network traffic under control. The report found a much simpler reason: money. Quoting: 'The truly curious thing about the entire debate has been the way in which caps have mostly remained steady for years, even as the price of delivering data has plunged. For example, paying for transit capacity at a New York Internet exchange costs 50 percent less now than it did just one year ago, and many major ISPs aren't paying at all to exchange data thanks to peering. So why don't prices seem to fall? ... The authors of the new paper contend that all explanations are more or less hand-waving designed to disguise the fact that Internet providers are now raking in huge—in some cases, record—profit margins, without even the expense of building new networks. ...While Internet users have to endure a ceaseless litany of complaints about a "spectrum crunch" and an "exaflood" of data from which ISPs are suffering, most wireline ISPs are actually investing less money in their network as a percentage of revenue, and wireless operators like AT&T and Verizon are seeing huge growth in their average revenue per user numbers after phasing out unlimited data plans—which means money out of your pocket. In the view of the New America authors, this revenue growth is precisely the point of data caps.'"
This is Market failure in action... (Score:5, Insightful)
... it must be faced for the US to whom the free market is as much a religion as anything.
Re:This is Market failure in action... (Score:5, Insightful)
OK, so how is that monopoly removed? (Score:5, Insightful)
You can't let someone dig up the roads because a person on the street has decided to change ISP.
You can't let someone use the radio bands willy nilly because there's a new customer for wireless internet.
It's rather the intent of every single Randian faithiest to INSIST that any failure in the Free Market is due to government interference.
Given that you INSIST they should do some things such as enforce contracts and prosecute theft, murder, et al, that there is ALWAYS going to be government interference.
One thing that always shows up the idiot libertarian is that they blame government interference without ever considering evidence for the stance. Just "Government exists? Well, they did it".
If government got out of it and stopped enforcing contracts, then the ISP customers would be able to not pay for the connection and that would fix the failure, wouldn't it? But that's not allowed, government MUST interfere then!
Re:OK, so how is that monopoly removed? (Score:5, Insightful)
Putting that bit of regulation back in place would probably spawn all sorts of consumer choice without having to deal with the barrier to entry that is laying physical lines.
Re:OK, so how is that monopoly removed? (Score:5, Insightful)
No, they need to go a step further than that, really. Regulation that states that no one entity can do any two or more of create content (media companies), deliver content (ISPs), or provide physical connectivity (last-mile line installation/maint.). That would pretty much solve the problem overnight, especially if the last bit was handled by municipalities or co-ops.
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Several factors are at play, and they all contribute to the problem.
Without going into too many specifics (it is late), the summation of all the failures comes down to the deregulation and the failure to prevent monopolies of the communications and media industry over the past 20 years. In fact, certain attempts to "deregulate" result in stronger regulation elsewhere that ultimately promotes and enforces monopolies in these industries.
From allowing certain companies to hold onto multiple media distribution
That doesn't work. See UK's BT. (Score:2, Insightful)
BT charge by the byte to all customers, this includes BT's provider arm, but that's no different to Starbucks paying huge amounts of money to their Swiss arm for ground coffee beans: it's fake difference, the money goes in the same pot.
And BT have a requirement to sell to others.
Except
a) they can delay and fuck things up and not be dinged for it
b) charge huge amounts for data
And therefore you have ABSOLUTELY NO CHANGE.
The holder of the wires MUST be a non-profit governmental institute.
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Would this Monastary-ISP bring back NNTP? Pretty please?
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Re:This is Market failure in action... (Score:5, Insightful)
The free market fairy simply cannot wave her magic wand over everything. The government cannot avoid playing a role in i.e. wireless communications if you want them at all. Someone has to decide who can use what spectrum. Someone has to enforce the rules. There is a finite supply - meaningful competition is not possible even when this is done efficiently. These are not like newspapers, where anyone can buy a printing press for relatively cheap. This is a multi-billion dollar cost of entry to put up thousands of towers on whatever spectrum you can license.
No amount of ideology can give you a laissez faire market in wireless broadband. Arguing otherwise just makes you sound like one of those old-line Soviet Communists trying to explain how the shortage of bread must be a Capitalist Conspiracy. You can deny reality as much as you want, but it won't fill your stomach, or give you a "free market" cellular internet connection.
