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The Facts & Fiction of Bandwidth Caps
wjamesau writes "What's the deal with broadband caps, like Comcast's 250GB/month data transfer limit, which goes into effect tomorrow? Om Malik at GigaOM has a whitepaper laying out the facts and fiction about Comcast's short-sightedness (which other carriers are mimicking), and how it will impact the future Internet: 'Given the growth trend due to consumers' changes in content consumption, today's power users are tomorrow's average users. By 2012, the bill for data access is projected to be around $215 per month.' Ouch." The white paper is embedded at the link using Scribd; for a PDF version you'll have to give up an email address.
I've been paying ~$180/month for 64k ISDN to my secret lair in the hills of California. On Monday, though, I get my T1, for $250/month! I think most people that use that much bandwidth may bitch about it, but they'll pay.
Luckily, I believe in the market and I think someone will lay the groundwork for serious bandwidth soon, instead of continuing to use copper for everything.
Me too. Except for one thing, the market doesn't exist. The cable companies has Congress in their pockets and the state legislatures, too. How can market forces work when many cable and broadband providers have legislated local monopolies? Or in some cases, get their boys in the legislatures to pass pro-industry regulation to "protect" the consumer which does nothing but get all the companies to follow the same rules that lines their pockets.
When we have real competition, then we'll have decent service.
Fire your Congress. Vote against the incumbent or vote third party. Show those assholes who's in charge!
Bandwidth caps are America protecting its poor infustructure. Were we in a backward place like Korea, Japan, or Singapore we would enjoy HUGE bandwidth and no limit for a reasonable monthly fee. The Duaopoly here is protecting its rusty wires and milking that much more out of them. we need fiber please, and not FIOS. Bring us real 21st century bandwidth here in the third (online) world..
- Minutus cantorum, minutus balorum, minutus carborata descendum pantorum.
We have had stupid caps up in Canada for at least a year now.
I am with Cogeco Ontario (Rogers Communications), for my cable internet, have been for years. I have a 60GB cap. They have 3 levels of service. Crap at 40GB. Normal at 60GB. Better than Normal at 80GB. They also implemented this cap pretty much without notice. So one day I had no cap, the next I did. I have even had my account disconnected due to going over cap (in fact it was the only way I found out I actually had one in the first place).
So don't cry about your 250GB a month cap please.
Ultimately unless the feds wake up and do something about these telecommunication giants taking advantage of markets and ripping consumers off not a bloody thing will happen. People are getting fed up, which will only become more apparent at time goes on. I would think it will only be a matter of years before the politicians start leveraging this for votes and then some sort of change will take place. However until then, it will be annoying, and we will all live in sucksville (at least if you stay in North America).
Bell can also stuff it as far as I am concerned. In Canada there is only Bell and Rogers, a duopoly, so there is not much choice. I hope the CRTC rips them all a new one and soon.
I have observed the price per bit of broadband dropping recently. My comcast service has gone from 1mbit to 3mbit to 6mbit over the last 5 years with no change in price.
The introduction of the cap, of course, significantly complicates that computation.
"Who is the Journal of Quantum Physics going to believe?" --Stephen Hawking
I almost agree, with one exception.
Verizon.
They are spreading FIOS like wildfire, and it is a serious contender to the cable companies.
I now have two choices for wired phone, internet and cable TV - FIOS and Charter. Wherever FIOS is going that has cable is becoming at least a two horse race, instead of a one horse race. And Verizon is laying all new infrastructure.
So, if the blowout continues, I forsee at least 2 infrastructures in place, and the cable companies will have to learn to compete with Verizon as they are currently blowing their doors off (except for their channel guide - The FIOS channel guide sucks. ;-) )
Note that I specifically did not mention wireless or satellite providers, as their service is nowhere near equivalent and cost competitive.
