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Time Warner Transfer Caps May Inspire Fair-Price Legislation
Time Warner's recently announced plan to expand their broadband transfer caps to new markets drew heavy criticism, which prompted their attempt to smooth things over with a ridiculously expensive "unlimited" plan. That wasn't enough for New York Representative Eric Massa, who now says he will draft legislation to "curb tiers, particularly in areas where a broadband provider owns a monopoly on service." Massa said, "Time Warner believes they can do this in Rochester, NY; Greensboro, NC; and Austin and San Antonio, Texas, and it's almost certainly just a matter of time before they attempt to overcharge all of their customers," adding, "I believe safeguards must be put in place when a business has a monopoly on a specific region."
The real solution is to get rid of government-enforced monopolies on utilities.
These ridiculous caps are all about cable companies protecting their becoming-outdated business model. Right now, they charge for content (HBO, various extra channel packages, etc.). Customers getting high quality video (for some definitions of high quality) from places like Hulu is eventually going to eat up the cable monopoly cash cow that Time Warner Cable currently enjoys. So how do they stop it and protect their outdated business model? Caps. Insanely low transfer caps that all but eliminate high amounts of streaming video and that protect their cable company business.
If there's a reason the gov't should step in and put a stop to low transfer caps, it's this.
-S
--- What parts of "shall make no law", "shall not be infringed", and "shall not be violated" don't you understand?
I don't see why this wasn't enacted many many years ago.
Comcast, for example, would buy all of a region's smaller cable companies and make them fly the Comcast banner. Then prices would jump 20-40% in the next year. Usually the buy-outs would have to be approved, and would be approved under the condition that Comcast provide similar service for similar prices.
Granted monopolies need to be policed like this. This isn't a case of other companies not wanting to bother with the cost and time to set up competition.
This is exactly what Time-Warner was banking on. You don't see cell phone companies deciding that unlimited text messaging is no longer unlimited, or that your 500 minutes isn't sustainable, so now you get 200 minutes. Mainly because cell phone companies have competition everywhere. If you don't like Sprint, try US Cellular or Verizon. Maybe even T-mobile. They all have their ups and downs, but more importantly, there are alternate choices. ISPs aren't always that way.
Hourly-fee dial-up ISPs went away pretty quickly once competitors started popping up. I think most broadband ISPs were starting out at the unlimited level to compete with dial-up ISPs, and now that the dial-up ISPs are no longer a threat, they want to reneg on the contracts they made us all sign. Not our fault your business model wasn't able to be supported, now honor our damn contracts.
Job? I don't have time to get a job! Who will sit around and bitch about being broke and unemployed then?
It is not so much the caps.. it is the fact the the rates are 3-5x what people are paying now which is, antidotally, 2-3x times what most people around the world pay. Caps wouldn't be so bad if everyone got some benefit.. as it is it is just an excuse for the ISPs to grab a 3-5x price increase.
I pay X amount of dollars to have Y data download rate (and Z data upload rate). My ISP advertised the rate, I bought the rate, that's what I expect them to be able to deliver "most" of the time.
Now, if they want to put a cap on my useage, say C gigabytes per month, then if that limit is less than (2592000 s * X bits/s), I expect my useage fee to decrease proportionately to however much smaller my new download limit becomes.
DECREASE. Not increase. They will be taking away value that I expect based on the advertised service. I expect to pay less for less value.
If you try to keep the competition out of an area the the gov should cap your fees and that's not the same as getting unlimited amounts of a more scarce resource, like clean water, for one fee.
you both probably get better and faster service for both TV and internet than I do with Embarq and shantel. We've got no cable option for internet and embarq's had a monopoly here since before it was Embarq, the wires are literally disentegrating and calling for support on anything will half the time get you hung up on because they have no need to do anything to keep you as a customer.
A bullet may have your name on it but splash damage is addressed "To whom it may concern."
Since the subscriber has no control over the amount of data sent to him from a site (ads, flash videos and music that play automatically, etc) it's hard to see how people would be willing to accept a pricing model that charged them for data they hadn't asked for and didn't want to receive.
The main problem we have with it is the industry should be providing MORE service for less money, not the opposite.
