The Evil Intent of Data Caps

[Commander Taggart]

It's all been said here before... Cable providers don't want you paying Apple or Vudu or Netflix or whomever to provide you with movies over their pipes, thus the bogus P2P claims and the clamoring for data caps.

Gizmodo has a pretty good summation:

http://gizmodo.com/5033779/giz-explains-how-broadband-usage-caps-will-kill-internet-video

[Darth Marley]

Concise points made.

The thing is, when the article says "uses your cable provider's pipes, but it doesn't see a dime from the transaction" gets it wrong. I paid at the door, bitch. They get the monthly fee for ISP services.

The Japanese had one of their major ISPs put an upload cap into effect, limiting it to 90 GB a day. Upstream only. Downstream remained unlimited.
And American ISPs are whining about 40 GB a month.

DSL looks much more attractive at a cheaper price than metered and limited cable.
I can adapt to slower speeds, with the only cap being the absolute limit of the physical network much easier than adapting to paying extra to use the ISP service the way it was sold to me.

Playing Team Fortress 2 24/7 all month uses about 63 GB in that month.
Assume a kid plays maybe 1/4 of that during a month. Then there is the VNC connection that lets you work at home, maybe uses half a GB a day. Add to that the occasional youtube, or youporn viewing, and you have exceeded the limit.

While I generally favor free markets, some "natural monopolies" like the local water service, runs as a socialized monopoly. None of the "a company bids to run the service" but an honest to God municipal workers do the maintenance, provisioning, and billing all in house.
If there were a national fiber optic system, or even a local one, then we can go back to letting the entertainment companies acting as content providers, and cut out a whole industry that benefits a few shareholders while holding the nation back compared to emerging Pac-Rim countries.

Cable operators need to understand that expanding the network to serve the customer is a higher priority than paying dividends and bonuses. The Internet is commoditized in the global market, and the USA can't let it continue to even pretend to be a high margin enterprise.

[Commander Taggart]

If there were a national fiber optic system, or even a local one, then we can go back to letting the entertainment companies acting as content providers, and cut out a whole industry that benefits a few shareholders while holding the nation back compared to emerging Pac-Rim countries.


Ah-men.

[BST]

If there were a national fiber optic system, or even a local one, then we can go back to letting the entertainment companies acting as content providers, and cut out a whole industry that benefits a few shareholders while holding the nation back compared to emerging Pac-Rim countries.




I'm not quite sure that I follow this line of thought.

As it stands now, the "industry that benefits a few shareholders" IS the same industry that is spending the money to deploy the fiber. On the telco side, both AT&T and Verizon are spending billions to run fiber in their respective footprints. Comcast has already made substantial investments, to my knowledge, for fiber "inter-connections" (to the existing coaxial cable network). Likely, Time Warner, Charter, Cablevision and others have done the same.

Oftentimes, the federal government mandates various "things to be done" but, rarely do they ever back that mandate up with the money to make it happen. The Universal Service Fund (or Universal Connectivity Charge) which can be found amongst the long distance charges of a typical phone bill is just one of those unfunded mandates. Originally, the FCC mandated that ALL long distance companies would pay into this Universal Service Fund and the monies collected would be used to subsidize the high cost of providing phone and internet services to rural areas. These fees proved to be rather onerous for most telcos, even the well-heeled. Subsequently, the phone companies were given permission to pass along the charges to the end-user.

Having a national fiber optic network would be a wonderful thing but, how would it be funded? How would it be deployed? How would the investors be rewarded for their investment?

Then, assuming it is ultimately deployed, how would repair issues be addressed and compensated?

(My thought is that if a national network were to be developed, it would fall under the jurisdiction of the federal government, much likely the interstate highway system is under the jurisdiction of the federal Department of Transportation but, similar to that system, maintenance would be at the state level. Thus, the segments of the national network passing through the territory of a particular carrier would fall under the responsibility of that carrier. (But which one -- the telco or the cable carrier? )


Lots of questions, I agree.

Hopefully, we'll have some fun formulating answers to them.

;)

[BST]

Concise points made.

The thing is, when the article says "uses your cable provider's pipes, but it doesn't see a dime from the transaction" gets it wrong. I paid at the door, bitch. They get the monthly fee for ISP services.


