61 Comments

Summary:

We’ve talked before that metered access is a boneheaded idea that is bad for innovation, bad for Microsoft and Google, and ultimately bad for you. Until today, the idea seemed like an eventuality, not an immediate reality. But then NBC and TonicTV launched a new service […]

We’ve talked before that metered access is a boneheaded idea that is bad for innovation, bad for Microsoft and Google, and ultimately bad for you. Until today, the idea seemed like an eventuality, not an immediate reality. But then NBC and TonicTV launched a new service that lets you download video from the Olympics and watch it offline. Right next to the installation instructions was this “important”note:

That’s the first warning I’ve seen about a particular service not being recommended for folks with metered broadband access. But the real bummer? That is just a taste of things to come — especially if you’re a fan of video services like Hulu.

We’re not even talking P2P throttling, just straight video consumption. In fact, P2P isn’t even a huge deal for networks anymore (but not because of that slap on the wrist the FCC gave Comcast). DSLReports writes that as of June “AT&T traffic was about 1/3 Web (non video/audio streams), 1/3 Web video/audio streams, and 1/5 P2P.” Those audio and video streams — that’s Hulu and YouTube. And as they provide more content at higher quality, those streams are only going to increase.

If metered access becomes standard, there will come a day when you spend less time watching videos, and more time counting the number of videos you watched to avoid going over your cap.

You have been warned.

  1. “If metered access becomes standard, there will come a day when you spend less time watching videos, and more time counting the number of videos you watched to avoid going over your cap.”

    You mean like how we all used to count the minutes we used on our cell phones because we had like 100 daytime minutes, but 1000 night & weekend minutes, or worse pay-per-minute like I had in high school? (This was a 2nd phone, before “family plans” existed, because my mother didn’t trust my car.)

    -Adam

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  2. Well part of the reason why cell phone minutes are limited and why they like contracts so much is because they use the “guaranteed” funds to build out the network and upgrade the systems (3/4G doesn’t just spring up on its own). If you notice now, the providers are starting to offer unlimited plans.

    Broadband access is going in reverse. The buildout happened back in the ’90s, but that’s when you saw the lowest rates. Which is why the providers claim they need metered internet now, since they apparently didn’t anticipate people ever actually using what they paid for. The real reason, as mentioned on this site before, is that the telcos and cablecos want so desperately to keep you on *their* entertainment model (i.e. $50/mo+commercials+1/3 channels being shopping channels) that they’ve got to find a way to either a) make up the difference in lost customers, or b) keep customers from jumping ship to the web in the first place.

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  3. You mean like it has been in Australia since the days of dial-up? You won’t like it. You will get used to it. Just like we have to.

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  4. Most Aussies have Metered Broadband with with hard caps and throttling yet they are the biggest downloaders of Movies and TV per capita because of the PAL/Australasia Region Distribution Window delay they have to put up with , which can be longer than 5 Months .

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  5. Matt, as far as I am aware, *all* Aussies have metered bandwidth and throttling, don’t they?

    While I was down under at Christmas and last year, my fiancee and I couldn’t find one consumer ISP which offered unlimited internet.

    I think this is a *HUGE* problem for internet innovation in Australia. Especially as the rest of the world embraces high(er)-bandwidth video content on the web.

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  6. After vacationing in South Africa for four weeks where you really can’t find anything but metered Internet, I definitely agree that metered Internet sucks.

    I’ve got 800 photos that about 1.5 gigabytes in size. I’d never get them uploaded to my Flickr account. I probably wouldn’t have a Flickr account if I lived there.

    I’ll just mention the 8 hours of video that I took, about 20 gigabytes.

    We truly seem to be going backwards over Internet connectivity. There always seems to be a problem, from the phone companies screaming about all the people that had 2nd lines and were using them 24 HOURS PER DAY! The ISPs making sure that you got kicked off after 8 hours, leading to programs that would automatically redial you back in whenever there was a disconnect. The problems of downloading too much from FTP and Usenet to today’s P2P and video streaming.

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  7. Those that use more bandwidth, should pay more. What’s the problem with that?

    Why should someone that does not download video, music or books often, be forced to pay for bandwidth they don’t use? Why are you against those people that don’t use a ton of bandwidth paying less for their high-speed broadband Internet connection?

    Why can’t not a tiered system such as:

    Package 1 (least expensive): X amount of bandwidth per month. Good for those that do not download music or video, but want high-speed access to web sites, check email, upload a few photos per month or IM.

    Package 2 (mid level): X amount of bandwidth per month. Good for those that download one or two videos per month, upload 10-20 photos and download around 30 songs.

    And so on…

    What’s so wrong with not paying for bandwidth you don’t use? It’s like Cable TV: why should I have to pay for channels I don’t watch? Why should I have to pay for bandwidth I don’t use?

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  8. “Those that use more bandwidth, should pay more. What’s the problem with that?”

    Do cable TV users pay based on how much TV they watch? Not the channels, how many minutes in a day. Of course not, because customers would never tolerate limits on TV. Customers no longer tolerate limits on local telephone use, either, and the principle of “pay by use” is the same.

    I don’t know about other providers by my DSL already provides a tiered service, including tiers the company (ATT) specifically for video download. Here I am being encouraged to download video, only to have the company then come along and say, “Oops, we really didn’t mean you should use that increased speed to actually, you know, download movies. Pay up!”

