bronyaur1: It's almost as if cable companies were for-profit enterprises?

And exploiting what is basically a monopoly over the last mile....

How many people have a choice between either a specific cable company and a specific phone company to get last mile service?
How many people have a choice between two competing cable companies? Are their neighborhoods served by two or more cable companies using different lines?
How many people have a choice between two competing phone companies? Are their neighborhoods served by two or more phone companies using different lines?

Sadly, I don't know the answer to these questions. In the places I have lived for the past 20 years it's always been one cable company and one phone company and that's your choice, except for a small duration in which phone companies were required to make their last mile service available to other phone services.

The goal of any company is to extract the most money possible from the people they serve. Who else is most willing to shell out money for internet than the very people who use it the most? How do they identify those people?

This is pretty "duh" as far as economics goes.

And?

"Instead, what we most often see are low caps and high overages layered on top of already high existing flat rate pricing, raising rates for all users. Does raising rates on a product that already sees 90% profit margins sound like 'fairness' to you?"

So, isn't this where the free market steps in with its invisible hand to lower prices? If margins are so high, why don't investors jump into the market with new start-ups that undercut Time Warner until the price reaches a fair level that allows everyone involved to just make what they are worth?

slayer199: 5GB a month?  I'd go through that in a couple days...easily.

No shiat, I might pull that down on my phone.

uhh.. no shiat?

Tommy Moo: "Instead, what we most often see are low caps and high overages layered on top of already high existing flat rate pricing, raising rates for all users. Does raising rates on a product that already sees 90% profit margins sound like 'fairness' to you?"

So, isn't this where the free market steps in with its invisible hand to lower prices? If margins are so high, why don't investors jump into the market with new start-ups that undercut Time Warner until the price reaches a fair level that allows everyone involved to just make what they are worth?

Ha, you think cable companies work in a free market?

My surprise?
Wait here, I'll go get it....

SilentStrider: This is my shocked face.

You're not the only one recoiling in surprise. Look at this panel of judges who are just as shocked as you or I on this breaking news story:

T-Servo: Tommy Moo: "Instead, what we most often see are low caps and high overages layered on top of already high existing flat rate pricing, raising rates for all users. Does raising rates on a product that already sees 90% profit margins sound like 'fairness' to you?"

So, isn't this where the free market steps in with its invisible hand to lower prices? If margins are so high, why don't investors jump into the market with new start-ups that undercut Time Warner until the price reaches a fair level that allows everyone involved to just make what they are worth?

Ha, you think cable companies work in a free market?

Explain. Let's start one. You and me. What is physically preventing us from starting an ISP? Granted it has a high barrier to startup. It would probably take hundreds of millions in venture capital funds, but some team of VC investors will pony up any amount if it is guaranteed to return 15%/year for the first ten years.

Tommy Moo: T-Servo: Tommy Moo: "Instead, what we most often see are low caps and high overages layered on top of already high existing flat rate pricing, raising rates for all users. Does raising rates on a product that already sees 90% profit margins sound like 'fairness' to you?"

So, isn't this where the free market steps in with its invisible hand to lower prices? If margins are so high, why don't investors jump into the market with new start-ups that undercut Time Warner until the price reaches a fair level that allows everyone involved to just make what they are worth?

Ha, you think cable companies work in a free market?

Explain. Let's start one. You and me. What is physically preventing us from starting an ISP? Granted it has a high barrier to startup. It would probably take hundreds of millions in venture capital funds, but some team of VC investors will pony up any amount if it is guaranteed to return 15%/year for the first ten years.

We're not talking about ISPs. We're talking about cable companies, which have government-granted monopolies. You literally cannot start a new cable company. Therefore, they don't operate in a free market, because the government protects them. That's the problem.

If you want to start an ISP, you're going to have to lease backbone Internet -- probably from the cable company. (Perhaps you see the problem.)

Karac: Dokushin: Tommy Moo: T-Servo: Tommy Moo: "Instead, what we most often see are low caps and high overages layered on top of already high existing flat rate pricing, raising rates for all users. Does raising rates on a product that already sees 90% profit margins sound like 'fairness' to you?"

So, isn't this where the free market steps in with its invisible hand to lower prices? If margins are so high, why don't investors jump into the market with new start-ups that undercut Time Warner until the price reaches a fair level that allows everyone involved to just make what they are worth?

Ha, you think cable companies work in a free market?

Explain. Let's start one. You and me. What is physically preventing us from starting an ISP? Granted it has a high barrier to startup. It would probably take hundreds of millions in venture capital funds, but some team of VC investors will pony up any amount if it is guaranteed to return 15%/year for the first ten years.

