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Why Free Services From Telecoms Can Be a Problem On the Internet
HughPickens.com writes: T-Mobile said last week that it would let customers watch as many movies as they wanted on services like Netflix and HBO as well as all other kinds of video, without having it count against their monthly data plans. But the NYT editorializes that there are real concerns about whether such promotions could give telecommunications companies the ability to influence what services people use on the Internet, benefiting some businesses and hurting others. Earlier this year, the FCC adopted net neutrality rules to make sure that companies like T-Mobile, Verizon and Comcast did not seek to push users toward some types of Internet services or content — like video — and not others. The rules, which telecom companies are trying to overturn in court, forbid phone and cable companies to accept money from Internet businesses like Amazon to deliver their videos to customers ahead of data from other companies. The rules, however, do not explicitly prevent telecom companies from coming up with "zero rating" plans like the one T-Mobile announced that use them treat, or rate, some content as free.
"Everybody likes free stuff, but the problem with such plans is that they allow phone and cable companies to steer their users to certain types of content. As a result, customers are less likely to visit websites that are not part of the free package." T-Mobile has said that its zero-rating plan, called Binge On, is good for consumers and for Internet businesses because it does not charge companies to be part of its free service. "Binge On is certainly better than plans in which websites pay telecom companies to be included," concludes The Times. "But it is not yet clear whether these free plans will inappropriately distort how consumers use the Internet."
"Everybody likes free stuff, but the problem with such plans is that they allow phone and cable companies to steer their users to certain types of content. As a result, customers are less likely to visit websites that are not part of the free package." T-Mobile has said that its zero-rating plan, called Binge On, is good for consumers and for Internet businesses because it does not charge companies to be part of its free service. "Binge On is certainly better than plans in which websites pay telecom companies to be included," concludes The Times. "But it is not yet clear whether these free plans will inappropriately distort how consumers use the Internet."
By the one of the few newspapers trying to charge for printed content on the Internet: free is bad for you. No self-serving there. I am appalled (appalled!) that there is gambling going on in here.
Any guest worker system is indistinguishable from indentured servitude.
Yeah, but 'free' video-over-ip is a clear conflict of interest.
For example, Comcast plans to start offering it's own video service and that won't count towards your 300GB cap. Surely you can see that this places Netflix and other streaming services at an unquestionable disadvantage.
The problem I had with charging services like Netflix and Hulu for special treatment is that it incentivizes ISPs (especially cellular ISPs) to provide a worse service to their end-users than is needed to fully enjoy streamed video content so they can effectively turn around and charge high bandwidth services a toll to access users on their cellular network.
This system from T-Mobile has a different incentive structure behind it though based on what I heard. Netflix and Hulu are NOT paying T-Mobile, they are just cooperating to make sure their data is not counted against T-Mobile's customer's data usage caps, which increases the value of all three companies services. T-Mobile has an incentive to offer this deal to any web-service that is well known and desirable enough to their end-users that offering access without a data cap improves the apparent value of T-Mobiles service.
On one hand telecoms are saying "We have to impose data caps because of the strain on our networks!" and then they turn around and make the most popular data heavy applications not count against your cap. Why are they not being called out more frequently and audibly about this blatant self-contradiction?
>It's why Walmart is so much cheaper than your corner convenience market.
Part of. At least as big a part is a hidden cost you don't even know you're paying. Wallmart's wages is so low that the vast majority of their workers still get poverty-relief welfare (in welfare-to-work states Wallmart is one of the biggest employers of welfare recipients).
That welfare comes from taxpayers.
Wallmart didn't reduce the price - they outsourced their wagebill to the taxpayers, you're paying the difference with your taxes - and all the people who never shop at Wallmart are forced to subsidize your savings.
If you ever wondered why a 15 dollar inflation-bound minimum wage is a good idea - there it is right there, so companies cannot outsource their wagebills to the taxpayer like Wallmart does.
Wallmart often threatens to close locations if anybody suggests doing it locally, but firstly there is no chance of that if it's done federally and secondly they have never actually made good on that threat.
In the real world even wallmart would rather make a slightly smaller profit than no profit at all.
Unicode killed the ASCII-art *