Would you be happy with metered internet in return for enforced net neutrality?

Dylan Tweney looks at the consequences of regulatory mandates on net neutrality: if the ISPs can’t hit up content and bandwidth providers, they’ll hit up consumers.

It seems the most reasonable outcome: the consumer pays, the consumer gets. As the simplest and least obscure business model to run the tubes on, isn’t it worth rationalizing prices to guarantee open access? Tweney, however, points out that the additional bureacracy being layered atop the market could stifle innovation:

Net neutrality regulations make sense in closed, monopolistic situations. But outside of small, rural markets, most of the U.S. offers a high level of competitive choice. Don’t like Comcast cable internet? Switch to SpeakEasy, Astound or SBC, or look into satellite internet. Don’t care for AT&T’s spotty 3G wireless network? Try T-Mobile or Verizon. Need help finding an alternative? Check Broadband Reports’ interactive ISP finder.

That’s why the FCC should take a very cautious, careful approach to implementing its brave, new principles.

FCC Position May Spell the End of Unlimited Internet [Tweney Report]

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24 Responses to Would you be happy with metered internet in return for enforced net neutrality?

  1. kattw says:

    Maybe? As other commentors mention, internet access is never what it’s advertised to be. Those 30 meg/second plans clock in at 200 kB/second, and etc. Chances are, a metered internet would fall apart, since they couldn’t possibly advertise “12 gigabytes per month, peak hours only”, and I bet they’d never manage to cut you off at the right time. The lawsuits would flow!

    As for charging the producers, let’s not forget that they already do. The ISPs charge the consumer for one end of the pipe. Then they charge, say, google, for another end of the pipe (and many ends at that). They just want somebody else to charge, and have run out of people, so they’re trying to add new fines.

  2. remmelt says:

    Airpillo: that was sarcasm. Sorry.

    Also, the question:
    Would you be happy with metered internet in return for enforced net neutrality?

    I didn’t know that was a choice we need to take? Right now, we have unlimited access to the internet, both ways (consumer and content provider) and the access already is “unmetered” (for low values of unmetered, admittedly).

    So the answer is no. We already have unmetered, net neutral internet. We want the same thing. Don’t change it.

  3. Rob Beschizza says:

    What happened to Zuzu? Banned?

  4. gwax says:

    I don’t buy the competitive choices option; living in San Francsico, I have two options: expensive Comcast Internet or expensive, slow Internet from someone else. I don’t have choice and I only barely have the illusion of choice.

  5. Rob says:

    But outside of small, rural markets, most of the U.S. offers a high level of competitive choice.

    Excuse my language, but bullshit.

    I live in a high tech city. I have a choice of 1 broadband provider. Two if you want to count a reseller.

  6. Rod says:

    My ISP here in the UK already does metered internet. The monthly cost includes maximum peak and off-peak limits, and using more than these limits (for me, 1Gb month peak, 50Gb month off-peak) incurs a per-Gb charge. It works quite well, seeing as they also send you messages when you get close to the limit. Only hit the limit occasionally, mainly when downloading new nix distros.

  7. AirPillo says:

    Sorry for not catching your sarcasm #17. My fault for being pedantic.

    I agree entirely, by the way.

  8. Rob Beschizza says:

    Indeed. It’s a big deal, presented as a victory for competitiveness, that Pittsburgh just let Fios in. The current choice is Comcast or dismally uncompetitive DSL.

  9. dculberson says:

    Rob, I really don’t know! I don’t think he’s banned, I think he just kind of disappeared.

  10. dculberson says:

    Ifriit is right on. Although in my town we do have two local cable providers, WOW and Time Warner, there’s only one telephone company and so DSL is always basically from them.

  11. Hugh says:

    +1 for there not being competition amongst broadband providers in the US. I’ve lived in reasonably urban areas of California and Michigan, and my options were either the one big cable provider, or the one big DSL provider, or the various small-fry resellers necessarily following their leads.

    If you don’t count DSL as competing with cable (which I don’t) then there was one option and you took it and they treated you accordingly.

    I agree that metered anything is a different and more nervous experience than all-you-can-eat, but I think differentially delivered internet would be even worse.

  12. Zappa's Ghost says:

    This entire meme is a total false choice. We don’t have to choose between an open Internet or a metered internet. We can have both! This is an industry promoted meme. The two have nothing to do with each other.

    Check this 2008 paper out on this exact topic:

    http://www.freepress.net/files/Blocking_or_Metering_A_False_Choice.pdf

    Also, the notion that competition will ensure net neutrality is totally bogus. Canada has more competition because of unbundling open access rules, but they suck on net neutrality. The cellular market is more competitive than the wired market, but they are far more closed. This is a market structure issue, not a market competition issue. In fact, the Law recognizes this, which is why the FCC is not allowed to grant companies forbearance from the principle of non-discrimination in Title II of the Communications Act, but they can remove other parts of the act in the cases where competition develops.

