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Author Topic: The End of the World as We Know It (Kinda)
Seriati
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quote:
Originally posted by MattP:
Not sure if it's been pointed out yet, but Netflix was throttled across the board regardless of network load. Even at non-peak hours it wasn't possible to get Netflix at full speed unless people switched to a VPN to disguise their traffic. This wasn't a necessary throttling because the pipes were full.

I am aware of that, and it's the only decent point that anyone could make on this topic about it being an abuse.
quote:
Over the past decade, despite rhetoric from cable companies about building infrastructure, the US has been falling further behind on Internet penetration compared to the rest of the world.
You do realize your article shows that the US penetration tripled in the period covered right? And a whole bunch of countries with far less land mass increased faster. The only one that's really big is Canada, and they were already ahead of us, have a lot of population concentration and grew at a slower rate than we did.

Don't even want to start thinking about how the US trend towards cell usage and away from home phone lines and even cable lines impact this.

So, like wow. The article actually doesn't show much of anything.

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Pyrtolin
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quote:
Whether you guys believe it, or not, all of the cases have turned on an ACCEPTENCE that network management is something that is required for the benefit of the consumer.
They're private companies, not public utilities, so the only active obligation hey have is to their shareholders. In fact if they fail to do their best to extract maximum revenue at least cost from their consumers, their shareholders can easily win lawsuits against them given our current precedents. They can and certainly do pay lipservice to customer benefit, but they are actively and outrageously lying when they do so, taking advantage of the fact that the courts generally aren't well enough versed in the technology to dispute their false claims.

quote:
Then go out and sign a deal where your minimum rate is also your maximum rate. That would be a horribly inefficient model to base a system on. You'd have gross waste of resources, you'd have a massively overbuilt system and you'd have prohibitive costs associated with expanding in underserved areas.
Google and municipal ISPs have already debunked this lie that the big players are selling, to the poin that Google can profitably offer an order of magnitude more speed than any of the other ISPs sell at a comparable price and give away baseline speeds for free.
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D.W.
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quote:
The logic here is broken. They have hundreds of thousands of customers who WERE NOT GETTING WHAT they paid for, the throttling actions reduced a minority back to EXACTLY what they paid for and freed the majority from the degredation of their paid for services.
I never once heard this reported. They did NOT reduce people back to exactly what they paid for. They reduced them to what the provider felt they SHOULD use which is far far less than what they sold them.
You can use “up to” X speed. However, we don’t expect you to use more than a tiny percentage of X. So we will sell our services to Y people at X speed knowing full well that if even a quarter of them use X regularly, our system can’t handle it. They, guessed, wrong.

They gambled on being able to sell people more than what they needed with the expectation they wouldn’t ever have to provide the full extent of what they sold. In fact, they are telling us they never could provide what they sold. You obviously buy off on this as being some sort of an insurance model. There if you need it but not expected to be used to its fullest or the system fails. I do not.

quote:
You do get the bill has to be paid? What kind of consumer advocate are you? Do you know how many people would lose their internet connection due to cost if the average data needs of a consumer tripled and the consumer had to bear the full cost?
And if consumers can’t afford this new price, it opens the door for more innovation and competition. People want this. This is obvious by the already large payments we make for the service. I am skeptical that the actual cost is all that awful and that the providers can’t still be profitable but they certainly won’t be AS profitable.

quote:
It's like you think that if only Comcast were good guys they would provide this for free cause you "paid" for five times more data than your contract really buys.
Not at all. But if I subscribe to get X Mb/s (with possibly an upper ceiling in total data per month) for a set fee, I should be able to use that full amount, 100% of speed.

It makes good business sense to assume all your customers won’t approach 100% around the clock. It’s up to you as a company to research (read gamble) at how much you can oversell or how low you can set your prices. If every single customer used 100% capacity of their plan 24/7 then the operating cost is much higher than say, 1-4hrs a day, more on a weekend at a percentage of maxium with only spike demands for most. Why build the infrastructure to support 100% for everyone when it’s never going to be used that way? Fine. Logical. They just blew their predictions and/or failed to keep up with changing trends.

Adapt or get out of the way for the competition to do it right.


quote:
It's seems like you're been ungrateful when you're complaining about being limited to just what you did pay for, so everyone else can also get what they did pay for.
I do not get my “*up to Xmb/s” I get less than that. I don’t complain because I get enough to do what I want. I do not complain about being limited to what I paid for. I complain (sometimes) that I don’t get that much. I complain when someone takes my plate away at an all you can eat buffet because the “average dinner” only eats 2 plates and they didn’t budget for me to eat 4. Tell me up front I’m only paying for 2 plates and if I want to be a glutton I’ll order 2 servings. Don’t sell me 4 then change your mind when I exceeded 2.
Netflix has nothing to do with it. Comcast oversold and now wants to keep fooling its customers into thinking they can have large amounts of speed (as long as you never use it). They want us to pay for something we won’t use. If we don’t use it, they can trick us into thinking we are getting a sweet deal on the rate. The rates they charge are for a fraction of the speed they expect you to use and in fact, are capable of providing. They change the numbers on the plans to entice you then find ways to make sure they never have to provide that. If you don’t try to use the full capacity, and most of us never do, then they get away with it.