Since we inevitably have to have a quasi-governmental broadband industry, I'm all for regulating it better. Fixing this is not rocket science. We did it for generations after our great grandparents got sick of enduring these scams. Set up a commission, give them unlimited fact-finding authority over the ISPs. They examine network load, operating costs, and approve new budgets and prices. Charter them to permit a steady, single-digit profit margin, while ensuring adequate ongoing investment and modernization. You know, how we used to run electric utilities for generations, before we privatized those and the rates jumped and the lights started going out all the time.
Doing anything else is bad for business. Letting ISPs price gouge is the same as letting congress pass a (largely regressive) tax increase. It's just one where the tax money doesn't even have the courtesy to visit the US Treasury on its way to some insider's pocket.
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not a free market.
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The free market fairy simply cannot wave her magic wand over everything. The government cannot avoid playing a role in i.e. wireless communications if you want them at all. Someone has to decide who can use what spectrum. Someone has to enforce the rules. There is a finite supply - meaningful competition is not possible even when this is done efficiently.
Right now there is a finite supply of spectrum, because all of our technologies are broadcast technologies. If we can find a way to shift from broadcast
Re:This is Market failure in action... (Score:4, Insightful)
Then you're head and shoulders above most Libertarians who think that the laws of markets overrule the laws of physics. It may be possible to come up with a technological solution to the limited amount of spectrum, but we don't have access to that technology yet.
I'm tired of people claiming that the free market would fix the ISP problem. If we just made the RF spectrum a free for all you'd have the wealthiest companies erecting radio towers everywhere and blasting out as many megawatts of power as they could to drown out their competitors. Everyone would suffer. Everyone would have lower quality of service. Same with physical infrastructure. I really don't want 10 different copper/fiber lines strung from the telephone pole to my house or my street being dug up every year to install new lines for a new company. We need ONE common infrastructure owned by the people collectively which is leased out to businesses who compete with each other. That's the only sane model.
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Only an idiot would suggest that ISP pricing has any chance of behaving according to Adam Smiths' idealized and theoretical free market. All others realize that the barriers to entry are so huge that meaningful competition cannot possibly occur - especially when any current player is large enough to just buy out any upstart with any chance of upending the status quo.
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That monopoly was removed back in the late '90s with the telecom act. I remember in 2000 when there were about 30 different DSL companies to choose from.
Now, there's 2. AT&T, and Comcast.
Those are the choices with no regulation.
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I disagree, the reasons the ISP's can continue to charge outrageous rates is because they have a government sanctioned monopoly on last mile delivery. Even if I wanted to setup a cable ISP I couldn't as I have no access. I could setup a telco based one using DSL, but I would be limited to the transit charges the owner (Centurylink in my case) wants to charge my customers.
Exactly. Instead of allowing competion, they fight it. DSL is required to allow competition because of the old regulations on the telephone lines that carry it. But Verizon and AT&T are changing the game by going to fiber instead, and letting DSL languish. Meanwhile, the Cable companies get contracts from the counties/municpalities to be the sole providers for the region so there is no competition in the same technology, and they're not required to share like the telcos are.
Even then, when communitie
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And yet municipal internet is widely known to have the best quality, speeds, etc, for the price.....
Funny how your extreme and another extreme are supposed to achieve at the same goal.... we know the municipalities are real.... then in the UK, the free market of ISPs is what drove the cost of HSI way way down... they made it so anyone can resell the last mile.
Both work. Its this half-assed market/gov crap that doesn't.
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not really
lots of ISP's like verizon have legacy money losing businesses like POTS lines, especially in flyover country where all the freedom lovers think everyone else should pay for their infrastructure
the current high growth business like wireless subsidizes POTS, DSL and whatever else they have
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POTS only loses money on paper because they write the paper in such a way that it appears to be losing money.
Saying POTS services are 'losing money' is roughly the same as saying 'The LOTR trilogy was unprofitable for everyone involved.'
Both are flat out lies.
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If you're an invisible hand, sooner or later you'll start robbing people, if not worse. Invisibility and not having a body can fuck with your mind that way... reminds me of the song "I Wouldn't Pee On You Unless You Were A Invisible Hand Because Then People Could See You And Attach You To A Spare Body Which Would Make You Happy And Me Proud" by The Helpful.
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Re:This is Market failure in action... (Score:4, Interesting)
I don't think you know what a free market is. The bandwidth market in the US is heavily, heavily government regulated.
If you think a free market it's something that is free from government regulation then I'm absolutely sure you don't know what it is. A market is a set or rules governing trade, a fundamental rule of all markets is property law, you are free to participate in a free market provided you play by the rules. A market without rules is an oxymoron, like much of the political debate in the US it's ideological nonsense.