Agreed. We pay them, already, for the service. We should not have to pay twice.





Cable operators need to understand that expanding the network to serve the customer is a higher priority than paying dividends and bonuses. The Internet is commoditized in the global market, and the USA can't let it continue to even pretend to be a high margin enterprise.



That's a nice thought but, the mission of just about any public company, including cable companies and telcos, is to "maximize shareholder value". And yes, that really is how it should be. Whether the "shareholder" is a 80-year old widow who owns shares of AT&T stock or Calpers whose net worth (of retirement assets) was amassed through investments in various financial mechanisms available in this country, i.e., stocks, bonds, etc., we all benefit in some form or fashion when shareholder value grows. Our society and economy are all so inter-connected that we need to exercise great care before we start "pulling at loose threads" or we could damage the entire "fabric".

[Darth Marley]

In ideal free market conditions, I would agree.

Cables serve a region carved out as a municipal monopoly though. They don't have other cable companies competing against them, even though there are other Internet and television delivery pipelines.

I could make a case that Internet infrastructure is a matter of national security importance. If the Japanese can have a better fiber optic infrastructure than we, it puts the whole nation at a competitive disadvantage.
It is bad enough that they get better video games 3-5 years ahead of us!

[BST]

In ideal free market conditions, I would agree.

Cables serve a region carved out as a municipal monopoly though. They don't have other cable companies competing against them, even though there are other Internet and television delivery pipelines.

I could make a case that Internet infrastructure is a matter of national security importance. If the Japanese can have a better fiber optic infrastructure than we, it puts the whole nation at a competitive disadvantage.
It is bad enough that they get better video games 3-5 years ahead of us!


Agreed. That's why they're still regulated at the state level. During the time period following WWII, the phone network WAS a matter of national security. That's why AT&T became the regulated monopoly that it was, prior to divestiture in 1984.

Actually, the one concept that I've been waiting to see come to fruition is the idea of using the power lines to transport internet traffic. It would provide ready-made competition without much additional investment. Probably 80-90% of the infrastructure is already there.

[Darth Marley]

Using power lines is a fine thing, but it has limits. I do not suspect it has a capacity that will approach fiber optics.

And it is capacity that is the issue.

The typical US family should be able to have a massive amount of data throughput.
Not just a matter of being served video on the Internet toll road, with companies seeking to monetize every byte of traffic. But something that can serve as a information work pipeline and an entertainment pipeline simultaneously.

Want to reduce fuel emissions and consumption? Have more clerical workers telecommute.
Want video calls to become ubiquitous? Can't do that with traffic caps.

And with cable ISPs, there is a simple anti-competitive issue- VOIP.
I can pay Vonage around $20/month and have to worry about the Internet cap, or I can pay Comcast quite a bit more, and still have to worry about their deceptive cap practices.
An alleged employee comment online that if you use their "unlimited phone service" all the time, they will do the same thing, call you and say it isn't really unlimited, and that they will cut you off if you use it 24/7.

When the Internet stated, traffic was forwarded from one network to another as a courtesy.
Now, with "backbone" telecoms trying to extort "peering fees" from other companies, business is holding the Internet hostage.
It is like Enron with data instead of electricity.
I still favor a free market, even with electricity, but we have see how bad things can get when we try to have both artificial monopoly and laissez faire.

The goal of free enterprise is not to make shareholders or company owners wealthy, but to drive the price of goods and services down to their nominal cost. When things don't get cheaper constantly, the system is broken.
The cultural worship of the entrepreneur has shifted focus from the market system being at its heart a means of making new goods cheaper for everyone rather than a means to elevate a few to a financially elite position.

[BST]

The goal of free enterprise is not to make shareholders or company owners wealthy, but to drive the price of goods and services down to their nominal cost.



Agreed. But, what we were discussing earlier was the "building of the backbone" or the creation of the fiber optic network. In either scenario, the issue of compensation will need to be addressed.

Currently, the builders of the Internet backbone are being compensated for their initial construction outlays as well as maintenance of the network through the monthly fees that we pay for the service. To create a fiber optic network, that same type of compensation will need to take place.