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Seriati
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quote:
Originally posted by Pyrtolin:
quote:
Whether you guys believe it, or not, all of the cases have turned on an ACCEPTENCE that network management is something that is required for the benefit of the consumer.
They're private companies, not public utilities, so the only active obligation hey have is to their shareholders.
That's a complete non-sequitor, that demonstrates you don't understand what I am talking about or the court decisions involved. It's also an erroneous statement of law. Private companies are all established by a state and have enumerable obligations to the state, and the community as enshrined in law.
quote:
In fact if they fail to do their best to extract maximum revenue at least cost from their consumers, their shareholders can easily win lawsuits against them given our current precedents.
Name the precedents then, cause you're talking nonsense. There is no easy win by shareholders here, nor do current precedents make clear what you assert. In fact the business judgment rule only virtually erases you're whole argument.

Shareholders strongest rights on changing policy are to control the election of the companies management, not to assert the claims you are talking about in court.
quote:
They can and certainly do pay lipservice to customer benefit, but they are actively and outrageously lying when they do so, taking advantage of the fact that the courts generally aren't well enough versed in the technology to dispute their false claims.
And this is why, everyone should take your claims with a large grain of salt. You've just established a level of bias that makes you incapable of understanding the actual issues at play, since you can only see them through a narrow window.
quote:
quote:
Then go out and sign a deal where your minimum rate is also your maximum rate. That would be a horribly inefficient model to base a system on. You'd have gross waste of resources, you'd have a massively overbuilt system and you'd have prohibitive costs associated with expanding in underserved areas.
Google and municipal ISPs have already debunked this lie that the big players are selling, to the poin that Google can profitably offer an order of magnitude more speed than any of the other ISPs sell at a comparable price and give away baseline speeds for free.
I assume you're talking about Google Fiber? Which is an entirely new set of lines, privately operated with better technology and completely different protocols? Hardly debunks that existing players on existing systems needed to manage their networks.
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NobleHunter
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quote:
They gambled on being able to sell people more than what they needed with the expectation they wouldn’t ever have to provide the full extent of what they sold. In fact, they are telling us they never could provide what they sold.
This is like airlines overbooking flights on the basis that a certain number will cancel or no-show. Thoguh instead of bribing customers to put up with the inconvenience of re-scheduling (I once got offered a couple hundred pounds and a hotel room to take a flight the next day instead of the one I was in line for), cable companies tried to go after the people selling tickets.
quote:
It makes good business sense to assume all your customers won’t approach 100% around the clock.
They were also counting on content providers to not be able provide corresponding upload speeds. Internet speed depends not only on the size of the pipe but also the "pumps" at both ends. The vast majority of website aren't going to pump enough to fill the pipes (it's why the industry can get away with calling 5 Mb/s high speed). It's only videos and multi-gig downloads sites that need to build/buy pumps that strain the pipes.
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D.W.
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quote:
They were also counting on content providers to not be able provide corresponding upload speeds. Internet speed depends not only on the size of the pipe but also the "pumps" at both ends. The vast majority of website aren't going to pump enough to fill the pipes (it's why the industry can get away with calling 5 Mb/s high speed). It's only videos and multi-gig downloads sites that need to build/buy pumps that strain the pipes.
Which is why they handled the whole thing wrong with Netflix.

If Netflix was using more to "power their pump" than they paid for, start charging them more. Instead they turned down the tap to LESS than was being paid for in order to punish them for daring to use up to the maximum they had paid for. All in order to protect Comcasts (non content providing) customers from from the audacity of a content provider using full capacity.

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TomDavidson
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Actually, Seriati, I'm genuinely interested: do you work for a network provider? Because you seem quite emotionally invested in this, and have a bias in favor of the providers that is generally pretty rare to encounter. I mean, you're not even arguing the usual line about common carrier status meaning "government interference;" you're actually asserting that the carriers needed to do what they're doing, which is generally a non-starter for people familiar with the situation but a position that I might understand seeing if it were coming from a cable employee.
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Seriati
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quote:
Originally posted by D.W.:
They gambled on being able to sell people more than what they needed with the expectation they wouldn’t ever have to provide the full extent of what they sold.

What do you think they "sold"? Cause what they actually sold, if they had done nothing and just gotten out of the way, would have been crawling speeds for all their customers. What they pitched was based on reasonable expectations from past usage.
quote:
In fact, they are telling us they never could provide what they sold. You obviously buy off on this as being some sort of an insurance model. There if you need it but not expected to be used to its fullest or the system fails. I do not.
They never said they couldn't provide what was sold. All these analogies stink, but I'll try another. If you buy a share in a time share, you'd expect to get one week out of 52 possible weeks, right? Now how many shares could you reasonably sell? It's not 52 for most locations, because everyone is going to want a guarantee for a certain time of year, like a loosely defined 5 months of "summer".

That works out to about 20 "shares". If you go and sell that to customers, do you sell them 1 week and only sell 20 total and let the other 32 weeks go to waste? Or do you sell them 2-4 weeks but only one guaranteed in the sweet spot? You could almost certainly sell them 3 weeks, maybe 4 (or maybe 7 over 2 years) and have virtually no problem.