Same here. When I got my first DSL connection 2001 I was paying Verizon around $40/mo. for a 768/128 connection. Over the years, that went from 768/128 to 1500/384 to 3000/768 without any significant change in price. These days I pay around $60 for a 20000/5000 FIOS connection. The price of bandwidth has most definitely dropped.
"People that quote themselves in their signatures bother me" - athakur999
One thing about all these discussions is everyone assumes the cap won't move. Comcast hasn't said either way, but if it doesn't then we're screwed. If it does, then no big deal. It's just a way to get people who hog bandwidth to upgrade to business class. I already know what everyone here thinks about this, but I believe there is just barely enough competition in the US broadband market to think that this will be moving in the future.
> Great idea. Quick question: how will that wifi network connect to the Internet?
Ok, work with me here. Imagine the bandwidth cap drops to 100GB/month. Hard drives are still cheap and huge and will be cheaper and even bigger by the time this problem ripens. 802.11n will also be commonplace by then. Ok, so everyone participating in a neighborhood net is expected to buy the current reflashable linky, at least 1TB of drive and a 10dbi omni antenna, The AP does all of your bittorrent action, something ASUS is selling now, a browser plugin offloads all .torrent links to the AP, you monitor your downloads on a webpage it provides and when it hits 100% you access the files via a samba share.
Ok, now put this AP on a 10/8 net and it can see the neighbors and your outbound net. It's torrent client has been modified to prefer local peers by a ratio close to the number of members. It also assists in torrents a neighbor is working even if you aren't interested in the file, at a lower priority on the pipe to the outside world. It does something else interesting, it only caches the blocks it downloaded, thus distributing a cache of those files amongst the peers and greatly increasing the effectiveness of the cache. If you later decide you want one of those files your client gets the rest almost exclusively from the local nodes.
Now imagine a future where video over the Internet was about to launch but the cable companies and telcos squashed it in favor of their video on demand pay per view crap. Get fifty neighbors together and together they have an aggregate bandwidth cap of 5TB. If everyone is watching a totally different set of shows it won't help much, but there will almost certainly be a fairly good overlap. When a new episode of moderately popular show X is available the dozen or so people who want it will be downloading it in parallel across their net links and swapping the blocks across a much faster 802.11n WWAN aided to a lessor extent by the 38 peers who aren't interested in that program. And cutting the hit on their bandwidth cap by that same factor of 12+ but offset by helping download stuff you didn't want to help somebody else. And if anybody else later decides they want to watch it before it times out of the caches their cost is zero. By having one smart host do almost all heavy downloading it can know the caps and adjust it's activity to avoid hitting them.
Democrat delenda est
"So, is your argument intended to suggest that the USA cannot improve its internet access?"
Nope, just pointing out the reality of the task. May here (some Americans and some not) believe laying fiber to improve service in the US is a simple matter when they don't get just how big and spread out this nation is (most Europeans cant wrap their mind around it either).
"You might not be able to reproduce internet access to the levels enjoyed by many other countries at the same cost, but you can improve it so that people are not tied to a a single provider"
People *are not* tied to a single provider. I can go with Comcast, Verizon, Road Runner, SprintPCS, and others. When people say 'you only have one option' they generally mean for a cable modem and ignore other methods of access.
"Tell me that again in a few years time when your businesses cannot compete because they cannot communicate"
Businesses generally don't use the kind of access that were discussing here, the bring in a T1 or use a co-location for hosting. You're confusing residential options with commercial options.
"when a large proportion of your population cannot get adequate TV coverage because the digital revolution has left them unable to get analogue signals"
Ummm, what? the US is *giving out converter boxes* for the digital signal conversion and TV access in the US will be as far wide and deep in march 2009 as it is today.
"Ahh! Arrogance and stupidity in the same package, how efficient of you!" --Londo Molari
And Albany, Syracuse, Utica.... Get out much?
In Korea 50% of the population lives in *1* metro area, in Japan 14% live in and around Tokyo, and 25% of the population live in just three metro areas! with the average distance between metro areas being next to nothing.