Good-bye
It's much more unlimited than water and if there's no competition then how can you honestly say that they're going to be the one and only good company and charge a fair price?
You'd have to be really slow to believe that.
Bandwidth and infrastructure does cost money.
But heres the reality. In the Greensboro area (where I live and know what goes on at the TWC datacenter) they charge approximately 100 times what it costs them to provide the bandwidth and infrastructure.
We complain because some of us who work in the industry know how much bullshit the prices are and more importantly we know for a fact that their traffic shaping and caps are not because its expensive, they are because they simple do not want to pay for the bandwidth they've sold.
The infrastructure they have is more than enough to support much more bandwidth with the switch to DOCSIS 3.0, which they are already doing.
The only limit is the pipes from them to the rest of the world.
When they drop services, they don't lower my price.
Why am I still paying the same price when they outsourced their news servers and put the entire north and south carolina region on a single link to giganews which was saturated during the TRIAL PERIOD, before the moved everyone on to it. It was never upgraded, users just get slower and slower news service, and they spend less and less, and I still pay the same thing.
Until you actually know what you're talking about, don't try to convience those of us with a clue about how much it costs to run a network. Some of us have done it and know its bullshit.
Their prices are hardly fair, take a look at their rate plans, do the math, compare them to what a normal business pays for unreliable service like the provide to the home, then get a clue.
Persistent Volume manager for Kubernetes - https://github.com/dwimsey/openshift-pvmanager
I'm in Austin, so I stand to be affected by this in the near future.
I wouldn't be opposed to a metered plan if it was really a metered plan.
The electric company doesn't care how many toasters I own, or how often I make toast, or anything. They charge me an activation fee when I start service, and then they bill me for the electricity I use. THAT is a metered plan. If I could do that with bandwidth (at a reasonable rate per GB), I'd be perfectly happy.
This Time Warner crap is NOT like that. They want to charge me an activation fee, a monthly usage fee, AND a dollar per gigabyte for every GB over their arbitrarily imposed limit. That's NOT cool.
The basic point of the pricing structure appears to be to control my behavior online, and it irritates me no end.
Because cable companies have increased their rates at about twice that of inflation for years. My bill has gone from $40 dollars for a platinum package (all channels) 10 years ago to $150 for silver package and far less service than I had then. My internet speed has been increased by 2.5 Mb/sec in 10 years as technology advanced (when they switched to fiber a few years back).
In addition, these companies took millions of dollars in funding from the government to improve their infrastructure for just this very reason. To plan for future capacity. They did nothing with it other than spam additional channels in tiered packaged that no one wants and are now overselling internet bandwidth (according to them) even though I never see a slowdown and haven't for years, even before fiber.
On top of that, they have a monopoly in most areas where people who want broadband have no choice but to pay if they want to retain anything other than dial-up. They expect me to pay what I pay now for an unlimited plan, with cable and premium channels, just for the internet access I have now.
It's obvious they are doing this to prevent competition from sites like Hulu. With the internet, you really don't need cable tv. Given a good pipe and content providers offering up content directly, it severely compromises their business model. This technology should be dirt cheap these days as usually happens with wide adoption, yet the price for broadband keeps skyrocketing. There is no where near enough competition.
Cable companies have been gouging consumers for years with anti-competitive agreements with local municipalities that prevent other telecoms from entering the scene. If I had another option, I'd take it in a heartbeat. Perhaps this will put some regulation back on them until there is competition or at least an environment that fosters competition.
No, I wouldn't. But if I go in to that restaurant and start eating and, after 5 plates, they tell me that they won't give me any more, that I've reached my cap, then yes I will expect a refund. They didn't include a 5-plate cap in what they offered, it isn't included in what they offered. If they want to change the deal to something that does include it, then you better believe I'm going to want to change my end of the deal too to reflect what they're offering from their side.
The difference between TW and your scenario is that in your scenario the consumer's deciding not to use all he's entitled to, with TW it's TW deciding the consumer won't be allowed everything he's entitled to.
CEO of time warner said that broadband costs are spiraling out of control.
Their SEC Statements for 2008 said YOY operating costs for their broadband service decreased 11%. It also netted them nearly 4 billion dollars in revenues.