Now say you do sell the 4 weeks, and for years everyone loves it, sure they generally only use their one week, but occasionally they use one or more of the other 3. Now along comes Best of Summer, Inc. that generates nuclear heat rays, making the desirable season for the house 52 weeks long, and suddenly everyone wants to use all 4 weeks, with 80/52 what happens?

There are only a handful of choices. Your fixed costs haven't changed one iota, but with the heavier usage your incremental costs have increased.

You could renege on your promise of 4 weeks and reduce everyone to, 2.6 weeks, but keep the cost the same (or even increase it to make up the difference) which leaves all the customers unhappy. This is equivalent to Comcast having done nothing (but the ratios on a data pipeline are way less favorable than this).

You could rent extra space for the 28 weeks you're suddenly short, but the money has to come from somewhere. Either you impose an increase on everyone who bought weeks after the fact, or you find a way to force Best of Summer, Inc. to pick up the costs after all they are charging a modest fee to provide the heat rays.

Or, when they bulk at it, and you know your customers won't accept higher costs or less weeks, you could build a big ass solar share and block the radiation from Best of Summer, Inc. restoring the usage of the time share back to it's initial default.

What is really OPTIMAL here? None of you seem to be trying to find an optimal solution, and it seems like this is because you believe that Comcast has too much money and was too greedy and should make it right. Notwithstanding that no business is going to operate at anything less than a profit.
quote:
And if consumers can’t afford this new price, it opens the door for more innovation and competition.
It may, though more likely it slows it, as you create a true demarcation between the haves and the have nots on the internet, with the wealthy and early adopters being permanently enshrined with better service.
quote:
quote:
It's like you think that if only Comcast were good guys they would provide this for free cause you "paid" for five times more data than your contract really buys.
Not at all. But if I subscribe to get X Mb/s (with possibly an upper ceiling in total data per month) for a set fee, I should be able to use that full amount, 100% of speed.
Except they specifically disclosed to you that you weren't guaranteed 100% of speed, and that you were buying access to a shared resource.

And you know, maybe complaining that Comcast took steps to provide all their non-Netflix using customers their promised speeds undercuts your
argument a bit.

I don't get the fixation with making them "pay" for their good faith estimates of usage, and how they blew up because of an innovator. Every business has to adapt to increased costs in some predictable manner.
quote:
I complain when someone takes my plate away at an all you can eat buffet because the “average dinner” only eats 2 plates and they didn’t budget for me to eat 4.
Buffets aren't great examples, but they should help you to understand the math. If a buffet anticipates that food costs are 20% of its revenues, while profits are 10%, and food costs suddenly double because a clever group invents a detachable stomach, something has to change or the buffet goes under.

Why shouldn't they be able to ban the detachable stomach from their restaurant, of charge users more?
quote:
Netflix has nothing to do with it.
They had everything to do with it.
quote:
Originally posted by NobleHunter:
This is like airlines overbooking flights on the basis that a certain number will cancel or no-show. Thoguh instead of bribing customers to put up with the inconvenience of re-scheduling (I once got offered a couple hundred pounds and a hotel room to take a flight the next day instead of the one I was in line for), cable companies tried to go after the people selling tickets.

I thought about this, but its not a great analogy. It's more like the airlines sold 100 tickets for 100 seat plane, and then the passengers showed up and 40% of them were so large they take up 3 seats worth of space each.

Now you're complaining because they didn't cram them in anyway (to everyone's detriment) but instead barred them completely, while telling them they need to pay for 3 seats to fly in the future. Still not perfect though cause no way to fit in the Netflix causation angle.
quote:
They were also counting on content providers to not be able provide corresponding upload speeds.
Which is a good point. And if you look at the steps Netflix tried to implement to construct work-arounds you can see they were deliberating frustrating on that point.
quote:
Originally posted by D.W.:
If Netflix was using more to "power their pump" than they paid for, start charging them more. Instead they turned down the tap to LESS than was being paid for in order to punish them for daring to use up to the maximum they had paid for. All in order to protect Comcasts (non content providing) customers from from the audacity of a content provider using full capacity.

Lol, D.W. charging Netflix more is EXACTLY what they were trying to do. They used the degradation as a negotiating tactic to do exactly what you said, make Netflix - who was not a customer - pick up the costs of flooding their network, rather than just profiting off the externality.
quote:
Originally posted by TomDavidson:
Actually, Seriati, I'm genuinely interested: do you work for a network provider?

No. Nor in or related to the industry. My concern here is as a consumer who doesn't want his bills jacked by other people's excess use. And believes the best solution is to tie the costs to the people who make them.
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TomDavidson
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quote:
And believes the best solution is to tie the costs to the people who make them.
By which you mean the consumer, right? Or would you really punish a company for complying with consumer requests for data?
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D.W.
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quote:
What is really OPTIMAL here? None of you seem to be trying to find an optimal solution, and it seems like this is because you believe that Comcast has too much money and was too greedy and should make it right. Notwithstanding that no business is going to operate at anything less than a profit.
First, you are right, I do believe that. I also believe they have a ton of slack before they ever risk not operating at a profit. After all, they are a monopoly. They don’t have to innovate beyond what will maximize their profits because there is no competition.