    Should I as a site developer now worry about how big my photos are? How much video I embed into pages, because I might inadvertently push a friend’s bandwidth over some insane 5GB limit.

    How about all those ads at sites? They take bandwidth. Should we be forced to pay for such trash? I’m sorry GigaOM folks: you must remove all ads. Oh, you need them to pay salaries? Tough. The ISPs have spoken.

    The Australian gentlemen mentioned about caps in Australia. Yes, but I bet there is nothing even close to 5GB, which is what is bandied about in this country. You can’t even read weblogs for 5GB a month.

    We are finally getting to the point where we can begin to challenge the stranglehold the cable and dish companies have on video; to actually have a choice in this country, only to have it blocked, because all of a sudden, the ISPs (who happen to provide these paid services) have suddenly decided such services put an unnecessary burden on their systems. The same systems that have not been upgraded since they were first installed, years, maybe even decades ago.

    Those who think that ridiculously low caps are justified because “not everyone is using the bandwidth” forgets that innovation is not customer-demand driven in this country. Didn’t Henry Ford once say something about if you asked the customer what they wanted, they would have asked for a faster horse?

    Another story on Techmeme at the moment is, ironically enough, about the Dr. Horrible webisode shows, and how the web provides a new and potentially fertile area where we can expand on what we can do with video. Not just we, the amateur we, on YouTube; the professionals, also, such as Josh Whedon, who no longer have to be blessed by some network in order to try out their “crazy” ideas. Crazy ideas, which give us something more than Most Talented Dog in America, or Dancing with Stars. The networks feed us pap. Our only hope for true creativity now, is on the web.

    We cannot innovate on the internet, though, if the most critical component of that innovation is stoppered even before we start.

    You all might want to consider some of this before you become self-appointed guardians of the interests of the corporations who would have no compunction about running their profit-obsessed steamrollers right over your butts.

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  9. Jonathan Walls Sunday, August 3, 2008

    Not to agree or disagree, but to point out the various faulty arguments:

    “Do cable TV users pay based on how much TV they watch? Not the channels, how many minutes in a day.”
    – The internet is not analogous. For instance, P2P is mostly not people watching the movie as a live stream.

    “Customers no longer tolerate limits on local telephone use”
    – Actually, they do in countries other than the US. Besides, it is just naive to suggest the companies are proposing a system that no-one will tolerate because then they wouldn’t get paid. The reason local calls are free is because (surprise!) under the overall pricing scheme they do charge for calls. Free local calls, your first 10GB free – there’s no substantial difference here.

    “Here I am being encouraged to download video, only to have the company then come along and say…”
    – A company encourages behaviour which increases its profits? Shocking! Likewise, changes in terms and conditions and failure to anticipate the consequences of ones actions are a necessary fact of life. If the change is a bad one then it is a bad one regardless, not because of how you felt about it. But the fact it is negative to your self-interest does not make it a bad change.

    “Should I as a site developer now worry about how big my photos are?”
    – Site developers must have be capable of understanding and working to constraints. If you are capable of inadvertently going over a 5GB download, you are too incompetent to develop sites.

    “How about all those ads at sites? They take bandwidth. Should we be forced to pay for such trash?”
    – Let’s go back to your TV analogy, which is now relevant because we are at the PC looking at it. Advertising is part of how the system works. You are not “forced to watch it”, but the various products you enjoy do have advertising as part of the business model. Don’t like it? Don’t watch that program or visit that site, close your eyes, use AdBlock, whatever.

    “the ISPs .. have suddenly decided such services put an unnecessary burden on their systems. The same systems that have not been upgraded since they were first installed, years, maybe even decades ago.”
    – So you’re saying money should be invested, but not paid for by the customer that benefits? Or maybe that companies shouldn’t be allowed to make mistakes? Or that when an industry makes a mistake, no part of the costs to correct that mistake should be passed on to the customer who benefits? Whatever the point intended, it is most likely as nonsensical as those interpretations.

    “We cannot innovate on the internet, though, if the most critical component of that innovation is stoppered even before we start.”
    – The internet was born through metered connections. So what is the supporting evidence to your contradictory assertion? Why is differentiating between heavy and light use “stoppering”, which implies an absolute?

    “You all might want to consider some of this before you become self-appointed guardians of the interests of the corporations”
    – Piss off, you self-righteous twat. It’s the same shitty standard of logic (of the opposite flavor) that drives the right-wing corporate mentality. Pointing out that your argument sucks is not defending the corporation. If you can’t think straight, don’t be having a go at those of us who can.

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  10. Om, you needn’t warn those of us who understood the implications from the get-go. But all you’re doing is focusing on a provincial item — online video. This issue is HUGE because it will affect our NATIONAL COMPETITIVENESS. How are kids here going to compete with their Chinese counterparts if China Internet access runs like free tap water? Metered Net access puts us all back in the days of rotary telephones and operator-assisted long-distance calls. That is NOT the direction we should be taking, dammit!