We're not talking about ISPs. We're talking about cable companies, which have government-granted monopolies. You literally cannot start a new cable company. Therefore, they don't operate in a free market, because the government protects them. That's the problem.

If you want to start an ISP, you're going to have to lease backbone Internet -- probably from the cable company. (Perhaps you see the problem.)

Actually, the articles does talk about ISP's, which are not necessarily (but usually are) cable companies. It's entirely possibly to get your internet off a DSL from the local phone company.

Depends. For example, my local government prohibits Verizon from providing DSL service within city limits due to an exclusivity agreement with TWC on internet service rights.

The startup costs to creating a new ISP would have to include line items for bribery because otherwise it's not going to happen.

My observations after reading the source Link article:

There's absolutely no nicer way to put this: Powell is a liar. This panel was more likely about synchronizing their talking points than educating the public on this industry's real business plan. The fact that this hack is now the industry's regulator bodes ill for the customers the FCC is supposed to protect.

Obviously, it's not about fairness. It's about maintaining a fictional shortage which makes it easier for them to negotiate price hikes. They need not concern themselves with the "fair" rationing of an expensive resouce with a high fixed cost, when In fact, their costs are quite low, and constantly dropping. I suspect even the 95% profit margin that came to light recently is understated. There are surely a considerable number of obscenely large entitlements which they bundle with their fixed expense figures.

In a nutshell it works like this: their network costs something to keep powered, cooled, and maintained. Add the costs of their staff who facilitate these tasks. The networks were paid for long ago and there are no more amortization costs. A large amount of those costs were paid for with public funds, which now has been siezed by the industry, which will not share it's lines with competing businesses. They did not "spend a bunch of money" so much as they pocketed a bunch of money. Over time, the original equipment is being replaced with much more compact equipment that has much higher capacity. Staff are reduced as better management methods replace pioneering ones. The result is that the network aquires more capacity at lower expense to the industry. Yet prices keep rising!

The expense of maintaining the network does not rise or fall with the load of data moving across it. In truth, that "hot tub" and "lights" is on 24/7 no matter what, and it's expense is orders of magnitude lower than the cable bill would suggest. Noone is "subsidizing" anyone else. Everyone's connections, regardless of their capacity or consumption, costs about the same small amount to keep humming. There's simply no reason to charge based on consumption. Why charge on a "consumption" basis then? Powell said himself, "consumers are familiar and comfortable with usage-based pricing". So it's because the industry wishes to. It's easier to hike prices up for something they can themselves make scarce, than it is to invest in a higher quality network and market better and faster connections. Consumers don't know any better.

The arguement about pressuring web app designers is a new one to me. However, it's invalid. Web app designers don't need to care how much bandwidth their apps generate. Their costs are completely disengaged from the costs of their consumers. It should also be said that the content consumed by their customers is none of the industry's concern. Their meddling in these affairs (VOIP, streaming video, torrents) is merely to give their own competing services an unfair advantage.

Lastly, while concern for reaching a broader market of customers seems laudable, my inner cynic says it is likely the prologue of a new effort to extract no-strings "infrastructure improvement" funds from an industry-friendly government. It's not lost on me that Michael Copps essentially says there will be no change in attitude until there is a new FCC chairman, though I don't think that's quite how he intended it to sound.

RoyBatty: bronyaur1: It's almost as if cable companies were for-profit enterprises?

And exploiting what is basically a monopoly over the last mile....

How many people have a choice between either a specific cable company and a specific phone company to get last mile service?
How many people have a choice between two competing cable companies? Are their neighborhoods served by two or more cable companies using different lines?
How many people have a choice between two competing phone companies? Are their neighborhoods served by two or more phone companies using different lines?

Sadly, I don't know the answer to these questions. In the places I have lived for the past 20 years it's always been one cable company and one phone company and that's your choice, except for a small duration in which phone companies were required to make their last mile service available to other phone services.

The house I owned in Minneapolis has a choice of 5 Internet providers (cable, dsl, and several forms of wireless). My apartment in San Diego has one choice. Guess which is cheaper and guess which service is better?