  13. AirPillo says:

    Stifle innovation? As opposed to the current situation, where the USA is the clear world leader in broadband internet and cellular networking?

    I don’t know what USA you’re referring to, but broadband penetration here is behind nearly all of the developed world, prices are higher for even remedial broadband, and the only promise and obligation made to the customer is how high your connection speed can theoretically go.

    You can be getting 28.8kb speeds on a 10 megabit cable plan and have no legal recourse against your carrier other than to switch to a different one and hope you’re screwed less.

    As to metered internet: This would be repeating the errors that stifled innovation on the AOL pay-by-the-minute plan all over again. Shrugging off the kind of oppressive knowledge that there is a limit working against your web browsing is what allowed a lot of internet innovations to flourish in the first place.

    Knowing this, and still wanting to try it all over again, is frankly a level of incompetence on ISP’s part that could be excused only by severe mental retardation.

  14. AirPillo says:

    It’s a sad comment on broadband availability that I am within a very easy commute of downtown Los Angeles, and I would rejoice if Fios was available to replace my current crappy DSL, also provided by Verizon.

    Time Warner’s cable connections in this neighborhood are fairly fast, around 6 megabit down, but the options for broadband are exactly two: fast cable with flaws, or DSL that is literally slowing down by the month.

    My only other option for broadband is an FTTH service from the same company I currently have, which they seem to have no interest in selling to my neighborhood.

    I have money! I want to exchange it for fast internet! Why doesn’t someone want to claim my money?

  15. William says:

    I think people should aware that is is a false dilemma. It is not an either or situation. Frankly the ISPs are absurdly lucky that content is provided to them for free by the businesses and that the delivery of free content has a market.

    To not have net neutrality undermines the business model of providing the content bringing back an AOL system of content distribution. Moreover, in effect the issue of a metered communication system has already been modeled in the telephone system. In fact apply both issues to the telephone system, and you might see my point.

    Only by providing more services( rather than limiting the services that we have) or driving down price can business compete (see the phone). Otherwise you have a potential for an unjustified monopoly leading to a lack of innovation, and laziness in businesses, making them unable to compete in the world market and eventually driving them and their customers out of business.

    This should be a WIN WIN situation – that is the American way. DO you really think consumers would want to lose if given a choice, we will just shift to an alternate technology or provider (cable, phone companies and satellite corporations now compete on some level in the same markets).

    Don’t scam your customers, and they will give you a profit. It really is not a hard concept.

  16. Chris S says:

    I’m thinking of the current situation in cellular, where we have (well, in Canada and the U.S.) postpaid almost like unlimited plans competing with prepaid, metered, plans.

    I switched, and I’m saving money big time. I have all the services I had before (caller ID, voice mail, call waiting), I have a nice phone (for which I paid $130), and yet – including the cost of the phone – I broke even eight months after switching from a monthly bill. Now I’m saving money. (I even added on-device browsing – and I’m still paying less.)

    There’s a point, though, where you have to be tough with yourself. I pay more for long-distance. One of my calls actually ran to about $6 – never would have happened under the old plan. But in order to prevent that, I paid handsomely EVERY MONTH. And if my usage suddenly changes dramatically, some other option might be a way better deal than where I am now.

    Salesfolk know this, and they will hit you with this point. About how you would pay ‘extra’ those times. And how easy it is to be on a flat rate. Yep – it’s ea$y, all right. No worrie$ at all.

    If a metered Internet would resemble the prepaid cellular market, I’m all for it.

    As for innovation – think about electricity. These days, the fact that your electricity is metered *drives* innovation, rather than impedes it. If we were all on all-you-can-eat flat rate monthly electricity bills, selling CFL bulbs would be a lot tougher.

    I realize that it’s not a perfect analogy. But think about how well BitTorrent could actually work if it took into account both the timing and location of everyone when planning a download – if you could share the cost of downloading a movie between 100 people in your neighbourhood who are all on a neighbourhood LAN, so that you each take 1/100th of the whole thing? There are opportunities here – but right now, there’s no benefit to pursuing them. Nobody conserves bits, because nobody pays by the bit.

  17. getjustin says:

    I say yes, but here’s the problem. A metered internet would mean a serious shakeup to the business models of virtually any internet company. First, I don’t want to be metered for ads, the chief form of revenue for most of the web. Also consider sites like twit.tv. Am I going to pay to stream Leo bouncing on his ball?

    However, this would put a quick end to a lot of extraneous torrenting lessening the need for ISPs to meter in the first place. As annoying as it is, I think Comcast has struck a good medium. Yes, there’s a cap and you need to lock up your wifi so you don’t get taken, but the limit is so high as to be non-existent for the vast majority of users.

