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Communications The Almighty Buck Businesses

What Kind of Alternate Business Models Could ISPs Use? 360

Posted by Zonk from the nothing-wrong-with-the-ppu-strategy dept.
esocid writes "After reading multiple stories over the past few months about the practices of ISPs within and outside of the US I have started to actually contemplate the benefits of the pay-per-use broadband service. Monopolistic practices have strangled broadband to the throttled money-draining cesspool that it is today. Would a pay-per-use option, or some other strategy, be better than the flat fee offered by companies today? When you think about it you are paying for an XMbps connection, when in actuality you get an 65-85%XMbps connection that you may or may not use all of the time. In addition to that, speaking as a Comcast customer, you get a throttled connection that limits your usage of certain protocols. Essentially you pay about $60-70 for a connection that you only squeeze maybe $35-45 worth of usage out of it. If a pay-per-usage option were implemented, how do you think the best way to charge for it would be? Is there some other scheme that would deliver customers the kind of QOS and value they seek?"
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What Kind of Alternate Business Models Could ISPs Use? More

What Kind of Alternate Business Models Could ISPs Use?

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  • Not really the point... (Score:5, Insightful)

    by TripMaster Monkey ( 862126 ) on Tuesday April 01, 2008 @01:48PM (#22932326)
    I'm sure there are several alternate business models that ISps could employ that would result in fairer, more even-handed access and pricing.

    However, this is not in the ISPs best interests. The ISPs interests are best served by the current business model...the promise-you-x-amount-of-bandwidth-but-give-you-only-0.4x business model.

    Don't expect change anytime soon.
    • Effectively, what you're really paying for is maintaining the physical & electrical link, the hardware on both ends, though of course, the marketing, executive limo, and all that is in there too. The numbers I've seen in the papers in terms of data cost are pretty low, I recall seeing a number something like it's about $2.50 per household on average. So I really don't see how things will change a lot if people were charged a lower base fee plus the bandwidth you use. Another reason the pricing is unl
    • Actually, I think a pay for what you use model could work in everybody's favor. What if you charged on a per bit basis just like the electric or gas company? That means the people who do casual web surfing and e-mail will pay very little and will use less bandwidth and the people who do heavy gaming, bittorrent downloads and the like that use lots of bandwidth, pay more. The amount of money a heavy user can spend on internet is limited by the bandwidth. If it's slow, they can only download so much. Thi

      • Re: (Score:3, Insightful)

        by rmerry72 ( 934528 )

        What if you charged on a per bit basis just like the electric or gas company? ... More bandwidth, more bits/month getting to the user, the more money the user pays to the ISP.

        This is essentially the model used in OZ now, only you prepay for a block of GB as part of your monthly stipend, then your either capped or pay an excess useage charge depending on your ISP. It hasn't helped and didn't lead to lots of investment in infrastructure - we still have some of the worst broadband facilities and the most con

    • Re: (Score:2)

      by Phroggy ( 441 )

      However, this is not in the ISPs best interests. The ISPs interests are best served by the current business model...the promise-you-x-amount-of-bandwidth-but-give-you-only-0.4x business model.

      Don't expect change anytime soon.

      That's only true in the absence of competition. Some people are fortunate enough to be able to choose between cable modem service, DSL (where they can choose between multiple ISPs [qwest.com]), 3G wireless [vzw.com] from their cell phone provider, satellite [hughesnet.com], and other wireless services [sprintbroadband.com], and maybe even broadband over powerlines [wikipedia.org].

  • who cares about business models? (Score:5, Funny)

    by jollyreaper ( 513215 ) on Tuesday April 01, 2008 @01:48PM (#22932330)
    I want to know where the April Fools articles are. So far, everything is boringly normal. Give me some funny shit! Microsoft debugs Vista, "Best Windows yet!" crows Richard Stallman. Bush finds exit strategy for Iraq. Catholic priest shoves fingers up own ass for a change.

    Where's the A material? Even Poniez is looking good at this point.
    • Yeah,... where is the OMG PONIES!!!!!!!1

    • Re:who cares about business models? (Score:5, Insightful)

      by nacturation ( 646836 ) * <nacturation AT gmail DOT com> on Tuesday April 01, 2008 @01:55PM (#22932414) Journal
      Compared to the insanity of last year, having an all-normal day would be one hell of an April Fool's.
       

      • Re:who cares about business models? (Score:5, Insightful)

        by jollyreaper ( 513215 ) on Tuesday April 01, 2008 @02:11PM (#22932612)

        Compared to the insanity of last year, having an all-normal day would be one hell of an April Fool's.
         
        But I'm ready for it now! This is like watching what's supposed to be a horror movie, you're all ready for the jump-scare, the woman is walking around in a dark house in her panties looking in all the creepiest rooms, opening cabinets, peeking behind shower curtains, and nothing! Not even a cat jumping and screeching from some impossible location no cat should be in.