It also took Cox cable four attempts to deliver the service I asked for and two techs blamed my wireless router for poor performance even when I showed them I was directly connected into their fark'n router via a fark'n Ethernet cable. After complaining a fourth time - my service mysteriously started working again. With no explanation. As if some one discovered a configuration error and refused to admit to it.

bandwidth isn't like water or electricity.

you don't have to burn coal to generate it, or pump it. It's basically there as a side affect of the network's existence. using it at max costs essentially the same resources as not using it. The problem is the ISP have oversold their capacity past the point their infrastructure could bear. Since real level competition will probably never be in the consumer level ISP business again, I'd vote for nationalizing the home internet connectivity business. I mean, how much would it cost to run a real fiber line to the majority of houses in america? and 4G for the rural parts? I mean, didn't the fed spend 200B for a similar purpose back in the 90s?

could you imagine if almost any company could bring you google fiber-like service? for no more than line rental from the gov, at the same rate as everyone else?

for an example, remember what early dsl was like?

My current monthly Internet allocation is 75GB. My TV is also delivered by the same fibre optic cable, and I was told they allow me 300,000GB/month bandwidth for that, but no extra if it goes over.

The upshot is that your Internet usage, if it's anything other than gargantuan, is trivial to your provider.

SuperT: bandwidth isn't like water or electricity.

you don't have to burn coal to generate it, or pump it. It's basically there as a side affect of the network's existence. using it at max costs essentially the same resources as not using it. The problem is the ISP have oversold their capacity past the point their infrastructure could bear. Since real level competition will probably never be in the consumer level ISP business again, I'd vote for nationalizing the home internet connectivity business.

I think that's pretty much right, except that you forgot about all that dark fiber the monopoly telco/ISPs have. They certainly wouldn't have a shortage if they lit one of these up now and then. At present, they're probably already operating with late-generation equipment, but over-centralizing it in order to produce bottlenecks, as well as other things to mismanage the backbone so that it looks like they are overwhelmed.

"Despite the substantial decrease in the cost of operating a network and transporting data, consumers have not seen a resulting decline in the cost of service,"

Nor will you. Why would a for-profit company operating in a near-monopoly situation (sorry, DSL is not a serious competitor to cable) willingly lower its prices?

This is why cable execs are shiatting bricks about Google fiber.

KWess: My current monthly Internet allocation is 75GB. My TV is also delivered by the same fibre optic cable, and I was told they allow me 300,000GB/month bandwidth for that, but no extra if it goes over.

The upshot is that your Internet usage, if it's anything other than gargantuan, is trivial to your provider.

It's undeniably trivial as long as that traffic stays on your provider's own network, like the video services or customer-to-customer. And they're clearly equipped to differentiate the two. But it's "too hard" to do so if it threatens their overage-fee profits. ;)

arcas: "Despite the substantial decrease in the cost of operating a network and transporting data, consumers have not seen a resulting decline in the cost of service,"

Nor will you. Why would a for-profit company operating in a near-monopoly situation (sorry, DSL is not a serious competitor to cable) willingly lower its prices?

This is why cable execs are shiatting bricks about Google fiber.

Which, in turn, is why I'm surprised that those same cable execs haven't yet bribed Congress and/or state legislatures to make fiber internet illegal.

/unless they have already tried and Google out-bribed them

Austinoftx: KWess: My current monthly Internet allocation is 75GB. My TV is also delivered by the same fibre optic cable, and I was told they allow me 300,000GB/month bandwidth for that, but no extra if it goes over.

The upshot is that your Internet usage, if it's anything other than gargantuan, is trivial to your provider.

It's undeniably trivial as long as that traffic stays on your provider's own network, like the video services or customer-to-customer. And they're clearly equipped to differentiate the two. But it's "too hard" to do so if it threatens their overage-fee profits. ;)

My provider is Bell Canada. Their principal competition in my area is called Vidéotron. Wouldn't they effectively blow their competition out of the water by folding my tiny Internet use into my TV bandwidth at a nominal charge, and forget about the accounting hassles? After all, as I said to the technician 'data is data.'

Austinoftx: They did not "spend a bunch of money" so much as they pocketed a bunch of money.

Actually, they did spend a lot of money. They spent the money debt financing, and over paying for a bunch of smaller companies to build their national monstrosities.

KWess: Austinoftx: KWess: My current monthly Internet allocation is 75GB. My TV is also delivered by the same fibre optic cable, and I was told they allow me 300,000GB/month bandwidth for that, but no extra if it goes over.

The upshot is that your Internet usage, if it's anything other than gargantuan, is trivial to your provider.

It's undeniably trivial as long as that traffic stays on your provider's own network, like the video services or customer-to-customer. And they're clearly equipped to differentiate the two. But it's "too hard" to do so if it threatens their overage-fee profits. ;)

My provider is Bell Canada. Their principal competition in my area is called Vidéotron. Wouldn't they effectively blow their competition out of the water by folding my tiny Internet use into my TV bandwidth at a nominal charge, and forget about the accounting hassles? After all, as I said to the technician 'data is data.'