As for what should happen? I’m likely in the minority. I would have them charge per usage just like my water bill or electricity. Should I pay more than my parents who only check email and surf the web a little compared to me streaming video and playing online games? Yes, yes I should. I would see everyone get as large of a download speed as the infrastructure could support but pay per the mb at a fixed rate. Maybe demand really does outstrip their capacity. I think that’s still BS for most urban areas but if it is true they could have packages which offer not only a price per useage but also a transfer rate speed that they can sustain even in peak time.

As much as I don’t care for it personally, they could treat it like the phones did (still do?) and have prime time rates and off peak rates incentivizing you to delay your downloads and streaming if you can to load balance.

As for companies like Netflix, they should have to pay for their upload pipe. Again, if it went by usage (data both directions) this wouldn’t be an issue and they would pay their fair share. I have no idea what kind of deals Netflix gets on their pipelines. But if they contract for X upload speed, and the end user contracts for Y download speed, the ISP(s) should not be intentionally slowing that down below what the two end parties are paying for.

quote:
Why shouldn't they be able to ban the detachable stomach from their restaurant, of charge users more?
I think they should charge more. I think that if some other business can see those inflating costs and say, “You know what? I can do that cheaper.” They should be given the shot on a level playing field.

quote:
Lol, D.W. charging Netflix more is EXACTLY what they were trying to do. They used the degradation as a negotiating tactic to do exactly what you said, make Netflix - who was not a customer - pick up the costs of flooding their network, rather than just profiting off the externality.
Netflix is SOMEONES customer. That company should be the only company making them pay more. If Netflix paid to get the data out into web land, and I pay to get whatever I want out of web land, what I choose to go get is (or should be) no business of the ISP.

Comcast should be able to raise my rates if I and others like me use so much data as to break their model and threaten their profits. They have no right to extort the content provider unless they are also the ISP of that content provider.

Even if they are the ISP of that provider, it's not going to fly to sell them on a different rate than the next guy by saying, "well ya you PAY for X but we only expected you to use 25% of X..." The other guy? He doesn't use that much so he can still get X for the origional price. Well, not really, but that's what's on his bill. Until he tries to use it...

[ March 06, 2015, 05:21 PM: Message edited by: D.W. ]

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Seriati
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quote:
Originally posted by TomDavidson:
quote:
And believes the best solution is to tie the costs to the people who make them.
By which you mean the consumer, right? Or would you really punish a company for complying with consumer requests for data?
It's no more a "punishment" to make a company that comes up with a new data heavy product incorporate the incremental cost of that data into their pricing, than it is to force a power plant to incorporate the costs of the environmental harm's it generates into it's pricing model.

Why do you insist that Netflix should be able to externalize the costs of its innovation to people who don't use it (ie higher bills for all Comcast customers whether or not they personally use Netflix)?

This really isn't about punishing anyone, it's about rational allocation of costs. Only 2 parties here are relevant to determine the total usage, the consumer and the data provider, yet you want a third to bear the cost of that increase. It's so contra-logical and contra-economic that it's baffling to see how you could rationally prefer it.

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Seriati
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quote:
Originally posted by D.W.:
Netflix is SOMEONES customer. That company should be the only company making them pay more. If Netflix paid to get the data out into web land, and I pay to get whatever I want out of web land, what I choose to go get is (or should be) no business of the ISP.

So how far are you willing to take this. Let's say Netflix innovates tomorrow and decides to create Netflix on the GO! A brand new product that in exchange for giving a consumer a couple bucks a month, let's Netflix use that consumer's available network capacity to download movies and retransmit them wireless to anyone who wants to look at them. Do you have a problem with Netflix taking over the "excess" capacity in your system at less than it cost Comcast to generate it?

Do you acknowledge that even though you'd get paid a couple bucks to allow them to do it, if everyone in your system signed up your personal data rates would slow to a crawl and you bill from Comcast would increase by more than the payment from Netflix? This is why I'm complaining about allowing Netflix to externalize its costs of business, it really isn't in the average consumer's best interest. It's only in the best interest of consumers in a Prisoner's dilemma where the abusers get great gains so long as they are few.

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D.W.
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I wouldn't have a problem with it. Though if they paid me for it, likely there would be issues Comcast has already made me sign away saying I wouldn't do so. [Wink]

However, if they gave you bonus features by leaving their torrent feature enabled or gave you a better rate, they may get away with something like that.

I've played games that distribute their updates in this exact manner. The more people who download the update the more "seeds" they have while those people are playing, allowing subsequent players to download the update that much faster.

There is also distributed computing. I had my playstation doing "Folding At Home" http://folding.stanford.edu/
for awhile. Using both your processing power and uploading/downloading while you aren't using your hardware/connection.

I reject your conclusion though. What would happen was Comcast would have to be more honest about what they are "selling" to people. They may also have to raise their rates. (though I don't think that's profit motivated, it's more what they can get away with.)

I will pay for what I want but I want what I pay for. I had a home ISDN line installed back when 56k modems were still taking off and my ISP kept asking me the name of my business and couldn't grasp that a home user would have any desire for this product. The after work day speeds though were pretty kickbutt for the first 2 years. [Wink]

I think we both agree that underutilizers are subsidizing overutilizers. The difference is I would retain/grow the usage and charge the overutilizers more, you would handicap them to retain the status quo.