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  11. interesting… and humorous at the same time!!!

    you guys complaining about capping bandwidth at Xbytes are probably the same ones saying that it’s cool/ok to download music whenever/wherever you want to..

    look, tv allows the distribution of the signal to be picked up by any set with the components to receive the signal. cable tv, kicked this up a notch, and introduced cost per user.

    distributing anything over the internet costs on a per user basis. just so happens that straight text/small images is not that costly/bad, in terms of the strain it puts on the network.

    you, as a consumer have a couple of choices. you can choose not to use higher bandwidth services; you can choose to use the services, and pay your isp; you can choose to get really pissed, raise funds, and start you own isp; you can act like spoiled kids, and whine…

    if you’re running a legal business, i can’t force you to change because i don’t like the way your business decisions will cost me more $$$ for a service that’s a “want”, not a “need”…

    if you’re really a great entrepreneur, you figure out how to get your customers to pay for your product… download my video, actually look at my ads, and use the sponsors products in a manner that i and the sponsor can track, and we’ll rebate you some cash to defray the cost of the videos you watch… oh, that’s right… you really don’t want to pay for what you get/use…

    welcome to the world called capitalism!!

    it’s a bitch, ain’t it!

    peace

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  12. “Piss off, you self-righteous twat. It’s the same shitty standard of logic (of the opposite flavor) that drives the right-wing corporate mentality. Pointing out that your argument sucks is not defending the corporation. If you can’t think straight, don’t be having a go at those of us who can.”

    And setting up your own straw man arguments, only to knock them down does not equate to proving that our arguments “suck” as you so eloquently put it.

    Whether it is your intention or not, you are defending the corporate interests. Sure you can do it because it gives you joy to “blow holes” in what you feel is faulty logic, but you are also, indirectly or directly, serving corporate interest.

    As for your arguments, a) we’re not talking about other countries in this particular post, and b) name me one pipe with unlimited service that has successfully reverted back to a limited service? As for the cable “not being the same”, I’m sure you saying so is supposed to make it so, but I hope you’ll forgive the rest of us for now bowing down to your supposed wisdom.

    Finally, “Piss off you self-rightous twit” — my, what a wonderful debating style you have. Learned that at Harvard, did you?

    sam, “you guys complaining about capping bandwidth at Xbytes are probably the same ones saying that it’s cool/ok to download music whenever/wherever you want to..”

    I’m one of the strongest pro-copyright webloggers in this environment. I’ve even defended the RIAA on occasion. Do not assume that the only reason we want bandwidth is that we want more pipe for our illegal downloads. Many of us are concerned about bandwidth because not only are the ISPs yakking about caps, the caps most are proposing are obscenely low, even by other country standards.

    Listen to some new uses of bandwidth that could be impacted by caps:

    Several schools here in Missouri are providing extended course work from big cities to the smaller communities, so kids have access to a richer curriculum.

    RIA applications are dependent on online access, and the ability to also snapshot work and store on the computer, all of which can take bandwidth.

    Not everyone has access to cable, Dish, uverse, or the like, but can still get access to television and news shows thanks to Hulu, CBS, ABC, Joost, and so on. These shows really take bandwidth.

    Netflix is now offering movie streaming, not only via the Roku box, but now as part of XBox and upcoming blu-ray players.

    Richer media experiences are now online, from the Missouri Botanical Gardens scanned copies of extremely rare botanical books, to the Library of Congress’s uploading of rare and important photographs. Many of these images are larger in order to provide enough detail, which, of course, takes bandwidth.

    Even if you don’t have access to a TV, you can view important news videos online, in addition to legally having access to full episodes of news programs, and so on.

    Dr. Horrible is not the first and won’t be the last innovative video experience online, but shows like these take considerable bandwidth.

    We watched vehicles land on Mars, followed debates by presidential candidates, viewed extraordinary images from the Hubble space telescope, and learned more about each other, including our homes.

    Cap broadband at 5GB a month and we return to the web of 1994. Do you all really want to return to the Web of 1994?

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  13. Chris:

    Telcos may be passively in favor of the FCC decision against Comcast because it can be used as an excuse to go to metered pricing. “how else can we stop the bandwidth hogs if we can’t discriminate?”

    We have good examples from around the world that the market will sort out both net neutrality and metered vs, unmetered pricing given a chance to operate. But here in the US we have a cableco-telco duopoly in most regions, both with a desperate need to stop free or cheap content from being easy to obtain.

    more at http://blog.tomevslin.com/2008/08/net-neutrality.html

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  14. I have to laugh: there’s always one sheep who’ll speak up to defend the herders. They bleat right on queue, congenitally unable to perceive the old divide-and-conquer ploy at work. And able to ignore the central point of the news item on which we are commenting: that metered access is going to interfere not just with illegal downloads, but also legal ones; and not just with “heavy” users, but with average customers who want to do something as innocuous as watching the Olympics.

    Of course, it’s generally not logic, or altruism that prompts their obtuse comments. It’s the smug satisfaction of knowing they download about 10GB in a heavy month, and are about to get a huge break at someone else’s expense. It’s amazing how some people will give up their rights for a pittance. Guess what: today, the ‘heavy’ users. Tomorrow: YOU. Rural users. Or users with more than one computer. Or users with a vowel in their name. Or – YES – users who download less than 10GB per month…

    Yes. Because the point of metering is NOT to make heavy users to pay – but to establish the principle that ISPs can set the value of every byte. That gives them (lets them retain) total control over content, in both quantity and variety. Not convinced? Then ask yourself why there’s never an “unlimited” plan. Should be a huge money-maker, right? But it’s NOT on the table because this is NOT about the money. It’s about restricting types of usage.