But why give you data for free with your TV when they can charge you for both? I think they tacitly know that pure TV service is doomed, so the industry now days is literally offering TV for ten bucks more if you're ordering Internet service. Data IS data. And data is really cheap. But how does a greedy industry keep their profits soaring when people are leaving their expensive monopoly TV and phone services for cheap monopoly data service? By jacking up the price of the data to achieve the desired profit, and lying about how much it costs. You may be dealing with a "duopoly" in your part of Canada, but it works essentially the same as a monopoly.

Recently, someone in the industry claimed that Internet service really cost more than their own books historically said, because their figures were manipulated in order to hide some "data" costs as "television" costs. He promised that they would re-manipulate the books to back up their more recent claims that data is expensive, so we should all be satisfied then, LOL.

Harry_Seldon: Austinoftx: They did not "spend a bunch of money" so much as they pocketed a bunch of money.

Actually, they did spend a lot of money. They spent the money debt financing, and over paying for a bunch of smaller companies to build their national monstrosities.

Ok, they spent a lot of money given to them by the government. I call that pocketing it because they didn't earn it.

Austinoftx: KWess: Austinoftx: KWess: My current monthly Internet allocation is 75GB. My TV is also delivered by the same fibre optic cable, and I was told they allow me 300,000GB/month bandwidth for that, but no extra if it goes over.

The upshot is that your Internet usage, if it's anything other than gargantuan, is trivial to your provider.

It's undeniably trivial as long as that traffic stays on your provider's own network, like the video services or customer-to-customer. And they're clearly equipped to differentiate the two. But it's "too hard" to do so if it threatens their overage-fee profits. ;)

My provider is Bell Canada. Their principal competition in my area is called Vidéotron. Wouldn't they effectively blow their competition out of the water by folding my tiny Internet use into my TV bandwidth at a nominal charge, and forget about the accounting hassles? After all, as I said to the technician 'data is data.'

But why give you data for free with your TV when they can charge you for both? I think they tacitly know that pure TV service is doomed, so the industry now days is literally offering TV for ten bucks more if you're ordering Internet service. Data IS data. And data is really cheap. But how does a greedy industry keep their profits soaring when people are leaving their expensive monopoly TV and phone services for cheap monopoly data service? By jacking up the price of the data to achieve the desired profit, and lying about how much it costs. You may be dealing with a "duopoly" in your part of Canada, but it works essentially the same as a monopoly.

Recently, someone in the industry claimed that Internet service really cost more than their own books historically said, because their figures were manipulated in order to hide some "data" costs as "television" costs. He promised that they would re-manipulate the books to back up their more recent claims that data is expensive, so we should all be satisfied then, LOL.

These people are worse liars than politicians.

Anyway, my thought was that there are more people willing to pay $50-100/month for TV, so that they could charge me $20 for unlimited Internet, which is still a healthy fraction of what they charge me now, and whatever they lost on that they'd more than make up for in pulling customers from the other guy. All at zero added cost to them, and simplified billing processes.

You're right though, the TV data is essentially free, it's the content you pay for.

I'm so confused...this is more information than I need reasonably to know.

dickfreckle:

 When I recently moved, I discovered that my place was so old that Cox would have to come out and rig the whole place (It's New Orleans; everything is old here, and an older Luddite had lived here for decades prior). But unlike the usual free installation, they wanted $350 because I wasn't a new customer. To this point I had never looked into DSL, but I saw that AT&T "U-verse" was only $20 a month for a year. Yes, it's slower than Cox, but only for direct downloads. Simple browsing and streaming (what I do most often) is just as quick as Cox's network, but here's the kicker...the DSL NEVER blacks out. With Cox it would happen for hours a time at least once a week. So what if it takes me a little longer to download an album. All I did was call, and they sent me the modem/router combo. Plugged it in, waited a few minutes, and booya, I was here on Fark making an ass of myself in no time. And I save about $40 a month over my last package, which was really only superior when ...

I recently moved too and went from having cable to only DSL. DSL has never blacked out for me, but the problem is I'm so far out of town, I only get 1 Mbps service (120 kb download). They won't upgrade unless they get a government grant to make it profitable either. I'm having charter dig a cable line this summer from the street to the house so I can get cable. I know I'll have issues and outages, but to have speeds 20-30 times faster for the same price? Yeah, worth it to me.