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TomDavidson
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quote:
It's no more a "punishment" to make a company that comes up with a new data heavy product incorporate the incremental cost of that data into their pricing, than it is to force a power plant to incorporate the costs of the environmental harm's it generates into it's pricing model.
Except that Internet pricing isn't "by-product." If my company lets everyone work from home and we all connect via VPN, we are billed for our bandwidth; the manufacturer of our VPN software is not somehow charged extra for enabling high usage.
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D.W.
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The muddy water is in part that Comcast wants to also be a content provider rather than JUST a bandwidth provider. So in addition to "looking out for their average Joe customer" they are also attempting to edge in on a market / stifle competition.
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Pete at Home
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I dont think that citizen access to health care should correspond perfectly to corporate access to bandwidth.
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Rafi
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Just a note. The FCC, the agency that has taken control of the Internet, required 8 years to fully resolve Janet Jackson's "wardrobe malfunction" at the Super Bowl. If they move this slowly on something as obvious and simple as that, imagine how fast they'll move on complex technology issues and innovative new services!
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philnotfil
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The argument that Comcast was merely managing its network is only valid if Netflix wasn't working well before Comcast started throttling.

As evidenced by the people who became aware of the throttling because Netflix stopped working well, this doesn't appear to be the case.

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TomDavidson
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quote:
The FCC, the agency that has taken control of the Internet...
Just a note: anyone who says this sort of thing betrays his lack of understanding on the issue.
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Rafi
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You think the FCC is not regulating the internet?
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MattP
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The FCC's most significant regulation of "The Internet" is certifying the RF characteristics of electronic devices, many of which happen to have the ability to connect to the Internet. This new rules only constrain behavior that is widely recognized as harmful, akin to "regulating" human activity by outlawing assault.
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TomDavidson
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quote:
You think the FCC is not regulating the internet?
I am very curious indeed to hear in what ways you think the FCC controls the Internet. [Smile]
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Seriati
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quote:
Originally posted by TomDavidson:
Except that Internet pricing isn't "by-product." If my company lets everyone work from home and we all connect via VPN, we are billed for our bandwidth; the manufacturer of our VPN software is not somehow charged extra for enabling high usage.

Assuming that your VPN usage was actually data abusive (not my experience with using VPN by the way), all you're claiming is that you'd be the prisoner taking the deal. So long as only so many people use abusive VPN the system holds up fine, but if everyone worked from home using abusive VPN it would collapse, and you'd be in the same place.

Stark choice of higher prices for the consumer, slower speeds or the VPN picking up part of the tab.
quote:
Originally posted by D.W.:
The difference is I would retain/grow the usage and charge the overutilizers more, you would handicap them to retain the status quo.

That's not a difference D.W. Not even Comcast was trying to maintain the "status quo." They were trying to force Netflix to pay the freight on buying more capacity. It's extrapolation and speculation to claim they were trying to extort even more.

It's also my firm belief that if they DID extort ridiculous premiums it would cause an absolute explosion in alternative providers. High premiums have never failed to attract development dollars in the history of the market place, except where you protect monopolies.
quote:
The muddy water is in part that Comcast wants to also be a content provider rather than JUST a bandwidth provider. So in addition to "looking out for their average Joe customer" they are also attempting to edge in on a market / stifle competition.
And that is where regulation should focus, though, again it would already be actionable if they were stifling content providers for competition reasons (take a good luck at the anti-trust laws).
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TomDavidson
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quote:
High premiums have never failed to attract development dollars in the history of the market place, except where you protect monopolies.
Like, say, cable monopolies?
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D.W.
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Once upon a time there was a magical land. In that land, Good King Comcast did what was best for his peasants. King Comcast saw the roads were muddy and nobody wanted to walk around the surrounding villages. As King Comcast received taxes from all the merchants in his land he decided to pay to lay down straw on the muddy roads making them more passable.

All the peasants agreed this helped and they traveled about more visiting merchants spending their money and generating more taxes for King Comcast. More additional taxes than it cost to lay down all that straw certainly.

Then a new bakery opened in one of the villages. People came from far and wide to buy from this baker. They trampled the straw very quickly requiring more and more work to be done to maintain the road. This meant that even with the taxes gained from the baker the king was spending too much on straw and road maintenance.

I know said the king! I’ll charge the baker more taxes! The tax collectors went to the baker and told them they would have to pay more. The baker told them this wasn’t fair and that everyone got to use the roads. Just because all the people using the road choose to use it going to HIS shop, shouldn’t mean he has to pay more. After all the baker, like anyone else was costing only a little bit for his foot traffic. In fact, if everyone was using the roads near this shop, wasn’t the king saving money not having to repair other roads as often?

This angered the king and he decreed that the roads near the bakery would not be kept up any longer. The area got muddy, messy and impassable and fewer people went to the bakery until almost nobody showed up at all. The baker went before the king. He apologized and agreed to pay more taxes to keep the road more passable. The king smiled, nodded and his workers went back out to repair the road and all was well.

The End

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ScottF
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I'd be pissed if I owned the shop two doors down from the baker's store and it took my customers twice as long to get past the line to my goods. Just sayin'.
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Seriati
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quote:
Originally posted by D.W.:
More additional taxes than it cost to lay down all that straw certainly.

Then a new bakery opened in one of the villages.

This meant that even with the taxes gained from the baker the king was spending too much on straw and road maintenance.