    Chris Anderson (of Wired and The Long Tail) uses Internet bandwidth as an example of a commodity that’s very close to being “too cheap to meter.” In fact, it already is that cheap in many countries. The wiring is largely in place (with public subsidy!), and the cost of switching is on a plummeting Moore’s Law curve. Someone needs to tell North American Internet providers. Oh, wait… it seems they’re the exact same companies that currently enjoy vast revenues from distribution of conventional TV. Doesn’t it seem just a bit too convenient that they (in happy unison) should find the new commoditized IPTV model to be technically impossible?

    No, I guess not. Oh, well… just go back to sleep and I’m sure the future will take care of itself.

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  15. Excellent argument, fung0.

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  16. To Keith, Jonathan, Sam and the rest of the naive folks out there. To explain in no uncertain terms – Metered broadband is not about bandwidth hogs causing problems.

    Metered broadband is primarily about one thing – profits. Secondary it is about putting what competitors they have out of business – Vonage, Skype, Netflix streaming movies, networks making TV shows available online (and thereby bypassing the cable companies monoploy). So in order for metered broadband to make more money they have to set the limits low enough so that AVERAGE users will go over and pay the additional fees. They also have to set the limits low enough so that it is next to impossible to use Vonage, Skype, Netflix, etc. without going over your limit. Then they will come out with “promotions” where if you sign up for their VOIP phone service it won’t count towards your limit. And they will set up deals with Netflix, the networks, etc. for them to pay extra to the duoploies for distribution so that their products don’t count towards your limit.

    One of the commenters talked about cable TV and how it is a notch above network TV. You are probably too young to remember but they initially got people to pay for TV (vs free TV) by making cable TV commercial free – the was their reason for people to pay. Then after a period of time when people no longer had their own TV antanna’s/towers (My father had a business in the ’60’s putting up antanna’s / towers for people – grin) they pulled the switcheroo – now 60% of programming time is commercials. They got people to pay to build their infrastructure and once they had the market cornered they screwed them.

    One commenter mentioned cell phones – 4 or 5 years ago, when there was more competition in cell phones, I could get 1000 anytime minutes for $40 per month – now $40 per month will only buy you 450 minutes per month. Why? Because most of the competition is gone.

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  17. Jonathan Green Sunday, August 3, 2008

    Wow. First Om, then Liz, now Chris. You worked in MSM before, right? If this is supposed to be a tabloid-like campaign, you better be in alignment with a clear majority of your audience — which in the four pieces I read was never the case.

    Seriously: tell us some numbers about the growth of the data volume on the US Internets, separated by backbone and last mile. How far are we from saturation? What is the investment going to be about: laying fiber as in 99 and with FIOS or routers/etc? While fiber may be a one-time cost (in the last mile, at least), everything else is proportional to data volume. So, if the fibers and routers from 99 are now finally getting used up, doesn’t it make sense to make the price for end users reflect actual cost?

    If so, it’s absolutely correct to introduce metering or limited data volume packages. I’m now aware of flat rates for electrical power, water, gas… The flat rate for TV has to do with the fact that TV data volume in the local loops is flat: the cables must provide a frequency “space” for every channel you could watch, regardless of whether you do that or not. That is not the case for Internet data packets.

    Why should the telcos pay for GOOG and MSFT, who are already insanely profitable?

    So: show us some figures about growth and necessary investment.
    You’re pretty much the only tech blog with real journalists. Now investigate, rather than trying in vain to create a TechCrunch-like mob response here.

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  18. That last mile, so fraught! When I asked the data head end guy out here why the subscriber up/down speeds were asym, he said, People are asym”

    6 down, 1 up. Crazy, especially when the segments at the zone level can dynamically allocate the backhaul to take advantage of idle or low usage at the subscriber switch side.

    It’s all made up, this argument of scarcity. They have plenty of idle bandwidth in the terrestrial plants (cable), and they are just trying to set up the squeeze. DSL is a bit different, but not terribly so.

    There will be a new portfolio of wireless broadband ventures that will put the whammy on the incumbents when and if they start metering. Then we get our caps lifted.

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  19. Why haven’t Microsoft – Google gotten on the war wagon against metered broadband?

    With regards to Google here is my theory: The vast majority of Google’s profits come from pay-per-click search result based TEXT ads. Which take up very little bandwidth. It is only Google’s competitors who mostly offer graphical display ads (such as the ones here on GigaOM) that will be hurt. Yes, Google has other offerings that would be hurt but they have the money (especially with an even bigger corner on the advertising market that metered broadband would afford) to pay the duopolies for non-metered content.

    With regards to Microsoft – the VAST majority of their profits come from desktop software. Unlimited broadband puts a hurt on these profits by allowing online applications to compete with their offerings. Metered broadband would be a boon to Microsoft. And once again Microsoft has the money to pay for non-metered content should they want to offer such.

    In both cases metered broadband help to further entrench their respective monopolies.