A trivial example of a non-free market is the plutonium market, it's is an existing market but it's not free because it is not open to all players (nor should it be). Public bandwidth auctions are by definition a free market, without top down regulation of the radio spectrum there would be no bandwidth market, it would be replaced by a bottom up arms race in transmitter power. Utilities operate a lot better when the distribution network is treated as a single entity like roads and sewers, wholesalers and retailers then compete with each other over who can most efficiently build/use the same universal infrastructure. Much like construction companies and trucking companies compete to build bridges and deliver goods. It's bad enough telco's get to put their ugly poles on the public property directly in front of my house, worse still is the fact that these poles cause up to a third of all bushfires in my country. We went through the idiocy of rolling out two cable TV networks being rolled out side by side in the 90's, I really don't want more poles and wires just because corporations want to control rather than share infrastructure.
Forget all the "free market" babble, it's a mental cage that a lot of Americans have locked themselves in and thrown away the key. The questions should be more like what rules do we need to get the best outcome for all players in this particular market? What rules will lead to an expanding and innovative market? What about markets such as tobacco and alcohol, do we really want to expand those markets, should the rules be mindful of children or the fact that the products are unhealthy, should they be banned and therefore self-regulated by organized crime in so called "black markets"? Once these things are decided and implemented, does it work as advertised? They're the sort of questions that are asked and answered by genuine representatives of the people with the aid of a public service that is not afraid to speak truth to power.
Problem is that in the modern world we are overwhelmed by such questions and the self interested propaganda that accompanies them. It's physically impossible to understand every major issue in any depth, let alone come up with a sensible response. It's much easier to just ignore the details and take solace in a soundbite, the monorail guy from the Simpsons is much more entertaining than a bunch of dry academics, anyone who can sing and dance like that must know what they are doing, right?
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The market isn't free. Its government granted monopoly that makes it so the ISPs can pull this off.
If they weren't granted the monopoly rights by legislation, they couldn't get by with ripping people off because they'd have competition.
Again, the ISP world isn't 'Free Market' in America. Regulation created the problem as it exists.
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DSL (Score:2)
most people do not have a choice when it comes to wired Internet connectivity. I have access to Comcast and no other ISP for connectivity.
I thought most customers in urban or suburban areas lived within 3 kilometers of a DSLAM and could thus get DSL.
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well, of course (Score:5, Insightful)
Just about anything a mobile phone company does is aimed at maximizing revenue. The reason they would even pretend otherwise is that it can be easier to convince people to pay more for things, and avoid being as angry about it, if you can feed them some kind of cover story to mollify them.
Re:well, of course (Score:5, Insightful)
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Re:well, of course (Score:5, Insightful)
This, along with credit card companies raising your rate after you borrow a lot because you're "riskier", coincidentally trapping you and making it hard to pay off, and banks charging you overdraft fees, $35/incident, over and over to "protect you", are a nice trio of fine print fraud.
In all cases, the surface argument has the lie put to it because their business model hopes you get into trouble, and the business doesn't fear it. It is the desired state.
It is thus fraud and should be treated as such.
Neither a borrower nor a lender be (Score:2)
This, along with credit card companies raising your rate after you borrow a lot because you're "riskier"
How does that affect people who follow Dave Ramsey's advice not to borrow? Or even people who follow Polonius from Hamlet?
Debit cards (Score:5, Interesting)
This is why the major credit card companies keep trying to make it really hard to make major purchases without using one of their cards.
Using a card doesn't always involve carrying a balance. I use two credit cards regularly, one Chase Freedom Visa (1.1% cash back) and one Target REDcard (5% cash back), and I have both set to pay the entire statement balance in full each month. So I treat the credit cards as if they were debit cards: if I don't have the money in the checking account, I don't swipe the card.
Re:Using Credit Cards as Debit Cards (Score:4, Informative)
...and why do they allow you to do that?
It's simple. They know that otherwise you'd be too smart for their scheme and wouldn't even have a credit card come the day that you happen to need more cash than is in your checking account.
Blah blah blah blah then you never actually state the actual reason why they permit that, which tells me you don't know what you're talking about. Store credit cards encourage people to shop with a given store. On other cards, the processor takes a cut of every transaction. There's money to be made even if you don't carry a balance, which is the reason credit card companies don't cancel cards that never have one.