This is your own story. Right here you've stated the problem. The upkeep is more than income generated by the system.

So is it your solution that everyone's taxes go up to pay for the Baker's profits? His competition on other streets have to increase their prices to pay the new taxes? People who have gluten allegories and can't use the baker have to pay to subsidize him?

It seems to be that you want the King to be required to provide more straw at a loss, but that only works till the royal treasury is bare.
quote:
I know said the king! I’ll charge the baker more taxes! The tax collectors went to the baker and told them they would have to pay more.

So explain, why its irrational to have the Baker, who clearly is the one profiting by the extra foot traffic to pick up the cost of providing the extra straw on his street?

Why shouldn't the King simply provide a standard ration of straw to every street and let the merchants on the street who want more straw, or even heaven forbid to pave their street do so?

In the balance of equities, you have not once, explained a rational reason why consumers should bear a cost to protect the merchant's profits. Like it or not both the King and the Merchant are going to pass through additional costs, the Merchant can directly tie them to those who are using the roads more than before, the King can only force those who are not to subsidize those who are.

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TomDavidson
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Hey, look, Seriati just privatized roads! No doubt similar logic can be applied to police, fire, and utilities, and indeed any common good, service, or resource.
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D.W.
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quote:
Why shouldn't the King simply provide a standard ration of straw to every street and let the merchants on the street who want more straw, or even heaven forbid to pave their street do so?
Right here you nail it.
Is the king providing X bags of straw per tithing subject, to be placed where needed or does he provide as much straw as is needed in front of the businesses his subjects visit?
If, as in my story the king got a cut of the bakery’s profits, then it makes sense to make sure that percentage is sufficient to cover the cost of the roads connecting to that bakery.

What if we change the story to the current Comcast business model though? Everyone who uses the roads pays a flat tax rate, where they walk shouldn’t matter. The tax rate is set based upon the average amount the King’s scribes suggest people will walk in a given day. Some walk more, some less but it all works out. The straw wagon just goes where the people are most often. The king doesn’t care what merchants benefit now because he is getting taxes no matter what.

Now that there are dry roads, some tinkerer invents a bicycle. Suddenly many people are out on the roads FAR more often both to run their errands and for exercise or entertainment. They can go further and faster. (This is Netflix offering a new service which increases usage overall) For this to work however the roads have to be kept very dry and in good condition. That means that more straw IS in fact required now if enough people start using bicycles.

Does the king raise the tax rate of all of his subjects? Just those who bought bicycles? The tinkerer who is selling the bicycles?

We focus on Netflix because we are treating it as a bakery; all roads leading to it. It is the source of the congestion. The way the internet works however means that other than sizing the front door properly for the bakery (outbound data pipe line of Netflix) the issue isn’t the destination. They should have to pay for that outbound data pipeline and do so already. The issue is that any of Comcast clients can go to that bakery with their share of the straw and that’s what they want to do. That the king has to lay down the bulk of his straw in this one place doesn’t matter. The issue is now they have a reason to leave the house. That reason is throwing off his scribe’s estimate on the “average” amount of walking in a day. Where they go doesn’t matter, that there is an ever increasing amount of “above average” walkers is the problem.

Even if they squeeze Netflix, competitors will appear as Netflix passes on those costs. Internet usage will only go up. If we CAN stream larger amounts of data, we WILL do so.


Maybe ISP’s should go to the tax the merchant method and make peasant road use subsidized. You can kiss private web pages goodbye as well as any not for profit sites.

[ March 10, 2015, 01:12 PM: Message edited by: D.W. ]

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Mynnion
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I started thinking about the way cable works. Comcast collects a payment from the customer and PAYS the content creator in hopes of attracting or keeping more customers. They run new cable or fiber optics to upgrade the delivery services. I now buy internet services from them on a tiered system depending on the speed I desire. They then request payment from the content provider.

At the same time cable subscriptions are flagging so Comcast is looking to increase the cost to their direct competition. I am surprised this did not raise anti-trust flags.

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Pyrtolin
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quote:
Does the king raise the tax rate of all of his subjects? Just those who bought bicycles? The tinkerer who is selling the bicycles?
Does he even need to raise rates, since people on bicycles are already effectively paying for a higher rate plan, both through taxes on the bicycle purchase/profits and on any additional profits made because they can do more business in a day.

Sure there's a call for investment in more roads and straw, but that's what the king is supposed to be doing with the money in the first place. But instead, the king realizes that he can throw tacks on the road, which slows down the bicycle riders (as well as the people walking) and then demand that businesses pay him a little more to clean up the tacks, which is much cheaper and far more profitable to him in the short term than investing in better roads.

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D.W.
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The king just wants more taxes. He is going after whoever he thinks is least likely to flinch when he puts on the squeeze. It can work if you are a dictator until the people rise up against you.

As a business model it's pretty crappy and should lead to competitors moving in on your turf. If there was a level playing field for them to do so.

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Pyrtolin
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quote:
Originally posted by Mynnion:

At the same time cable subscriptions are flagging so Comcast is looking to increase the cost to their direct competition. I am surprised this did not raise anti-trust flags.