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  20. hi guys.. (fung0/shelly/greg…)

    i’m a guy who grew up watching a total of 3 stations in the city where i spent my childhood.. black/white mind you.. so i’m probably older than most here. and yeah, i fully recognize that there are plenty of legitimate uses for higher bandwidth/caps.. and i’m fully aware that the market/tech will take care of it…

    this is the role of gov’t.. to be able to (either at the local/state/federal) level, to make sure competition can grow, not to enforce it, but to make sure that a new entrant into the market has a chance.

    now, having said this, i’m pretty sure that most people don’t want to understand that the ability to get the content from online sites is not a free for all.. there is a cost. so, the issue boils down to who’s willing to pay the cost..

    there’s nothing to stop anybody on here, from doing the initial research, and putting together a biz plan for funding… if there’s plenty of unused/excess capacity just sitting around, waiting to be turned on.. then i’m sure there are plenty of VCs who’d be willing to fund “unlimited” access if it makes sense..

    but then, given that i have personally worked in the cdn/internet biz on a few occasions, i’m also sure that there’s not this hidden amount of bandwidth!!! this isn’t to say that there’s not bandwotdh that can’t be turned on, just that it’s already owned by someone, and that the biz who owns the pipes, has their own ideas as to what to do with the pipes…

    look, it’s pretty simple. every time you access the ‘net from your home, you’re paying someone for the access. you can decide to quit anytime you choose.. if enough people quit, the isp will take notice..

    you can also start/create a movement where you encourage businesses to contribute to a pool of cash to alert users of this action.. convince web companies to put the warnings/msgs on their sites… motivate enough people, and get enough people to take notice, and you can get things changed… i’m willing to bet that few will take this mantle, and do anything more than write a few posts to a few blogs..

    in most cases, actions matter a lot more than words..

    peace..

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  21. sam, “look, it’s pretty simple. every time you access the ‘net from your home, you’re paying someone for the access. you can decide to quit anytime you choose.. if enough people quit, the isp will take notice..”

    Sam, I have exactly three broadband options from my home: one, cable, will cap, that’s a given; two, DSL, are talking about caps.

    This is not the same as running down to the mall, and having my pick of a dozen stores. When you have the option of capped broadband, or no internet, where is the choice?

    This is no different than the cellphone companies and their long term contracts, and the credit card companies and their hidden binding mandatory arbitration clauses–you don’t have a choice. Either you use whatever you’re given, or you don’t use it at all. And frankly, you can’t by without credit cards in our society (try traveling and pay by cash only), and many people are dependent on cellphones. Same as many people are dependent on the internet, for their jobs, and just to stay in touch with friends and family.

    There’s a belief that capitalism is in action, because after all, as you say, if you don’t like it, don’t use it. “Let the market send the message”, or something like that.

    But there are no alternatives.

    You’ve heard from several people in this comment thread that the “scarcity” and the “bandwidth problems” most likely don’t exist, or are no where near the problem they’re made out to be. You’ve also heard several people mention how odd, the same ones wanting to cap bandwidth are the same ones who don’t want competition from the new online video options.

    If I read you correctly, do you see us working around the problem by pooling our pennies and heck, just start up an ISP all our own?
    Is that how we deal with near-monopolistic companies colluding to put the squeeze on their customers?

    Especially in light of the recent news in Canada, about a small company doing just that, and getting throttled by the backbone controlling company because the smaller company actually offered no-cap broadband?

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  22. Well I agree with Sam this time on a couple of points.

    But before you waste your time firing off letters to your federal representatives please understand that getting something done on a federal level will not happen. The corps own Washington. Short of mass demonstrations in the streets of Washington DC that is. Which isn’t going to happen.

    Next would be getting the major player sites that stand to lose by metered broadband to take up the fight – Facebook, Myspace, Flickr, Netflix, P2P, BLOGS, etc. – The ones with huge traffic that can make a difference. And that’s assuming that the duopolies haven’t been smart enough to cut deals with these sites already. A deal with the duoploies would be smart for these sites as it would eliminate most all competition. And smart for the duoploies to keep them from using their massive user base against them.

    So this leaves us with the one real possiblity – action on a local level. Getting municipalities to build their own networks (most likely wireless as fiber is too expensive) and putting their own nodes on the internet backbone. The ISP’s don’t own the internet and aren’t the only ones with nodes on the backbone. There have been a couple of small towns that have/are trying this and the ISP’s are suing them. Which tells us that it is the right way to go.

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  23. So now, if I want to backup my client’s accounts from my servers to my home backup tower, it’ll come at the premium that I will have to pass on to my clients, who, in turn, will whine and complain.

    Given that I do full back up every day, it accounts for around 4GB daily; it’s going to get around 120GB/month just for that. So what’s going to happen is that I’ll rent another server for backup only (going to cost me less then latte a day) and cancel my “boost” account that gives me extra bandwidth cap. Therefore my ISP will loose money right there, instead of making them.

    Of course, I am not the average user, I don’t use Myspace and Facebook, I rarely watch videos off YouTube. If not for backups, I can switch off the home cable completely and use my cell phone tethering with unlimited data plan over 3G. There goes more money loss for my ISP. Since the plan costs only $50/month, what’s the point of metering myself if I can use unmetered for a fraction of the cost?

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  24. Chris,

    Nice catch. I saw some ominous signs in Microsoft’s “Mommy, why is there a server in the house” book at CES this year (writeup here: http://www.bitcurrent.com/ces-day-one-find-the-irony/)

    In the foreleaf of that book, it says:

    “Use of Windows Home Server’s remote access features may require additional services from your broadband provider, such as access to certain “ports” that some providers may block for some customers on some service plans.”

    It’s not just pay-for-rate (“metered”) but also differentiated (some ports blocked) that is behind the slippery slope of net neutrality.

    Heh.