        Finally I'm ready to not get suckered on April Fools and they sucker me by canceling it. Bastards.

    • Re: (Score:2)

      by fbjon ( 692006 )
      There's no pleasing some people....

    • Re:who cares about business models? (Score:5, Funny)

      by hey! ( 33014 ) on Tuesday April 01, 2008 @02:13PM (#22932636) Homepage Journal
      OK, how about this for an idea:

      Hooters founder Robert Brooks has started a new business: providing Internet services.

      Jack-In Broadband [sm] will provide broadband installation and support services, with a twist. All installations will be performed by female technicians wearing brightly colored plastic miniskirts and crop-tops. On-line tech support will also be provided by "Jack-In Girls", via real time two way video link.

      Women's rights groups are criticizing the planned service. "This is demeaning to women in technology," said Maria
      Testicolo-Lattine, the Florida director for the National Organization for Women. "Not only are they being valued for their bodies over their skills, they are being paid only minimum wage."

      A corporate spokesman for the company confirmed that the technicians would only be paid minimum wage, and would have to buy their own uniforms, tools and vehicle, however he denied that they were being exploited. "These girls will make plenty of dough, through gratuities and, uh, little side services they provide our customers." The spokesman asked that his name be withheld. [Ed. -- editorial policy does not allow for corporate PR officers to be quoted anonymously. The spokesman quoted was Anthony Testicolo, from the company's Miami office.]

      The service is slated to begin in the Clearwater, Florida market, expanding to eight metropolitan areas in the southern US over the next two years. There are no plans to market the installation service in the north, due to the impracticality of the technicians' uniforms in that climate, although negotiations are under way to offer the on-line support services through cooperative agreements with several national ISPs.

    • my guess is that either...
      A. The joke is that there are no jokes, and the joke's on us for debating on every story whether it is a joke or not
      or
      B. The joke is all the Anastasia 'Russian bride' dating service ads all of a sudden (given the large number of AdBlock users, that joke would be lost on most).

      If the latter is not a joke, then I do fear Slashdot's new ad policy :>

      • my guess is that either...
        A. The joke is that there are no jokes, and the joke's on us for debating on every story whether it is a joke or not
        or
        B. The joke is all the Anastasia 'Russian bride' dating service ads all of a sudden (given the large number of AdBlock users, that joke would be lost on most).

        If the latter is not a joke, then I do fear Slashdot's new ad policy :>

        You think that the Reiser story might put geeks off the whole Russian romance bit?

  • Split Solution (Score:4, Interesting)

    by CheeseburgerBrown ( 553703 ) on Tuesday April 01, 2008 @01:49PM (#22932334) Homepage Journal
    I think that even in a pay-as-you-go type solution, a certain base threshold of traffic would have to be free, and the customer would pay on top of that. Otherwise, the user is penalized for visiting a site that rams heavy multimedia ads down their throats or for downloading spam to be filtered.

    Another idea may be a price ramp: if I usually only use 5% of my connection, the cost for a spike in my usage should be low. Similarly, if I'm a heavy user than my spikes (higher, more frequent) would carry a heftier price tag. In other words, occasional spikes should be discounted while habitually heavy users would have to pay more to accommodate their persistent digital lifestyles.

    Finally, I would only consider such a scheme if my account were discounted for every second of downtime during each billing cycle, whether it affected me directly or not. If have to pay for what I use, they have to pay for what they don't deliver.

    • Forget downtime, I want a proportional discount depending on the actual available bandwidth versus the rate I am paying for. If my connection speed is currently 80% of what i paid for, I want a 20% discount off my bill (which had best no longer include a base monthly charge).

    • Re:Split Solution (Score:5, Interesting)

      by Spy Hunter ( 317220 ) on Tuesday April 01, 2008 @03:19PM (#22933436) Journal
      The problem with most charge for usage schemes is that people might get stuck with huge overage fees and not understand why, because people have no idea how much bandwidth different things take. Or, your computer could get infected with a trojan and use terabytes of bandwidth to send spam and you'd get stuck with the bill.

      However, charging for usage *is* a better solution, for many reasons. The most important is that it aligns the ISP's interests with those of its customers. Right now an ISP's best customer is one who doesn't use the product at all; heavy users are their least profitable customers. This is the root cause of all the problems people have with their ISPs (port blocking, BitTorrent blocking, not upgrading infrastructure, cooperating with RIAA subpoenas, terrible customer service, outspoken opposition to bandwidth-using services like online video); it all stems from the fact that ISPs have a huge incentive to *discourage* use of their product! Under a charge-for-usage scheme, that's all *reversed*. ISPs would make the most money from the heavy users, and so would encourage usage by eliminating all blocking and filtering, upgrading infrastructure, telling the RIAA to get lost, improving customer service, and encouraging bandwidth-using services like online video.