Average consumer intelligence level declining. (Score:2)
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You aren't really familiar with how cable TV worked, are you?
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Re:Average consumer intelligence level declining. (Score:5, Insightful)
No, you're the clueless one. When cable first came out in the early eighties (it was around in a very limited form in very few places in the seventies) there was no advertising whatever. None. Not on the cable channels; the only time you saw a commercial was when you were tuned to an over the air channel. Uncut, uninterrupted, commercial-free TV. Then when everybody got hooked on cable, THAT is when they started introducing ads... between shows. Then they started breaking the shows for commercials like OTA TV. Then they got even greedier and started showing commercials at the bottom of the screen while the actual content is playing.
No, son, YOU are the one unfamiliar with early cable, simply because you never saw early cable and assumed it was always fucked up like that.
Guess what else? Empty-V used to play music videos instead of stupid "reality" shows. Discovery used to have science instead of "trick my truck." History used to have the history of the Roman Empire and the History of Beer instead of "ice road truckers."
Guess what else? I shut my cable off. It's no longer worth the money. OTA, DVD, and web for me. Comcast can go fuck themselves, the greedy, shiftless bastards.
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I too would shut mine off if it were not for Bernie Ecclestone being such a greedy git and not selling F1 feeds online :(
Obvious article is obvious? (Score:4, Insightful)
Cellular the same way (Score:3)
However, there is an exception. Satellite internet it makes sense right now for their to be caps. It's a behavior adjuster. A single satellite can only transfer so much data at once
In theory, caps on cellular (3G and 4G) data are the same way because of limited spectrum and limited space to put up cell towers. Except for some reason, cellular doesn't have an off-peak discount like satellite does.
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Am I the only person who has known this for years?
Anyone that's cared over this past decade has known, the problem is not enough of us care.
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I don't mind such a model. Bandwidth for wireless or landline is finite. At times when that finite resource becomes scarce due to high usage, a higher charge or a bandwidth cap makes sense. Or for cellular, pay more for a plan that isn't subject to the bandwidth caps, and the rest of us who don't care so much can live with the cap. Note bandwidth caps to adjust to traffic patterns, not a data amount cap. You normally have 4 Mbps, but it's rush hour on the networks so you only get 1 Mbps.
But they won't do it
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Big difference between the periodic congestion-based bandwidth caps I suggested and the arbitrary data amount caps the industry uses.
The former helps achieve maximum use of the network while still maintaining usability, the latter is just gouging.
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Average use is the best metric for how much of the resource is being used, and bandwidth caps are a convenient proxy for that. They rel
Re:Obvious article is obvious? (Score:4, Interesting)
Surprising? (Score:4, Informative)
I doubt anyone here is really surprised by this. On the one hand, the arguments made by the ISPs make some sense: as more and more people go online and download more and more multimedia and apps alongside simple web browsing (which also uses more data than it used to), then of course bandwidth usage is also going to go up. However, that argument ignores the other side of the coin--namely that the technology the ISPs use continues to improve, becoming more and more capable of meeting (or exceeding) that demand. The caps also ignore usage patterns, peak hours, etc.
If the ISPs cut you off entirely when you exceed your cap, then their argument might have some weight. But they don't do that. They let you keep going, at the same speed you were before. Only they charge you extra money.
What borders on criminal is that they're so bad about informing you of when you approach the cap. Though she claims never to use the Internet on her phone, my mother always goes over cap. She has only twice received a notification from AT&T that she was approaching the cap--both of which came two days(!) after she had already gone over her allotted amount.
I'm still on a grandfathered unlimited AT&T account. I come nowhere near 3GB of usage each month (I'm almost always on WiFi), but I have no intention of dropping down to a cheaper account. It's maddening that I can't get tethering (officially...) without going to one of their crap capped plans.
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I'm still on a grandfathered unlimited AT&T account. I come nowhere near 3GB of usage each month (I'm almost always on WiFi), but I have no intention of dropping down to a cheaper account. It's maddening that I can't get tethering (officially...) without going to one of their crap capped plans.
Exactly the reason I'm still on Verizon's unlimited. Although I try to use the mobile data as much as possible, and with 3rd party tethering apps. Hopefully something changes before my next contract so I don't have to shell out full price for a phone though...
Verizon notifies (Score:2)
For my kid I automatically get texts for (IIRC) 50%, 75%, 90% and limit hit (she can't go over).
