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  1. #16
    Lounger MRCS's Avatar
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    jbmlaw -
    "Some content providers make greater use of the limited broadband than do others."
    Is it really the providers who are making use of the capacity or the consumers? If no one subscribed to NetFlix, I don't think they would they be making much use of it at all.

    You make a good point about who should pay for expanding the roadway. Let's say I only use NetFlix a little and someone else uses it a lot. If the providers had to pay the costs, wouldn't I be subsidizing the people who use it a lot? For consumers with mobile plans, as it is now they have to pay more when they go over the data limit included in their fee.

    Even though I think we've exhausted the roadway analogy, the way it's done there is by some of the costs being borne by everyone thru the general fund and some by usage thru gasoline taxes, plus tolls if you live on the East coast. Some sort of split might be applicable, if it really went toward expanding the roadway and not just into their pockets. Either way, you'd have to introduce a lot of bureaucracy. If you're going for the least bureaucracy approach (my preference also), my opinion is let the market decide on the consumer side depending on how much they use and let the providers compete for that usage.

  2. #17
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    Dear MRCS, partially agree: "let the market decide on the consumer side depending on how much they use and let the providers compete for that usage," Don't know why the producers should get a free ride, and certainly the producers should be entitled to set their fees on a per-gB of bandwidth used also. Still not sure why the producers should be exempt from ISPs charging them for their usage, and only consumers should be so charged. Still no need for bureaucrats in this analysis so far. If ISP fees reach too far, the market will find ways around them. The cable/satellite television industry is learning that the hard way now, and I have every confidence that the market will work the same magic for the ISPs, if competition is allowed - the presence of bureaucrats makes that less certain, however.

  3. #18
    Lounger MRCS's Avatar
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    "should be entitled to set their fees on a per-gB of bandwidth used also"
    This is the one I've been wrestling with, but let me address two of your other comments first.

    "Still not sure why the producers should be exempt from ISPs charging them for their usage"
    I can't add to what I said before that it's not NetFlix, for instance, using the bandwidth, it's me consuming as much or as little of what they have made available.

    "Don't know why the producers should get a free ride"
    I guess it's because I think of it like electricity. I am paying for that, and I don't think they should throttle the portion (if they could) to my Visio TV just because I use it a lot more than some other electrical devise and Visio won't pay up. We've recently had that back East with some cable companies and baseball channels. I happen to think it's a better economic model to not have consumers held hostage to what's going on with two other parties. After all, we've had lawsuits about ISPs not providing the advertised download rates. I don't know the outcome of those lawsuits, but I do know I'm not getting what I paid for if they knowingly and purposefully decrease speed.

    Without getting too deeply into economic theory (hopefully), remember the pictures of street scenes from the 1920s with an unbelievable number of wires on the telephone poles. Those were consolidated into one line leading into the premises, just as we now have one internet, and NetFlix isn't going to run its own wire into my house. I don't see where the market will work some magic around that one. Therefore, what makes more sense, to have the producers pay for usage or the consumers, or some of both? IF I could pay the ISP for full speed from NetFlix I might feel differently about this, but I can't. So, with deference to your position, I come down on the other side.

    It could have been, as you say, that the producers set their fees on a per-GB basis, but that's not what happened. Instead, consumers are being charged on a per-Mbps basis. The joker here is innovation. Given that economically either way would have been equal, the former is more likely to foster innovation.

  4. #19
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    Innovation

    Dear MRCS, agree that innovation is the key, but believe innovation is stifled by bringing in bureaucrats at any level. The FCC's "Department of New Ideas" does not inspire.

  5. #20
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    Here in Georgia we have competition among providers for natural gas. We do not have hundreds of pipelines running up and down every road. There exists a company whose sole purpose is to maintain the pipeline - they are heavily regulated and get a consumer fee of around $15 per month - and the gas is supplied by a company we choose, and the pricing is the primary form of competition, and there is no movement to go back to the old way, where a regulated monopoly purchased the product we consumed and then sold it to us. The same potential exists for ISPs. Today, however, our internet is more like the old model of gas (and electric) companies, where a monopoly ISP blocks meaningful price competition. Suspect nobody would care about the relationship between any ISP and any content provider if consumers could move easily to different ISPs. The "net neutrality" debate is small potatoes, obscuring our real complaint with the system.

  6. #21
    Lounge VIP bobprimak's Avatar
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    Quote Originally Posted by jbmlaw View Post
    Here in Georgia we have competition among providers for natural gas. We do not have hundreds of pipelines running up and down every road. There exists a company whose sole purpose is to maintain the pipeline - they are heavily regulated and get a consumer fee of around $15 per month - and the gas is supplied by a company we choose, and the pricing is the primary form of competition, and there is no movement to go back to the old way, where a regulated monopoly purchased the product we consumed and then sold it to us. The same potential exists for ISPs. Today, however, our internet is more like the old model of gas (and electric) companies, where a monopoly ISP blocks meaningful price competition. Suspect nobody would care about the relationship between any ISP and any content provider if consumers could move easily to different ISPs. The "net neutrality" debate is small potatoes, obscuring our real complaint with the system.
    In Illinois, Natural Gas delivery deregulation gave us choices of suppliers. So far, it appears that this part of the Choice Program works OK.

    But on the electricity side, the reverse happened. It has been an unmitigated disaster. Scammers and flim-flam artists are offering teaser rates and then jacking up the rates and charging exorbitant exit fees. Trying to pick a supplier and a rate plan is like trying to do advanced Matrix Equations for which there are no determinat solutions.

    Cell carriers used to have (and some still have) similar bait and switch tactics when setting up yearly or multi-year contracts. And if the Cable Companies are any guide, ISP competition under a non-net neutral environment looks to be a consumer nightmare.

    We will ultimately end up the way the breakup of AT&T left us -- initially lots of choices and good rates, but ultimately less competition and lousy rates. Regional monopolies will again appear after only a few years, and consumers will be the real losers.

    So the experience of Georgia with Natural Gas deregulation looks to me like one rare exception to the general pattern. Any anti-competitive practice such as the new FCC Net rules is in the long run bad news for competition and consumers.
    -- Bob Primak --

  7. #22
    Lounger MRCS's Avatar
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    jbmlaw -
    "There exists a company whose sole purpose is to maintain the pipeline - they are heavily regulated and get a consumer fee of around $15 per month"
    I was wondering, if the infrastructure could be upgraded (to make it comparable to the internet, like copper wire to fiber), who decides - the maintenance company, the regulators, a consensus of the suppliers, or is it decided by a vote of the rate payers? I presume the upgrade cost is then added to maintenance company's monthly bill.

  8. #23
    Star Lounger Odos270's Avatar
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    IMHO, Net Neutrality is a major issue. Most of my news I get online. I get it from independent media. They can't compete with the big news conglomerates. Not even close. So, why should they be regulated to the backwater of the Internet? Their site should be able to load just as fast as CNN, NBC, CBS and such. Why should forums I frequent load at a snail's pace compared to those with deep pockets to pay for said "fast lane"? I'm not a big streaming video user. My ISP has a 'limit' of 350GB a month (no, they don't tell you that... you have to DIG for that info) and I've never hit said 'limit'.

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