    I’m curious what others think.

  18. remmelt says:

    Stifle innovation? As opposed to the current situation, where the USA is the clear world leader in broadband internet and cellular networking?

    I don’t know if it’s the same over there as it is in Europe, but we get very unclear deals about speeds and limits with our broadband. Cheap, though. If the providers would be forced to tell us exactly what we get, and then deliver on that deal, I’d be willing to pay for that, sure.

    The competition argument doesn’t add anything either. Sure you could go to any other provider, who will have a deal with Bing and Universal, where I wanted Google and Universal for speedy connections.

    Don’t forget, the providers have built their networks on the prices we pay them now. All of a sudden someone got the great idea that they can bill the content providers as well. Now they act like they cannot go on without this money and that it’s their right to demand it, even forcing it upon the people in the form of law (well, if they’d have their way, that is).

    There will not be a provider who does not want to make deals with the content providers, because it will cost them money. Also, consumers are too dumb to know what to want or what is technically feasible. See also: there are no cell plans with free sms, even though sending sms costs the telco nothing. (Not next to nothing, literally nothing. Zero cent.) This is why the competition argument is lame; there’s just no-one to turn to.

  19. brianary says:

    That would certainly kill hulu.

    It would have been fair 15 years ago, but the web hasn’t been built to be particularly bandwidth-efficient. The protocols and formats of the web are text, not binary, and include tons of useless info, such that every part of every web page is amazingly wasteful.

    Each hit isn’t enough in itself to dramatically affect your meter, but in aggregate, I wouldn’t be surprised if these inefficiencies meant that at least 30% of your traffic was overhead.

  20. mkultra says:

    Yes… this is a possible outcome, at least temporarily.

    There are two things keeping metered internet from becoming the standard in this country.
    1. In the parts of the country with the most net usage, there are already many different ISPs and different broadband providers. They are in hot competition with each other.
    2. Americans hate metered anything. By and large, we hate it with a passion. Even if we only use 75% of a particular bandwidth cap, we’ll pay more for unlimited access just so we don’t have to worry about it. We’re lazy that way.

    All it would take would be for one of the many ISPs out there to re-introduce an unmetered all-you-can-eat plan, and all the others would fall into line or risk losing most of their customers. Besides, cable internet is already throttled by the very nature of the technology: if a bunch of your neighbors are downloading Hulu stuff, your bandwidth is cut way down. People understand this and accept it as a limitation of the system.

    As for wireless? Well, who cares? Torrenting and the like is an abuse of the system anyway.

  21. dculberson says:

    Too bad Zuzu isn’t around much any more, he could make a much stronger argument than I could as to why metering an internet connection is ridiculous. But it is. Yes, laying the lines is expensive, but maintaining it is very, very cheap per-user. And operating it costs no more if the pipe is full versus if it’s empty. This is not a consumable resource.

    If it isn’t workable to have unmetered internet access, then why is that the standard right now? Why are ISPs, on the whole, not bankrupt and pulling the plugs? Because they already make bank and know that, now that everyone is hooked, they can start jacking up the prices if they could just figure out the right route to do so.

    I say no – enforce neutrality and don’t support metered ISPs. They should be allowed to try it, but the market should be allowed to stomp them for it.

  22. ifriit says:

    I’m not sure Tweney is really aware of how the US telecom markets work if he thinks you have a “high level of competitive choice” in the broadband arena, at least in terms of physical lines. Sure, you might have “all sorts of options” for a provider, except underneath it all you’ve actually got just one choice: the owner of your local loops. Speakeasy, Covad, Astound, etc.–if it’s DSL, they’re either the local monopoly owner, or they’re renting from the local monopoly owner, and when they raise their prices, they force all the others up too. Not to mention that they sabotage their renters as much as legally possible, since they’d really prefer not to be leasing to them at all. Ultimately, with physical lines, you have two choices, max: the local cable provider or the local DSL provider.

  23. MB says:

    Hook, line, and sinker, it seems.

    This argument is on par with Jack Valenti’s calling the VCR the Boston Stranger. Patently absurd.

  24. wrybread says:

    Personally I think this is just another example of how the free market has failed to provide a decent internet infrastructure in the U.S. By pretty much every measure the U.S. lags waaay behind the rest of the “developed” world (this one for example), and if retarded measures like metered internet go into effect it’ll just get worse.

    We really can’t compete globally if we have a shitty internet backbone. Its like expecting a country with dirt roads to build a fast car. Its time for government to intervene and build us some decent fiber optic networks. Even Adam Smith said that if the free market can’t provide something important, government needs to do it. And if its true that the telcoms can’t make money delivering internet (which I *highly* doubt is the case), then get them out of the picture and make it a public resource.

    Not that Fox News et. al. would ever let that happen, but one can dream.

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