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  25. [...] Increase in Internet Bandwith Use Leads to Possibility of “Metered” Broadband – I doubt this will happen. American consumers just won’t stand for this. The interesting piece from this article is ” DSLReports writes that as of June “AT&T traffic was about 1/3 Web (non video/audio streams), 1/3 Web video/audio streams, and 1/5 P2P.” Where video/audio streams are Hulu and YouTube. Wow! [...]

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  26. allister…

    not sure where you live.. but in every place i’ve ever been, the isp (comcast/att/sbc/roadrunner/…) have all stated, the home service is for home use, and that running a server of any kind is construed to be business, and you need to upgrade to a business account… which of course costs a great deal more…

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  27. Typical Americans.. whining like babies when you actually have to start paying for something like petrol or bandwidth. The reason you have had free bandwidth for so long is that the rest of the world was paying for it.

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  28. I think some are mistakenly thinking this is limited to P2P file transfer traffic. This impacts all of your internet traffic. I’m a fan of Netflix Player and Hulu. These are direct competitors to the Cable TV industry, and as a broadband provider they want to limit this competition. Now that the Telephone DSL providers are also getting into providing TV they also are going to be part of the competition and cannot provide a neutral broadband alternative.

    I also have a small business where I have to transfer files to and from servers with my suppliers. So not only is it going to impact internet innovation, it will impact the day-to-day operations of many companies.

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  29. Daniel, “The reason you have had free bandwidth for so long is that the rest of the world was paying for it.”

    Uh, no.

    Just noticed that the standard image for commenters is a little man. Don’t women comment at GigaOM?

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  30. Metered Internet is a good idea as long as the Government regulates the maximum price per gygabyte and that the government also measures that bandwidth quality is good and not throttled in any way.

    Price per GB maximum should be below $0.10.

    Maximum price for the service fee could also be set by the government for example $5 per month at the maximum for an connection with an included premium bandwidth capacity of 50GB.

    If you rent a modem, a router or some other equipment, the rental fee would be put on top of the bandwidth fee. Thus price for ADSL, Cable, WiFi and other such technologies should be known to every customer, thus there can be competition on the hardware to be used.

    This would mean that anyone using less then 50GB per month would not have to pay more then $5 per month for the bandwidth and they’d have to buy the modem or router but they could pay over several times over several months for that hardware.

    People who use more then 50GB per month would pay something like a maximum of $0.10 per GB. In exchange everyone is guaranteed to get top quality bandwidth connection to all the backbones that the government would decide have got to have top notch premium bandwidth towards.

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  31. [...] Warning Sign: Metered Broadband Already a Hassle [...]

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  32. [...] just a taste of what’s to come for online video fans if metered access becomes the standard. Head over to GigaOM to read why paying for your Internet as you go is bad for innovation, bad for big companies like [...]

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  33. Metered broadband as horrifying as it sounds. My country ISP may practice this method any soon as theres only one ISP dominate the market, tmNET (we call it tmNUT).

    I believe that they dominate the market because our government is so selfish to not to make license available to new ISP company as tmNUT is half-government company (they afraid that once they make the license available, the new company will beat them and thats mean, NOR PROFIT for tmNUT and gonv)

    Politics in practice, u may say. :P

    Just pray that there would be no metered bandwith here in my country.

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  34. [...] Metered access gets a turn in the barrel [...]

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  35. [...] Giga Om: Warning Sign: Metered Broadband Already a Hassle [...]

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  36. What?

    $5 for 50GB? You’re dreaming.

    In Australia (Where, yes, 500MB and 1GB plans are very real) it costs me a good $70AUD per month (That would be very close to $70US) for 12 Gigs of “onpeak” (Noon -> Midnight) and 24Gig “Offpeak” (Midnight -> Noon). So all in all, I get 36Gigs if I play my cards right. If I go over the 12Gigs on-peak? Well that’s it, end of the game – I get limited to 28.8kbps for the rest of the month.

    A good many people in the world are suffering this already – and we’ve tried to get rid of it. But, surprise surprise, companies are after profit and so, who cares about the consumer? They need internet and they can charge us whatever they like.

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  37. Here in New Zealand, we have metered broadband. It’s not so bad. The cost of DSL is equivalent to about 4x Big Mac combo (burger, fries, drink), and about 1 can of coke per GB. If you download 50GB of porn, you’re paying about $50NZ. Most people here get less than 5GB. It reallly isn’t a big deal for most people.

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  38. re my previous message, if you download 50GB of porn, you pay about $30+50=$80 per month. Big Mac combo = $6.80, coke can = 1.30 from vending machine.

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  39. I have my original contract which clearly says UNLIMITED. They try to meter me and they WILL have a lawsuit on thier grubby little hands.

    JT
    http://www.FireMe.To/udi

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  40. The trouble is that in other countries there is a market. In the uk in any moderately civilized area (i.e. not 20 miles from the nearest exchange) I would have had the choice of 20-30 different broadband companies, and inside london at least 60 different companies. Each would offer me different deals and so when unreasonable metering was suggested, it lasted all of a few months because most people left for the alternative.

    Here in upstate new york, i get the choice between cable and dsl, (no fios, its not got over the river yet) and there is no other option. You could also argue that since dsl in this country is so slow its not a realistic option…

    These companies have sat back and done no work on their network beyond basic maintenance and raked in the profits, because they have known that only a few users would actually make use of the bandwidth offered, ignoring the many service revolutions. Now they are whining because more and more people are using what the internet has to offer and there isn’t the capacity without much more growth.

    If there has to be some form of metering then make it reasonable.