Tommy Moo: "Instead, what we most often see are low caps and high overages layered on top of already high existing flat rate pricing, raising rates for all users. Does raising rates on a product that already sees 90% profit margins sound like 'fairness' to you?"

So, isn't this where the free market steps in with its invisible hand to lower prices? If margins are so high, why don't investors jump into the market with new start-ups that undercut Time Warner until the price reaches a fair level that allows everyone involved to just make what they are worth?

What as the free market got to do with it? TW and AT&T in this area just pay off the North Carolina assembly to keep an unregulated monopoly that block others from offering any competition and that is how they like it.

Suckmaster Burstingfoam: KWess: My current monthly Internet allocation is 75GB. My TV is also delivered by the same fibre optic cable, and I was told they allow me 300,000GB/month bandwidth for that, but no extra if it goes over.

The upshot is that your Internet usage, if it's anything other than gargantuan, is trivial to your provider.

I got the same info from Dreamhost (as it applies to server space). Basically 0.1% of users gobble 99.9% of the capacity.

On servers, it's the guy running the porn site. On internet, it's probably that tard with p2p who wants to download and archive every mp3 ever made by humankind.

You do understand that this is the provider pointing fingers and diverting your rage away from them, right? They don't want to admit that their greed led to them overselling their capacity 100x.

Rent seeking by monopolists. Free market? Nope.State House corporate greased palm monkeys.

limeyfellow

What as the free market got to do with it? TW and AT&T in this area just pay off the North Carolina assembly to keep an unregulated monopoly that block others from offering any competition and that is how they like it.

I like, your neighbor, South Carolina. Rural Counties? If they can get 190Kbps from a private carrier, no publicly funded system that can achieve a speed of 191Kbps is allowed (consider your rural ass served, citizen). The cable/telcos aren't required to build out jack shiat (yeah, expand mobile and keep charging for incoming calls). In CA, ATT was fined for predatory pricing in and around municipality that was building out their own system. Plenty of examples of this shiat (nickels/dimes add up faster the harder one squeezes - cheaper than improving one's private enterprise (all one is ultimately serving).

LEC's, in particular, now that skimming the 20 billion a year through `traditional' (slipped the third party charges in by lobbying$$ - `96 telcom act) cramming and slamming on landlines is drying up, prevention of Any competition to improve substandard service and cut into low overhead profit racket, is fixed in the state legislatures with a mere pittance (cheap whores).

Rural Electric Coop, here. All money collected that exceeds amount for capital improvements/elec. purchase/maintenance - is returned to members at the end of the year (sign over checks to provide support for payment program for those members who come up short in dead of winter). Farking user owned utilities? Nonprofit and too `pink' (can't be gamed to bleed the customers).

Raharu: Say it aint so!

You mean data caps are just a cash grab?


i knew that 10 years ago because i know this Country. i also know there is alot of unused dark fiber laying in the ground too.

so much for the "free market" and "competition" and all that noise.

bronyaur1: It's almost as if cable companies were for-profit enterprises!


oh, they're for profit alright. and they love the fact that there is little/no competition so they can set their own prices and rob their 'customers'

so much for your 'free market enterprise' america.

eventually, those 'freedom' loving f*ck cable companies (and DSL folks too) are going to own the Internet. they call that 'freedom'.

JerkyMeat: And nothing good will happen & there will be no positive change, because this is America. Shiat only gets worse.


sh*t only gets worse when you allow a bunch of CEO's/boardroom f*cks own your government/Legislators.

if we had an actual representative Democracy, this crap would not happen.

arcas: "Despite the substantial decrease in the cost of operating a network and transporting data, consumers have not seen a resulting decline in the cost of service,"

Nor will you. Why would a for-profit company operating in a near-monopoly situation (sorry, DSL is not a serious competitor to cable) willingly lower its prices?

This is why cable execs are shiatting bricks about Google fiber.


i hope those bricks are nice and dry.

Karac: Personally, I'd like to see municipalities get into the ISP business.

Of course, when municipalities get into the ISP business, the cable companies start bribing politicians until they legislate away their ability to do that. So, there's that.

bandwith is free guys!!

all the data centers, and techs in the fields and equiptment all is free.. cisco is a non proft company who donates their engieneers and gear to help america, electric companys provide free electricy for the hvac, people donate their time because they love working for such a great company

yah bandwith is completely free!

Linux_Yes: dark fiber

Wallmart has all tthose tvs laying around walmart, but if i want one they make ME pay for it... thanks obama

It is not fair wallmart has all the tv's just sitting there, unused... i want one!