Where the rub seems to come, now, is with the usage caps. For data and video, I don't have an explanation except that it's either short-sightedness on the part of the builder to not construct a backbone with sufficient bandwidth to accomodate usage (with an eye toward expected usage 5 or 10 years from now) or greed.

With regards to "unlimited long distance", the telcos generally define unlimited long distance as that which would be considered NORMAL for residential use. The reason is that the public switched network is used to transport the vast majority of phone usage in this country and there are access fees that are paid from one company to another when a particular call traverses another company's network on its way to completion to the other party (being called). These are per-minute fees. When unlimited service was first conceived, it was not done so with the idea that one would make a long distance call @ 12:01 AM on the first of the month and leave the phone off the hook for the entire month. (That would equate to 24/7). No, unlimited service was viewed with an eye as to what would be normal usage for the average family. Most ranges are in the 2000-3000 minute per month category.

Additionally, unlimited use for residential service was not meant to be used for folks setting up "business at home", for the same reasons. Business service, whether at home or at another site, is just that, business service and not residential. There are differences in provisioning the service, differences in capabilities, and differences in cost structures. However, you will still have folks that try to get that square peg in the round hole and feel disenfranchised if they can't.

[Darth Marley]

Agreed. But, what we were discussing earlier was the "building of the backbone" or the creation of the fiber optic network. In either scenario, the issue of compensation will need to be addressed.


The topic drifts with my whim and attention span!

The network is pretty much in place. It is the most expensive "last mile to the home" that is the obstacle.

http://en.wikipedia.org/wiki/Dark_fiber

So what about all that dark fiber that exists, but is being held out of the market like DeBeers does with diamonds? It really makes the liberal anti-capitalists look righteous when the capacity is there, and it just isn't being used because it might depress prices and profits.
And, it was built by governments at various levels granting permits, exceptions, and right-of ways that a well funded start-up competitor might not be allowed to duplicate.

The concept of PSTN in a packet switched world is outdated. It is a pricing model that is driving the practice rather than technical necessity. It really is a telecom conspiracy to continue to gouge the consumer.

Usage is usage, and distinctions between "normal residential usage" and business usage in another exercise iin corporate apologia. While "terms and restrictions" do apply, if a company advertises "24/7 always on, with speeds up to 6 Mbps" then I expect my personal limit of usage to be the limit of the ability of the network to provision my connection.
And the fun thing is, the way TCP/IP works is that when there is congestion, it slows down for everyone on the network segment. The case for network management needing pro-active usage deterrence is totally bogus.

While the bean counters want to stress bean counting, the more fundamental issue of a perception and view of customer service is what in my opinion needs to be addressed.

http://www.crn.com/security/208700525


What do security threats and Tiger Woods have in common?

No, it isn't a lame joke (although it may have started out like one.) Apparently, there is more of a correlation than you might think.

Starting Monday at about 9 a.m. and peaking at about 1:30 p.m. Pacific Time, ISPs noticed an unusual spike in Internet traffic -- some growing as sharply as 15 to 25 percent.

Security engineers thought the unexplainable rise and crash of Internet traffic pointed to some sort of new and sophisticated DDOS attack.

However, it turns out the strange rise in traffic was due not so much to an external exploit but because of golf -- or rather millions of golf fans. At that time, Tiger Woods happened to be in the middle a playoff round at the U.S. Open at Torrey Pines -- which also generated one of the largest Internet-wide flash crowds so far this year, according to security researchers at Arbor Networks Traffic Observatory.

http://asert.arbornetworks.com/uploads/2008/06/tiger.jpg

I mention this to point out that the ISPs panic when people use their service rather than plan for people using their services.

[BST]

The topic drifts with my whim and attention span!


:D



The network is pretty much in place. It is the most expensive "last mile to the home" that is the obstacle.


True. Telcos have generally been that "last mile" option until cable providers began offering service.





http://en.wikipedia.org/wiki/Dark_fiber

So what about all that dark fiber that exists, but is being held out of the market like DeBeers does with diamonds? It really makes the liberal anti-capitalists look righteous when the capacity is there, and it just isn't being used because it might depress prices and profits.

And, it was built by governments at various levels granting permits, exceptions, and right-of ways that a well funded start-up competitor might not be allowed to duplicate.