"Ahh! Arrogance and stupidity in the same package, how efficient of you!" --Londo Molari
What about subscription based services? what if I'm subscribed to MLB.com and and watch every game I can and use Vonage on a consistant basis to make calls and I stream my music online? what effect would this have on my bandwidth and would it move me away from competing vendors? Would I then find it more cost effective to drop Vonage and use Comcast's Phone service and watch my games via subscription through Comcast? I think there is more here than meets the eye and only after it's implemented will we see the true fall out. After all what better way to kill the competition than to make it impossible to do business in your area
no matter how good it is, it is human nature always wants to make things better
Cable services are shared for the last mile between the homes that they pass. For Comcast, the last numbers I saw (from the fairshare information threads) were ~250 homes per downstream. The higher the per-household usage, the more they have to split up that grouping - which requires putting more cable in the ground, setting up equipment, etc.
This is the bandwidth crunch the cable companies have, not the core of the network. The article actually does not address that fact at all, and seems to assume infinite edge bandwidth with limited core bandwidth. This is true in an enterprise network, but is not true in a cable network today.
With the huge capital outlay for infrastructure, there would be de facto monopoly, as there would be no way for a company to offset the capital expense with sales. The existant monopoly (the first entrant) would underprice sales to the point where the second entrant would be forced out of business.
Let me stop you there: either you believe that a false dichotomy straw man is a useful component to discussion, or you do not. This not about rights, it's about economics. You can spin it as rights all you want, but the simple fact is that individuals have long traded individual rights for collective good, and it's a matter of scale that determines how they choose to govern themselves.
And who is going to pay to build out a parallel line? No one -- they know they will not be able to compete against an existant monopoly.
you can go on about violation of rights, etc, all you want, but the simple truth is that markets like this are inefficient by nature, and will result in monopoly time and again due to huge capital outlay requirements just to enter the market.
Go on and blather about anarchy and rights all you want... but admit that the outcome is not always best for the individual in pure capitalism, due to imperfect markets.
My argument against this is that it does not work due to inefficient markets. If the cable market were perfectly efficient, then it would make sense to lay out a competing parallel infrastructure... as long as all markets were perfectly efficient. But, if there existed a non-efficient market somewhere, that capital should be invested in that market, to take advantage of the inefficiency. End result? The capital to build out the infrastructure is only invested if expected returns are better there than elsewhere... and given the existance of a current monopoly in that market, there is no way that the best choice is to invest in that infrastructure. So -- no one builds out the redundant infrastructure, and competition doesn't magically appear just because you want it to.
My other argument against it is that it is folly to believe that a functional system can exist where no individual gives up rights in exchange for benefit. This is the nature of collective law. What matters, then, is to what extant you believe a collective group should be able to make decisions for the common good. It's just splitting hairs... you draw the line one place, I draw it somewhere else. None of which matters to the question at hand, which is "How would a competitive environment come to be in a market with a huge barrier to entry and an established monopoly in place, without regulation?"
Please, take your straw man and stuff it. I don't really care what your views on rights are... what I want to know is whether you have the economic understanding of what you propose, and how you think it is possible for a competitive market in cable to arise without regulation or state sponsorship of the infrastructure.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
20% of Finland's population lives in the Helsinki Metro area, another 10% live in just three cities..
40% of the population in 4 metropolitan areas..
IN the US the top 4 metros NY (18 Million), LA (12 Million), Chicago (8 Million), and Dallas (5 Million) together contain just 15% in those ares who's mean distance apart is far greater than Finland..
"Ahh! Arrogance and stupidity in the same package, how efficient of you!" --Londo Molari
ISPs currently (at least to in the UK) have been racing to the bottom of the market.
Price is what is currently selling. Nobody cares about email servers, nntp retention (if it's even offered) etc etc - people are buying whatever's cheapest. Your ISP is a utility - in fact they care even less. Your water rate might be fixed, but your gas and electricity charge you on the basis of how much you use. Your ISP is generally accepted to provide 'internet' for a fixes price. A small sub-set of the market might care about the headline transfer rate, but it's an even smaller subset that care about the small print.