    For me, a 300GB cap would mean i would very rarely go over my limit, and if there is a small charge per gigabyte over, this would seem somewhat reasonable.

    That said, there should be a reasonable option for those who don’t want a cap, there are people who for whatever reason use that much bandwidth per month.

    Demand is going to grow, i use a lot of things on the internet, but more demand is coming, including many high bandwidth applications, and as that happens isps need to be ahead of the curve in meeting that demand rather than a year behind it.

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  41. Where I come from (Wisconsin), my Internet provider is also my Cable provider. They DO NOT want people getting video from anywhere other than the most expensive option of their cable service, nor do they want people chatting away on Skype or Vonage; they want them using their home phone service.

    Watch as, when metered bandwidth moves away from Texas, Time Warner Digital Phone doesn’t count against my Road Runner transfer cap.

    Illegal? Yes. Is the conservative McCain military-industrial complex ever going to help us ordinary people? HAHAHHAHAHAHHAHAHAHAHAHHAHAH NO, never. Corporations first.

    The FCC is a joke. This is going to happen and nobody’s going to stop it. And it’s going to crush the non-text-only Internet.

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  42. Warning Sign: Metered Broadband Already a Hassle | nerdd.net…

    \r\nWe\’ve talked before that metered access is a boneheaded idea that is bad for innovation, bad fo…

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  43. [...] Web users download video from the Beijing Olympics and watch it offline. But as first noted by GigaOM, there’s a note attached to the installation instructions. “This software is not [...]

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  44. Considering that this effects video on demand and streaming video internet services so severely, and that many ISP’s are also cable providers, it’ some real of anti-competition douchbaggery.

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  45. Daniel, “The reason you have had free bandwidth for so long is that the rest of the world was paying for it.”

    Priceless!, but so true. As an Aussie ~$70US for 60GB then its 64k, its the undersea cable thats costs the money really as more data is offshore(from the US)you have to expect its going to start costing more.
    The US has peering agreements ect ect but for any traffic abroad theres only one fast way to deliver it and that costs a bunch to maintain. Cables get broken all the time and the initial cost of deployment is massive. There is only one way it can remain affordable to deliver the bandwidth and that is for the providers investing in this rather then phat CEO paychecks. If they are generating the bandwidth they(Google, microshaft, Yahoo)should be assisting in the infrastructure deployment to help users gain access else USB drives are only going to get more popular and the advertising model WILL fail!.

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  46. Sounds to me like you guys in the US have a far bigger problem – the lack of ISP options. How the hell does the “capital of capitalism” end up in a situation like that? Aren’t you supposed to have aggressive marketplace forces so competitors have to strive for your $$$s?

    WTF is going on over there?

    Mind you, here in OZ we have metered already, but I get about 70GB (a mix of on and off peak) for $80 so maybe we’re not ones to talk.

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  47. graphicartist2k5 Monday, August 4, 2008

    Are they gonna start having “broadband meter maids” now? Give me a freaking break. It’s the INTERNET. When the hell are they gonna figure out that they can’t control what anyone does online, no matter WHAT they try to do about it? I’m seriously waiting for a judge to look at these morons and say, “OMG, WTF! GTFO!!!!” That would be hilarious.

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  48. but hey guys…

    this is an opportunity for multiple biz apps…

    create the next generation adblock+ app that not only allows the user to block ads (which saves cap/bandwidth), but it also calculates the actual amount of data/bytes that these ads consume.. massage the data.. make the data available to isps/businesses.. offer this app up to the isp for them to offer to their end users on a subscription basis.. let them roll the price into the monthly rates…

    think biz opportunity here guys!!

    peace..

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  49. “Sounds to me like you guys in the US have a far bigger problem – the lack of ISP options. How the hell does the “capital of capitalism” end up in a situation like that? Aren’t you supposed to have aggressive marketplace forces so competitors have to strive for your $$$s?”

    Capitalism in the US now consists of a few big companies partitioning the country between them, and getting government buy-in to legislate against any newcomers. Not only that, but they can usually con the government into paying for most of their infrastructure, too.

    It’s not capitalism, it’s corporatalism.

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  50. While I appreciate people being reminded and reintroduced about this reality, the fact is the Olympics is obviously a global event. Many countries outside the United States meter bandwidth (Canada, Australia…) Their service may not be very practical in places like that.

    It may yet be an eventual reality, but come on people, one single warning and suddenly the world comes crashing down around us?

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  51. “Mr_Brown said:
    Daniel, “The reason you have had free bandwidth for so long is that the rest of the world was paying for it.”