Re:Surprising? (Score:4)
Not that AT&T aren't thieves... but your mother probably just isn't paying attention. I have AT&T, and they send me a text when I pass 50% of my cap. They send another when I pass 90%. I've gotten the 50% one several times. I've only gotten the 90% one twice, since I don't usually use anywhere near my cap, but each time I got it, I hadn't passed the cap yet. (Actually, the warnings got kind of annoying for a while, when I was using just over 50% of my cap each month.)
One of the times, I was only a day from the end of the billing cycle, so I didn't have to do anything about it. The second time, I was on vacation and using Internet on the phone a lot, so I logged into AT&T's site and switched to the next higher plan, and noted when the billing cycle would reset my usage. The day after my usage reset, I logged into AT&T and switched back to my normal plan. Bumping up the plan a tier was less than the overage charge would have been... and for extra fun, AT&T pro-rates, so I only got charged for about five days at the higher rate... which bumped my bill up maybe $2.
This surprises who? (Score:2)
Of course they are. Just like the telco's and long distance charges. The lines where long paid for but they just keep say that to many people are making LD calls so to help increase the number we need more money. All the while they don't actually increase capacity and just pocket the money.
How we solve this I don't know. The only thing I can think of is to move to the ISP's that aren't gouging as much as the next guy. I know that's hard. I also live in a small town and have very limited choices of ISP
Nothing new here (Score:5, Insightful)
This is the exact behaviour you'd expect from a largely-monopoly or entrenched oligopoly market.
Governments or municipalities should own the infrastructure. Everything should be fiber. Most of the costs in those rollouts are administrative, not technical in nature.
There is a huge economic cost in not having gigabit FTTH infrastructure; it's big enough that companies like Google are stepping in.
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Yep, I agree. But I don't like the idea of the government owning the infrastructure unless it's needed. I do live in Canada, so crown corporations(government run businesses that fill niches where private industry refuse to run--or are run because they screwed over the public so badly that their licenses have been revoked to operate in that area) are a way of life up here. The biggest problem I have with the government owning the infrastructure is I don't trust the government not to abuse it. Unless an i
First Rule (Score:2)
Dividends of ISP's should be heavily taxed (Score:2)
From TFA:
"The best way to resolve chronic network congestion in the long term is to invest and expand capacity. Yet, a review of the publicly available financial document for some of the largest ISPs in the country shows a decline in capital expenditures—the costs associated with building, upgrading and maintaining a network, such as construction, repairs, and equipment purchases—for their wireline networks.Many ISPs are spending less money on capital expenditures now, both as a ratio to revenu
Why is data paid both ways? (Score:2)
This may seem like a really stupid question but it has always bugged me: why do both me and the content provider pay for data?
Back in the bad old days of Long Distance Calling, whomever initiated the phone call (assuming you're not calling collect or on a 800 number) paid for the call. It made sense: why pay for something that you didn't start?
However, in data, both sides pay. Am I the only one confused by this? I understand that I should have to pay for a connection (like the phone company) but why do I
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Because you will pay for it anyhow.
If you don't, you will be teased at school/work for being wise with your money.
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because the ability to service the traffic is required on both sides, and since staff, fiber, electricity, and "call-a me Bob" in support are not free, you got to pay for it.
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Because you're not really paying for data, you're paying for network access. It's more like local calling, where both sender and receiver pay a flat charge to get access to the network. Since the local network is owned by the telco, they don't have to pay anyone for usage, so you get to use it as much as you want once you have access.
With ISPs it's similar. They have to pay for what exits their network and goes to the internet, but that's pretty much a flat cost. That link should stay saturated. If yo
Without caps, you can DOS other customers (Score:2)
They have to pay for what exits their network and goes to the internet, but that's pretty much a flat cost. That link should stay saturated.
Caps exist to keep a single customer from being a disproportionate cause of that saturation, which reduces other customers' quality of service.
Burst billing (Score:3)
Please, the easiest way to keep one person from using too much throughput is to put a hard cap on the max throughput and sell it as such.
A monthly cap is a cap on average throughput over a period of one month. Divide the cap in gigabytes per month by 324 to get the effective cap in megabits per second. For example, a 250 GB per month cap is the same as a 250 / 324 = 0.772 Mbps cap on sustained throughput. You appear to be arguing against the concept of advertising a burst rate [wikipedia.org].
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Right. So with a 250GB cap you are locked into a plan that, at best, is worth the cost of 1Mbps service. Mind you, that cap is deducted from for all upstream traffic as well so it's actually half that.