Basically we are so so so much the minority on these issues for even noticing they exist. More to the point we are the 'hogging consumers' - I can guarantee that you all download more than my mum.
The small print is going to get noticed soon, and it won't be my us - it'll be the people who signed up to netflix beacause of a mail-shot. It'll be the people that wonder why that 360 demo takes longer than it's supposed to.
So how will the market respond? Well there'll be new 'premium' packages that don't throttle for us - but 90% of punter would be happy if say a dozen sites were excluded from their caps based upon their popularity/kickbacks to the ISP.
Take Netflix or Amazon unboxed. Most end users have currently not heard of either of them - but in 5 years time they'll be watching media-less films on their TV. How will they decide which? Well their ISP will tell them.
The WiFi router most ISPS now offer pre-configged will have an HDMI socket on the back and a remote control. It will provide you movies from and the download due to peering will run at full whack.
Even if you're a 'low kbps' subscriber, your ADSL line will suddenly hum at 24Mb to get that movie onto your TV and that charge onto your bill asap. Market will then move subtlely - you'll be offered a slightly higher charge for, I dunno, 1 free film download a week. Then there'll be the premium unlimited rentals model - in summary your ISP will become your Cable TV provider.
You do realize that the online habits of those few who are "causing problems" for the ISP will eventually become mainstream, right? The ISPs can't head off the inevitable digital download era that companies like Apple, Microsoft, Google, Netflix, etc., are ushering in.
Sure they can. If they don't provide the bandwidth, they don't provide the bandwidth. End of statement.
... or it would be, if certain companies weren't inside a zone of magical Federal protection.
The only thing that will prevent that ugly scenario is Congress allowing functional competition. There are plenty of big companies out there with deep pockets that would love to spend some of that money building out a guaranteed profit center. I mean, broadband is certainly a growth industry right now
The higher the technology, the sharper that two-edged sword.
So yo have a duopoly, great!
In much of Europe, any ISP can put their DSLAM into the exchange and access the copper to your house and anyone can run their fiber networks into these exchanges. Incumbent telcos must re-sell their network to other ISPs at wholesale prices.
In fact, to bring in competition, regulators mandated initially telcos spin off their ISP business, which then had to buy wholesale from the telco, just like competing ISPs. Did the telcos fight this all the way? You betcha! But at the end of the day, they are crying all the way to the bank.
All this results in a plethora of competing ISPs and 8mbit and above ADSL with no usage limits for about US$30.
And this will not get in the way of future upgrades, if the market is there it will be built. They will eventually put in fiber even if they have to re-sell that last mile too because it makes business sense to do so. You don't need a monopoly to trick companies into investing - it is the telcos tricking they government into thinking they need to be tricked into investing!
Actually with many VoIPs like SpeakEasy or Vonage, we can get unlimited phone calls (locally, nationally, and even internationally) for a fixed rate. Many POTS phone providers and Cell Companies also provide unlimited plans.
The problem with VoIP (and cell phones, and even land lines now) is that it (they all) relies on internet access, which is usually not metered for end users (different deal for providers, if you've ever used shared hosting). Once data to customers is limited, VoIP costs may take a hike and you'd be correct.
Internet is not a common utility like water or electricity, you can not judge it as such. Only phones can be truly considered similar, as they relay information and not physical goods.
Some community wireless networks sort of do this.
People download what they want over the internet and everyone shares it over the wireless network which is free. IRC for communication and FTP for sharing is mostly used since its simple, easy to use, compatible with just about every operating system and doesn't create lots of connections like p2p which can affect wireless networks.
I agree,
If broadband is metered the same way Utilities/Electricity is, I sure would be paying alot less than even $49 bux a month for Comcast. I think people who are streaming HD should have to pay more than the old grandma who wants to check her AOL mail.