    Priceless!, but so true. As an Aussie ~$70US for 60GB then its 64k, its the undersea cable thats costs the money really as more data is offshore(from the US)you have to expect its going to start costing more.
    The US has peering agreements ect ect but for any traffic abroad theres only one fast way to deliver it and that costs a bunch to maintain. Cables get broken all the time and the initial cost of deployment is massive. There is only one way it can remain affordable to deliver the bandwidth and that is for the providers investing in this rather then phat CEO paychecks. If they are generating the bandwidth they(Google, microshaft, Yahoo)should be assisting in the infrastructure deployment to help users gain access else USB drives are only going to get more popular and the advertising model WILL fail!.”
    ——————————————————
    First:
    What the heck does USB have to do with ISP and internet access. Last time I checked that was a method on connecting devices to a PC. Outside of connectiong your modem to the pc via USB you still have to pay for the access from your modem to the net(WAN).
    Second: Just becuase you would prefer to roll over and let your ISP’s take advantage of you doesn’t make it right. The ISP’s complain about infrastructure costing so much so before they build they get Govt. subsidies to pay for most of it. Then they pay their costs off for infrastructure and running cost and begin to build a profit, once it gets to the point that they have to expand they either buy another ISP we helped pay to startup. They know they cannot get the subsidies they did before so they turn predatory with their charges. Some people say it’s only fair they pass the cost off to their subscribers, but they do not do this. They change the pricing and reap even higher profits without adding infrastructure. Then when they build the infrastucture they advertise it as a totally new service and jack the price up yet again. This is akin to paying millions of dollars in taxes to build Highway’s and Interstates then waking up one day to find them all privatized into tolls. Thats fine that the toll pays for the cost of laying the highway but when the taxes paid the emminent domain prices and higher for property on which it is laid, then the drivers have a right to be upset.

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  52. The idea of metered bandwidth makes me really nervous. It makes it seem like over time the internet will be used like TV and radio is currently used. That would ruin the internet and all the amazing innovations that came with it. I am part of a campaign to switch over to the first Telco to take the Net Neutrality pledge. If you’re interested check it out here: http://www.thepoint.com/campaigns/first-telecom-to-take-the-net-neutrality-pledge-wins-our-business

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  53. That telco will win lots of business actually. The problem is with the incentive. The corporations like the way things are and only seeing a huge amount of possible revenues will make them change something

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  54. “but hey guys…

    this is an opportunity for multiple biz apps…”

    What do you mean by multiple biz apps?

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  55. This whole notion of metered bandwidth is fascinating. It was not an issue till streaming videos slowed down productive work. Happened to speak to a university IT department recently, and they indicated how bandwidth to and from the internet backbone was their most constrained resource.

    It seems that market forces are working very well here. As the demand for bandwidth has increased, providers can charge higher prices. The tiered pricing model seems fair to those who consume less bandwidth. Metering of bandwidth is also in line with my thought process as a proponent for metered pricing for high value SaaS (Software as a Service) offerings.

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  56. I’m right on board with Keith…metered doesn’t mean that there’s just one tier. Too often people think that there will or can be just one cap. Instead, light users will have a tier where they can have high speeds but lower caps at a lower price, and heavy users will pay more than they do today.

    With metering the carriers might also be willing to raise their speeds since higher speeds does not necessarily mean greater consumption.

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  57. Alan:

    >That last mile, so fraught! When I asked the data head end guy out
    >here why the subscriber up/down speeds were asym, he said, People
    >are asymmetric.
    Yes, they generally are.

    >6 down, 1 up. Crazy, especially when the segments at the zone
    >level can dynamically allocate the backhaul to take advantage of
    >idle or low usage at the subscriber switch side.
    I’m not sure what you’re saying here. Operators don’t manage their
    backhaul so tightly that they allocate bandwidth on a moment by moment basis.

    >It’s all made up, this argument of scarcity. They have plenty of
    >idle bandwidth in the terrestrial plants (cable), and they are just
    >trying to set up the squeeze. DSL is a bit different, but not
    >terribly so.
    Work for an operator and you’ll know differently. The challenges around last mile for share technologies such as cable and wireless are real.

    >There will be a new portfolio of wireless broadband ventures that
    >will put the whammy on the incumbents when and if they start metering.
    >Then we get our caps lifted.
    Be my guest. Residential wireless broadband will always be magnitudes less than wireline technologies.

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  58. Chris and folk

    All to the point, but I wanted to talk more about the 10 cents a gig figure mentioned above. I believe I was the first to use that number, a while back reporting on a wall street briefing by Tony Werner, and I’m glad it’s getting around. No one will speak on the record because it’s so political, but several with the real information said it was about right for then.

    However, the 10 cents was the cost to the carrier, and I think there’s nothing wrong with a reasonable markup. The 1000% markup in almost all the capped plans is an absolute ripoff, but I’d make a point of saying 10 to 20 cents is about right. Adjusting that ten cents for Moore’s Law drops in bandwidth costs, a large carrier is paying 4-7 cents. (Small and rural a different story.) So 10 cents might be a little draconian.

    The other implication of that 4-10 cent cost for a large carrier is that folks like Telstra mentioned above are ripping off their customers, and probably also the ISPs who muct by backhaul form them. That’s true of BT in Britain and Bell Canada, but I haven’t looked closely at Australia. 250 gig free (Comcast’s suggestion) is fair based on industry cost numbers (I’ve written the DSL industry news for a decade.) 5 gig (the now canceled Frontier plan. Thank you Om for the coverage) is off the wall, and Time Warner’s 40 gig is not about real bandwidth costs but rather a disguises price hike and attempt to prevent competitive video, based on everything I know about cable costs. db

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  59. [...] the case of delivering Olympic coverage online, lower-level caps may already be having an effect, but it’s hard to tell without software to [...]

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  60. [...] at 7pm, but you will at 3am. Since the consumption of bandwidth is exploding due to the increasing popularity of online video (not so much P2P filesharing), Comcast and other providers need a solution which gives their customers service without outages [...]

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  61. [...] some of the latest applications and services, thus harming innovation. For example, in 2008 the video live streams from the Olympics contained this warning: Since the NBC Olympics on the Go software delivers large video files, it [...]

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