No, I'm not.
My local ISP, Comcast, advertises 24Mbps service. That's a solid 3MB/s, and it actually sustains it for an extended durat
Capitalism (Score:5, Insightful)
This is precisely why capitalism doesn't belong in some markets. Cue rabid "the free market is always right" retorts in 5...4...3... but the truth is when you have any infrastructure service; sewer, electricity, communications, roads, etc., that everyone needs access to (or at least a majority of people in the community use often), without regulation this kind of thing will happen. It creates a natural monopoly; And no, the government doesn't create the monopoly. It would happen whether the government even existed or not. This is the quintessential example of where and when government regulation is needed to rebalance things so that the service provided retains its usefulness to society without becoming parasitic. The government is the only thing besides an even larger monopoly power that can influence this kind of market dynamic.
And yet here we are, getting put over a barrel and raped because of our idealized notion of how the market will "correct itself", and how government regulation "hurts businesses". You know what, fine: Let one company's profits suffer a little for the greater good, rather than letting everyone suffer a little so the company can be massively profitable at our expense. We need to put a stop to the nickle and dime death march that is killing our middle class off. We need regulation.
Re:Capitalism (Score:4, Informative)
1) Creating barriers to entry on behalf of corporate lobbyists that make competition illegal (as only government can do) except for the existing major players who coincidentally* are the only entities with the infrastructure to meet the arbitrary legal (government) requirements.
2) Looking the other way while corporations bribe government agents to allow criminal acts including intimidation and violence to prevent competition in an extrajudicial way.
Telecom is not a free market because even if I bought a ton of equipment and hired a bunch of people, I could not enter the market as an ISP, because the market is regulated. These regulations make competition illegal for any entity other than the players that "helped" draft the regulations in the first place.
*Sarcasm
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1) Creating barriers to entry on behalf of corporate lobbyists that make competition illegal (as only government can do) except for the existing major players who coincidentally* are the only entities with the infrastructure to meet the arbitrary legal (government) requirements.
Microsoft. There are no legal requirements about the creation of an Operating System.
2) Looking the other way while corporations bribe government agents to allow criminal acts including intimidation and violence to prevent competition in an extrajudicial way.
There's no evidence Microsoft has hired the mafia to break the knees of people who use Linux.
That said, the example I just provided isn't a fair comparison to the natural monopolies regarding land use; specifically easements for access to private property (electricity, gas, sewer, communications, etc.) The government has to regulate access somehow. Unfortunately, our patchwork of municipal, county, state, and federal, plus
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MS did not have the power to prevent substantial competition, especially in less consumer-oriented markets. While never popular on the desktop, Linux has long been a major competitor for ser
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Somalia is also category 2 (insofar as it applies at all, I can't really think of any Somalian 'monopolies' and as such I wonder if you know what we're even talking about here), and isn't so much 'lack of government' as it is so frequently portrayed in the West (partly out of ignorance, partly out of a political agenda), as it is that Somalians hate being de facto ruled by Ethiopians and Kenyans. However ever
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You are kinda right. When a monopoly or other form of heavily restricted competition and/or there is a public good that goes beyond a strict consumer/supplier relationship, then you are right in that we should not be left to the mercy of the suppliers. Where I think you are wrong is that this does not spell out "capitalism doesn't belong". You even say so later in your post that "We need regulation". So, capitalism DOES belong, but it should be regulated to ensure it conforms with the broader public good.
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If you're going to pick an example of the failure of free market capitalism and call for regulation, maybe you should choose an industry other than the one that has an entire agency of the federal government dedicated to regulating it.
One of the FCC's main goals is to promote competition. Instead, look at the concentration of power of radio, television, telephony, and increasingly the web, in the hands of a few powerful corporations. If "deregulation" looks like a $350 Million dollar FCC budget with 2000 em
Duh (Score:5, Insightful)
Bandwith is not a commodity like water. We don't save anything when we under utilize it. The cheapest per bit cost is when the network is maximally utilized. Incentives that encourage people to use less bandwith are economically unsound.
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No... As someone who works for a small ISP, and runs the backbone among other things, bandwidth is exactly a commodity like water. Bandwidth is extremely cheap at the source, but the source is not where the end users of that water are. The bandwidth must be distributed across a vast area to many, many endpoints. I can get water out of a river for (nearly) free. But as an ISP, if you want that "water" delivered to your doorstep and I have to pipe it uphill, 50miles from the source, the water is no longer "fr
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But as an ISP, if you want that "water" delivered to your doorstep and I have to pipe it uphill, 50miles from the source, the water is no longer "free". It costs real money to distribute...