It would have, except that legal exemptions from most antitrust laws were explicitly created when cable was a new technology. They we're (correctly, at the time) able to argue that their new, experimental business model would only be viable with a critical mass of customers and without having to fight other companies for limited physical capacity for wires and distribution stations.

Now that the technology is very well proven, and the infrastructure is not only entrenched, but upgraded to modern standards sot that it's effectively equivalent to the fiber connections that Verizon, Google, and other ISPs are using, it's taking advantage of the profits it makes from that protection to not only protect those exemptions, but to squelch competition and to create artificial scarcity so it can demand higher prices and act in other consumer adverse ways that increase its profit margin, including picking popular services and arbitrarily restricting them be able to double-charge for capacity instead of investing in more capacity.

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Seriati
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quote:
Originally posted by D.W.:
quote:
Why shouldn't the King simply provide a standard ration of straw to every street and let the merchants on the street who want more straw, or even heaven forbid to pave their street do so?
Right here you nail it.
Is the king providing X bags of straw per tithing subject, to be placed where needed or does he provide as much straw as is needed in front of the businesses his subjects visit?

No. Actually, the king has being treating all roads (not subjects or businesses) equally, since, on any given day, his subjects previously used them equally. In fact, they each went to one of seven destinations once a week.

The Baker though has made it so that they each still goto the other six destinations once a week, but to the Baker every day, sometimes 2 or 3 times in the same day.

Without a lot more straw either the roads to the Baker becomes impassable and the rest stay great or they all become very bad but still slightly passable.
quote:
What if we change the story to the current Comcast business model though?
Good luck, you guys keep leaving out fundamental elements when you try.
quote:
Everyone who uses the roads pays a flat tax rate, where they walk shouldn’t matter.
Agreed WHERE doesn't matter, HOW MUCH though is critical. Going from a total of 7 trips a week, to on average 15 or 16, or even more.
quote:
Now that there are dry roads, some tinkerer invents a bicycle.
No, this isn't any better than the Baker model you already had. It's adds nothing new, and actual detracts in a number of places.
quote:
We focus on Netflix because we are treating it as a bakery; all roads leading to it. It is the source of the congestion.
Again no. It's not because all roads lead there. It's because the internet is a connection for two side transactions in a way that simple roads are not, if you imagined that the only way a road could be used is if you went directly to a specific destination and back it would be closer (and yes, I know that's not how routing actually works).

You literally can not have the extra trips on the roads without the better baker. The old baker couldn't make enough goods to sell at that rate, and even if he could he only sold loafs of bread and not the dozen of ready to eat products the new baker sells for breakfast, lunch and dinner.

We all definitely want the new baker, we even want him to do well, but there is no reason he shouldn't bear the costs of damage to the roads where the trips to his store have more than doubled the total number of trips that used to occur on the road BECAUSE he's offering way more than the old baker.
quote:
The way the internet works however means that other than sizing the front door properly for the bakery (outbound data pipe line of Netflix) the issue isn’t the destination.
The door isn't the right analogy. Its the product that connects to the customer not the entrance. Which means you've ignored a critical element by stating the "issue isn't the destination." It's literally half the issue in a two sided transaction.
quote:
The issue is that any of Comcast clients can go to that bakery with their share of the straw and that’s what they want to do.
The issue is that any of them could go to the bakery seven times in a week, but then they wouldn't have the straw to get to the other 6 destinations they need to get to, not to the butcher, the dairy, the doctor's office, school, church or the King's palace to complain. And if even they obsess over the bakery and forget everything else, and start going 3 times in a day they run out of straw 3 days into the week. What happens next? Mud.

The system doesn't work without more straw.
quote:
Even if they squeeze Netflix, competitors will appear as Netflix passes on those costs.
All this model does is require both the customer and the product producer to share the cost of their connection. How they split it is still up to them. The Baker can pass the cost on, by adding ten cents to each trip for the straw costs (maybe encouraging fewer trips where they buy more (ie more download less streaming)), or maybe they add it to each product and the amount of straw grows exponentially.

Competitors don't get an advantage because they too have to deal with the costs.

This is simple efficiency analysis. Tieing the costs of a service to the users of the service maximizes efficiency.
quote:
Internet usage will only go up. If we CAN stream larger amounts of data, we WILL do so.
And if we, or the data producers pick up the tab rather than freeload, everyone will keep a high level of service.
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TomDavidson
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Don't you feel any sense of shame when describing the paid usage of a service within contractual limits as freeloading?
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D.W.
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quote:
We all definitely want the new baker, we even want him to do well, but there is no reason he shouldn't bear the costs of damage to the roads where the trips to his store have more than doubled the total number of trips that used to occur on the road BECAUSE he's offering way more than the old baker.
You seem to be under the impression that Netflix does not pay for their bandwidth.
They pay for their upload pipeline. I expect they pay Comcast but even if not, they pay SOMEONE for it. Whatever the details are, they negotiated with an ISP a fee for data amounts at a certain speed. With the expectation they told the ISP what they needed and negotiated appropriately for that price. Or, were dictated what that price would be.

The customers (content consumers) pay for a download pipeline (and some upload). The price of the packages offered to customers are based upon a usage rate well below the “up to X speed!” they are sold. Because some of these customers found a means to use that “up to” rate more often than Comcast expected does not give them license to attempt to hit up the content providers AGAIN. Or worse, hit up someone else's client, effectively double billing them in order to subsidize their users who they alegedly aren't charging enough...