In 2007 they also reported decreased operating costs and massive profits.
I'd love for that asshole to testify to congress the same thing, cause I'm sending my congressmen their 10K statements. Maybe a CEO going to jail for blatantly doing nearly the same shit bank CEO's and other officers have been doing will finally wake these people up.
http://stopthecap.com/2009/04/10/why-is-time-warner-saying-costs-increasing-to-consumers-but-decreasing-to-stockholders/
Exactly, look at wholesale bandwidth charges where there is fierce competition and see how price per GB has gone down in a very non-linear curve. Contrast that with home broadband which is generally controlled by a monopoly or a small oligopoly, price per GB has actually tripled (compare dialup 53Kbps @ $10/month in the 90's to TW's lowest tier @$30/month for the same amount of transfer).
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
I would really love to see the telecoms pipe separated from the cable television. Force them to rent from the telecom companies while ensuring that the Telecom companies themselves couldn't get a monopoly on entire regions.
Better yet, have each city pay and build out the fiber network and treat it like a utility to the content providers. That would open up the industry to competition as they wouldn't have to own and/or build the pipes to deliver their content, it would regulate the cost of the pipe itself, and the taxpayer would eventually earn back the cost of building the network via the rental to the cable/internet providers. It would also remove a huge barrier to new competition entering the area as they won't have to build out their own fiber lines to compete.
Sounds like a pipe dream though...(ouch..bad pun)
That would be a good argument except that we have examples from many areas around the world where much cheaper internet with much higher capacities are available.
Now sure- you could suggest that japan or korea are small. But so are new york and most other major metropolitan areas.
It is extremely clear that we are being ripped off big time.
It may go into city coffers as bribes/fees, or it may be going straight in the pocket of the back bone providers, or perhaps the monopolistic city ISP's.
But it is clear we are being ripped off because we have many counter examples of the same thing being done better, faster, AND cheaper all around the world.
She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
Free market capitalism becomes corrupt when a few people (or pseudopeople(Corps)) buy up the market.
That is not a freemarket. A freemarket is a "free market". If I wanted to and had the money in a free market I could have cable or fiber optics lain down to provide any and all services it could handle. But there is no free market. Instead the telecos and cablecos try to block competition by blocking access. The radio and TV broadcasters do the same with the airwaves.
Seems like corruption is the natural consequence of capitalism.
Corruption doesn't apply to capitalism any more than it applies to communism and socialism. Anything and everything, including churches, mosques, and temples are susceptible to corruption.
Falcon
Should there be a Law?
I have a redundant 100 MB/s fiber link in Chicago that I pay $3000.00 a month for. Conceptually, I can achieve a data transfer throuput of 259 TB per month. If I use TW's new business model by selling data throughput at $1.00 per GB, I could realize a net profit of only $262,216.00 per month. I better think of raising that fee to $1.25 per GB (I may need the extra $66,304.00/month to pay the perception management team and lawyers when I am done). Go figure, I didn't even get any of the free massive government "Internet Infrastructure Support" cash a few years back like TW did (1.22 B). No wonder they are farther along in thier "Rape the general consumer" business model than I am! On the other hand, I guess I need to branchout... I hear there is someone in DC handing out cash again....
That is a good point. And as long as they hold their monopolies, then this particular aspect needs to be regulated. That is, with respect to services that they offer over their lines, they have to behave like common carriers.
We've tried incentives like huge tax breaks to get them to modernize their networks to increase capacity, but they tend to just pocket most of that money and go right on raping their customers. I blame government corruption and incompetence for that. If you're gonna put the carrot out there, you'd damn well better have a stick too.
As long as they're allowed to have control over the last mile to homes and businesses, we're all gonna get screwed. That infrastructure should be a municipal asset where we can contract out maintenance and upgrades, and then allow any provider that wants to compete to have access to deliver service over that infrastructure. Right now we are pretty much stuck with them whining about how it's so expensive to provide service and increase capacity. That's bullshit when they've been given more than enough time and money to do so, in addition to the ability to charge duopoly-size fees already. I won't be crying for them.
It's not enough to bash in heads, you've got to bash in minds. - Captain Hammer