Correction, it was built by the telcos, largely AT&T but, there were others in various areas of the country, like the old GTE (now part of Verizon), Unitel, Alltel, etc.. Government involvement was as you mentioned, zoning, regulations, exceptions, etc.. Government did NOT fund the construction of the PSTN.



The concept of PSTN in a packet switched world is outdated. It is a pricing model that is driving the practice rather than technical necessity. It really is a telecom conspiracy to continue to gouge the consumer.



Agreed, hence the limited push for fiber optic installation. The only real constraint, now, is the cost and deployment in already developed areas.




Usage is usage, and distinctions between "normal residential usage" and business usage in another exercise iin corporate apologia. While "terms and restrictions" do apply, if a company advertises "24/7 always on, with speeds up to 6 Mbps" then I expect my personal limit of usage to be the limit of the ability of the network to provision my connection.
And the fun thing is, the way TCP/IP works is that when there is congestion, it slows down for everyone on the network segment. The case for network management needing pro-active usage deterrence is totally bogus.


Call it what you will. The scenario that I outlined is what does exist at this time.

[Darth Marley]

Correction, it was built by the telcos, largely AT&T but, there were others in various areas of the country, like the old GTE (now part of Verizon), Unitel, Alltel, etc.. Government involvement was as you mentioned, zoning, regulations, exceptions, etc.. Government did NOT fund the construction of the PSTN.


That was perhaps not as clear as it should be.
I view government regulation allowing both the monopoly, as with the exclusive rights to serve an area, as well as the "right of way" provisions that allow a utility to essentially seize property with the government's blessing for a particular purpose to be a subsidy.
That is what I meant with the "by government" phrase. Government acted as an enabler to allow various underground lines to be placed, and was selective in which companies were allowed to do so.

Telcos received such "subsidies" and now defunct fiber ventures got that benefit as well.

[BST]

That was perhaps not as clear as it should be.
I view government regulation allowing both the monopoly, as with the exclusive rights to serve an area, as well as the "right of way" provisions that allow a utility to essentially seize property with the government's blessing for a particular purpose to be a subsidy.
That is what I meant with the "by government" phrase. Government acted as an enabler to allow various underground lines to be placed, and was selective in which companies were allowed to do so.

Telcos received such "subsidies" and now defunct fiber ventures got that benefit as well.


There had to be oversight with regards to installation. I don't view this as a problem. I view it as a necessary element to the creation and development of a communications network.

[Darth Marley]

If you view it as necessary, then you are probably accepting a "natural monopoly" kind of model. Meaning that since it is so expensive and inconvenient to lay the lines, only one company can really do it.
Much like eminent domain being used to make public roads, municipal powers allow for similar "right of way" takings to benefit not the public in the case of a road, but a(n often) private company, in the case of a privately operated "public" utility.

The common view of the law is that such takings make regulation legit, and arguments about economic imperatives should be weighed against the "public good" since a public taking initiated the ability of the service, the service should forever be run as a public good. Nominal fees for maintenance and expansion of the network are reasonable. Evading expanding the network in order to pay dividends, less so.

Then, the matter of "pay per use" comes up, which is another part of what drives the "cap" controversy.

[BST]

If you view it as necessary, then you are probably accepting a "natural monopoly" kind of model. Meaning that since it is so expensive and inconvenient to lay the lines, only one company can really do it.
Much like eminent domain being used to make public roads, municipal powers allow for similar "right of way" takings to benefit not the public in the case of a road, but a(n often) private company, in the case of a privately operated "public" utility.



Yes, I do. To me, it is the only way to efficiently construct and then, maintain the network. I would willingly listen to suggestions on how it could be performed in an equally efficient and cost-effective process.



The common view of the law is that such takings make regulation legit, and arguments about economic imperatives should be weighed against the "public good" since a public taking initiated the ability of the service, the service should forever be run as a public good. Nominal fees for maintenance and expansion of the network are reasonable. Evading expanding the network in order to pay dividends, less so.

Then, the matter of "pay per use" comes up, which is another part of what drives the "cap" controversy.

When creating the "network", government involvement was an absolute necessity. Regulations were needed at that time, as well as consistent zoning ordinances, etc, regarding the creation of phone network.