One of these is true:
1: Netflix is a customer of Comcast and Comcast can renegotiate the pricing for the upload bandwidth speed and total data uploaded.
2: Netflix is not a customer of Comcast and if the overall data usage of Comcast’s network is higher than their model allows for they must alter their model.

The solution seems to be Comcast must repackage it’s offerings to more accurately reflect what it is capable of providing to an individual user or upgrade their infrastructure to meet the new demand levels.

I just don’t see how anyone can defend the idea that they can go with their hand out to Netflix or worse, hold them hostage until they pay a ransom.

It seems to be you, not me, who want more than they pay for. You don’t want the illusion of what your plan offers threatened even when they have shown us that they are unwilling to make good on their end of the agreement and are using this “crisis” as an excuse to increase profits.

If we want another analogy (come on, you know we do!) Netflix built a drive in theater. It is up to it's customers to find their way their in their car. Now the city road comission is upset at all the extra traffic going to that drive in. Well, not really upset. They are just salivating at the prospect of getting a slice of those revenues. After all, THEY control the roads. The drive in is useless if people can't get to it. Doesn't matter how nice their parking spaces are or how big the drive way and concession stand is. Enough road cones and deture signs put up on the city roads around that drive in and they can strangle business.

That the drive in already pays it's city taxes doesn't matter. The city wants more!

[ March 10, 2015, 05:00 PM: Message edited by: D.W. ]

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Pyrtolin
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quote:
The issue is that any of them could go to the bakery seven times in a week, but then they wouldn't have the straw to get to the other 6 destinations they need to get to, not to the butcher, the dairy, the doctor's office, school, church or the King's palace to complain. And if even they obsess over the bakery and forget everything else, and start going 3 times in a day they run out of straw 3 days into the week. What happens next? Mud.
And this is where you really break down. They've paid for a certain amount of bandwitdh. In this case, 7 trips a week. In the past they may have made 7 trips to 7 different places, not they're making 6 trips to one place and 1 trip somewhere else. They're still using the number of trips they paid for, either way, because their service plan prevents them from using any more than that. And the Baker is also already paying for every person that enters his shop as well.
They are willing to pay for more trips, if needed, to make sure they can get everywhere they want to go, and the price per trip is already significantly more than the cost of straw for that trip.
The problem is that the king sees all these people going to the Baker and realizes taht, because the baker is so poular, he can deliberately not allocate straw to the baker's road and then force the baker to pay extra to keep operating (while at the same time, the king, being a bit of a baker himself, makes sure that he allocates as much straw as he likes, at cost, to his own little bakery)

The king is already charging a per-trip tax that results in a profit margin an order of magnitude larger than the cost of building and maintaining the roads while he deliberately provides roads narrower than the total traffic that he has promised can travel on them so that he can then justify putting more straw on his own less used road and less on the baker's more used road on the basis of a manufactured need to discourage people from going to the baker unless the baker pays a premium to avert such sabotage.

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MattP
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Here's what one of the major Internet backbone providers had to say about Verizon throttling Netflix when they tried the same throttling that Comcast did:
quote:
Verizon has confirmed that everything between that router in their network and their subscribers is uncongested – in fact has plenty of capacity sitting there waiting to be used. Above, I confirmed exactly the same thing for the Level 3 network. So in fact, we could fix this congestion in about five minutes simply by connecting up more 10Gbps ports on those routers. Simple. Something we’ve been asking Verizon to do for many, many months, and something other providers regularly do in similar circumstances. But Verizon has refused. So Verizon, not Level 3 or Netflix, causes the congestion. Why is that? Maybe they can’t afford a new port card because they’ve run out – even though these cards are very cheap, just a few thousand dollars for each 10 Gbps card which could support 5,000 streams or more. If that’s the case, we’ll buy one for them. Maybe they can’t afford the small piece of cable between our two ports. If that’s the case, we’ll provide it. Heck, we’ll even install it.
...

All of the networks have ample capacity and congestion only occurs in a small number of locations, locations where networks interconnect with some last mile ISPs like Verizon. The cost of removing that congestion is absolutely trivial. It takes two parties to remove congestion at an interconnect point. I can confirm that Level 3 is not the party refusing to add that capacity. In fact, Level 3 has asked Verizon for a long time to add interconnection capacity and to deliver the traffic its customers are requesting from our customers, but Verizon refuses.

http://blog.level3.com/global-connectivity/verizons-accidental-mea-culpa/

Eventually Netflix had to pay up to get this artificial limitation removed.

[ March 10, 2015, 06:32 PM: Message edited by: MattP ]

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MattP
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So it seems like what the king is actually doing is going out at night and sweeping the straw off the road and then insisting the baker pay for more because the baker, in his estimation, can't afford not to.
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Mynnion
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I pay for a medium to high bandwidth. The marketing department for my provider specifically recommends its higher bandwidth plans by stating that they are better for streaming video.

Rather than use the king and the baker a better example might be a private Turnpike. I pay toll to drive a certain type of car a certain distance. If I drive a truck a greater distance I pay a higher toll. They don't charge the owners of the mall at exit 10 for the increased traffic at that exit however they may charge a premium price to the driver.

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