Not really. Sure, building and maintaing the *capacity* costs money. But that's a fixed cost regardless of how much of that capacity you actually use. That's very different from water.
To earn interest on the upgrade cost (Score:2)
Sure, building and maintaing the *capacity* costs money. But that's a fixed cost regardless of how much of that capacity you actually use.
If subscribers use more capacity, the provider has to spend capital to add more capacity. Incentives to reduce use of capacity allow the provider to delay such an upgrade from one date to a later date. In opportunity cost terms, the provider earns interest on the cost of an upgrade between those dates by adding a cap.
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Incentives to reduce use of capacity allow the provider to delay such an upgrade from one date to a later date
That's exactly the problem with caps. Everyone gets worse service because the ISP refuses to build out capacity when they can just get paid extra for overages instead.
Re:Duh (Score:4, Insightful)
Bandwith is not a commodity like water.
Bandwidth is not like water, it is like water pipes.
. The cheapest per bit cost is when the network is maximally utilized.
Q: And what exactly happens if it is maximally utilized and you want to send 1 more packet?
A: It doesn't go through.
Incentives that encourage people to use less bandwith are economically unsound.
Nonsense. Another equivalent for bandwidth is the road network. Sure, perpetual gridlock maximizes the 'cars per unit of pavement' metric, and in some twisted logic divides the cost of the pavement between the most vehicles... hurrah!... but only a complete idiot would argue that encouraging people to drive less is economically unsound because it means the roads aren't getting "maximally utilized".
Saturated networks are not optimal.
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Q: And what exactly happens if it is maximally utilized and you want to send 1 more packet?
A: It doesn't go through.
Or rather, it doesn't go through with an equal probability that other packets won't go through. We all get our fair share of the network, regardless of oversubscription.
Sure, perpetual gridlock maximizes the 'cars per unit of pavement' metric, and in some twisted logic divides the cost of the pavement between the most vehicles... hurrah!... but only a complete idiot
Only a complete idiot would
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Or rather, it doesn't go through with an equal probability that other packets won't go through. We all get our fair share of the network, regardless of oversubscription.
Semantics. If the network is full, trying to cram more packets into it doesn't work. It doesn't really matter for the argument ~which~ packets don't get through.
Only a complete idiot would compare IP networks to the roads. Packets don't slow down when there's not enough room. The cost of fuel per packet is negligible, not so with cars. It's
To discourage one subscriber from hurting others (Score:3)
Or rather, it doesn't go through with an equal probability that other packets won't go through.
Caps allow the provider to discourage one subscriber from reducing the probability that other subscribers' packets don't go through.
We all get our fair share of the network, regardless of oversubscription.
Caps allow the provider to discourage one subscriber from reducing other subscribers' fair shares below an acceptable share.
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So how many times did you post this in the thread?
My goal is to discourage people from making a distinction without a difference [wikipedia.org]. I'm trying to show that no matter how many different ways Hatta rephrases the anti-cap argument, there's a corresponding phrasing for the pro-cap argument.
Do you normally defend poor business practices or something?
It's called devil's advocacy. I'm not trying to claim that caps ought to exist in a perfect world. I'm just trying to express the rationale for using them as a tool to improve the experience of the majority of customers until a capacity upgrade can be completed.
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If Bandwidth is like water pipes, what would the physical wires/cables be like?
Bandwidth is a capacity function of the underlying infrastructure. It is not the data itself. In other words it is not a measurement of "water" it is the measurement of what the "water pipes" will carry.
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Also, the big problem is that most home users want high speed, but don't want to pay for a dedicated line that guarantees that speed. I want to be able to download at 25 mbps, because my pages load faster, and I don't have to wait long for
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People want high speeds, but you don't want them going at full speed for the entire month, or they will over-utilize your network. Can you propose a better billing solution then billing them by throughput?
There's no such thing as "over-utilization". There's maximum utilization, and under-utilization. TCP/IP has mechanisms to handle the case where too many people want to use a link. If 10 people each want to saturate your outbound connection, they'll each get 1/10th of the available bandwidth. That soun
When 1/10 is too low (Score:2)
TCP/IP has mechanisms to handle the case where too many people want to use a link. If 10 people each want to saturate your outbound connection, they'll each get 1/10th of the available bandwidth. That sounds fair to me.
Caps exist to discourage a subscriber from bringing other subscribers' effective data rates below the last-mile burst rate that the provider advertises. If the provider advertises a burst rate of 6 Mbps down and 1.5 Mbps up, subscribers are going to get frustrated if they can't send at 1.5 Mbps because so many other subscribers are sending at 0.5 Mbps that the network has become maximally utilized. In this way, maximal utilization leads to embarrassing speed test results on dslreports for the provider.
and now for something inconveniently different... (Score:3)
over on the ISP and backbone side of life, data traffic is growing 50-60 percent per year, and it's a wild race to try and keep ahead. an expensive race. at this point, at least one company I'm familiar with is asking do they raise the backbones to 400 gig or to one terabit inside the centers.
that ain't the flower fund they have to raid for it.
argue caps all you want, NostrilDrippus Predicts! (tm) that tiers of usage or per-gig usage charges are your next fightin' words in mere years of time.
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An easy solution? (Score:2)
Now the problem with this is that ISP's install
Yep, yep, yep (Score:2)
As another point: I live out in the middle of nowhere, and according the the major telco/cable companies it's "not profitable" to provide any decent service to me. Yet, not 1 but *3* local ISP's have started up here--the newest one is close to 2 years old, the others have been around for substantially longer than that and are still in service, therefore presumably making money.
Qwest or Comcast could easily have owned the entire market here and left no room at all for these upstarts, but they just did not c
Do people really care? (Score:4, Interesting)
I live in Toronto, Canada and there's two options for cable and cell phone: 1) get gouged. 2) don't get gouged but deal with a smaller player.
I have friends who complain about their overage bills using the internet with Rogers and Bell. I tell them that they can get unlimited usage (or 300 gb / month limits if you want to save a few more dollars/month) for half of than what they're paying via Teksavvy and they don't want to switch.
I have friends who complain about paying $70 / month for a cell phone that only gives them 1 gig of data use and tell them about the unlimited data/calling/texting/voicemail plans Wind offers for $40 / month and am met with "wow, that's a good deal, I should switch," but no one ever actually switches.
I understand that some friends say this just to be polite so I'll leave them alone, but there is something to be said for momentum that people have with a company even if it's ripping them off.
And the crack team at the FCC... (Score:2)
Obvious (Score:2)
Data caps are a cash cow for ISPs but ISPs in general are obscenely profitable, they make energy companies look like chumps.
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http://www.mysimplemobile.com/ [mysimplemobile.com]
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Waiting until I get home is free. Have some patience.
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Waiting until I get home is free.
Even if it is free, I can think of cases where it is unacceptable. Without a cell phone, for example, how are you going to get help if you're stranded somewhere? Pay phone operators have been removing pay phones from public places because so many other people have cell phones that maintaining the pay phones has become unprofitable.
Re:Well, duh... (Score:4, Insightful)
The market isn't free because the incumbents buy laws to keep status quo.
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Then why would they vote for a center right party?
It's one or the other you dolt.
Re:Corporation makes profit (Score:4, Insightful)
What upsets most people (in the western free mark world) isn't that they make a profit. It's that the companies don't reinvest some of that profit in actually increasing capacity. They (the companies) just complain about to much traffic and crank on the rates again. That and there is a complete lack of competition and almost zero ability for a new entry in the market. This makes it at best an oligopoly and at worst a monopoly in 99% of the towns and cities.
Also why do republican morons always think that the democrats/liberals are against profit?
Oh look its the big scary socialists again. They don't want anybody to own anything! See they want corporations and millionaires to pay TAXES!!!!
AC is a moron
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While I haven't looked into this seriously, I'm starting to wonder if there is a general ISP bash going on. I understand that some of their policies are seedy, however I'm thinking about the cost.
While I agree that there may be some of that going on...
They invested huge amounts to create the infrastructure they currently have, and it could be that it is only paying off now? Or it could be that it started off as this, with companies attempting to recoup the costs and start making profit, but then found that they could continue the status quo and make large amounts of money?
Not likely. The capital costs for the infrastructure were paid for during the upgrades, and pretty much written off shortly thereafter. It doesn't take long for that to be accounted for in their accounting systems. So the operating costs are not nearly that bad, and certainly are not significantly high all the time.
This also doesn't take into account that they are selling customers different speeds over the same network. Straight-line networks (like