      In addition to making ISPs the friends of their customers, charge-for-usage would also solve some of the Internet's big problems. Suddenly people with trojaned Windows zombie machines would be charged for all the crap they spew, giving them an incentive to secure their machines. P2P users, instead of being subsidized by the majority who use less bandwidth, would see the real costs of their traffic in their bill. If there's any truth to the "bandwidth crisis" the ISPs keep whining about, charging for usage would solve it.

      So charging for usage is desirable, but how can we do it without huge overage fees? It's easy. Instead of paying for bits transferred directly, we should pay for the *speed* of transfer, almost like we do now, but with one addition: each bit transferred lowers your speed cap slightly. This cap is explicit with a big speed gauge and graphs showing your usage (it is important that this graph be very user friendly so people can figure out what is using their bandwidth). Here's the key: at any time (not necessarily monthly) you can press a "speed boost" button that charges your account and raises the cap, but it's not automatic. Under this scenario there are no explicit tiers and not even a fixed monthly payment. You pay exactly the amount you want, when you want, and get service commensurate with your payment; blazing fast or just enough for email, it's up to you. There are never overage fees; instead your service just becomes slow. If your computer gets trojaned your service will slow to a crawl, you'll look at your graph and see a giant spike of traffic from the computer in question, and you'll know to fix it *before* you press the "speed boost" button.

      I hope someday ISPs and ISP customers alike will come around and see that some method of charging for usage is the only sensible way to do things. With this scheme we get all the advantages of charging for usage, but none of the drawbacks. No overage fees and no hard caps.
  • Having lived through the bad old days when pay-per-use was still popular with ISPs, I'm forced to say no way. It's great for the ISPs, I'm sure, as they can arbitrarily set the "value" of a certain amount of bandwidth completely ex recto and hold everyone to that. For consumers, however, it's terrible; they invariably end up paying more for inferior service plus the fear of using more bandwidth and having to pay more.

    • Re: (Score:2)

      by conlaw ( 983784 )
      Yes, I started out on AOL in days when it was the only option where I lived. As I recall, you could pay something like $9.95 for five hours per month, but then you paid 25 or 30 cents for every minute you went over the five hours. It only took most of us one month of overage charges to decide that the $19.95 "unlimited" plan was much better.

  • $/MB (Score:5, Informative)

    by fred fleenblat ( 463628 ) on Tuesday April 01, 2008 @01:50PM (#22932356) Homepage
    in terms of $ per megabyte broadband is the best deal going. taking into account the throttling and limited upstream pipes...it's still a screaming deal. go price T1's, or try to live with satellite broadband, dialup, or 3G. all these alternatives have profound limitations.
  • What customers want is Pay for what you use until you reach a point and you pay fixed price.

    People want to be reworded for using less and not punished for using more. So if you have a Fixed Price internet Raise it up only a small amount a few dollars a month and set the point so 80% of the customers are paying less or equal per month and 20% are paying the same and perhaps a bit more, but not so much that it will put a shock to their budgets.

    • Re: (Score:2)

      by sm62704 ( 957197 )
      If you have actually done scientific surveys show us the research. Otherwise it's just bullshit and the only customer who you know what he wants is you.

      I want flat rate. But then again I'm the only customer that matters to me.
  • I think the subject line speaks for itself. If any of them was actually making a superior product consumers would flock in a heartbeat.

    How about invest in infrastructure to help your long term business increase? Spend a little more to make something better to get an exponential benefit out of it in the long run. I seem to remember somewhere saying that to retain 10% more of your current customers will be more profitable than adding 25% new customers due to all the additional managerial and other costs invol
    • If only there was a company rolling out fiber in US cities... If only they provided more bandwidth at the same cost as cable... If only they provided the bandwidth they advertised If only they didn't throttle Well, thats my experiance with FIOS... I pay for 20/5, I get 20/5... I don't see what the problem is... just move someplace where you can get it, and pray verizon doesn't change to be more like comcrap
      • Of course they will. They all start out great to build a customer base and then change to an inferior quality of service.
    • Retaining current customers is, indeed, in most cases cheaper than gainng new ones, but that doesn't necesserily justify blowing billions on infrastructure just so that grandma can forward lolcats faster.

      Basically, why not bundle (OMG) ponies for free with each broadband subscription too? Sounds great to me!
  • I bet for every 1 person that realizes a lower bill, 5 will have an increase. The reason? The idea sounds good now assuming the variables will remain static....they won't.

    As soon as a change is made, the laws of eqaulibrium will kick in and what is sure to happen is the ISP's will adjust their pricing to either maintain (or probably increase) their take.

    That won't happen if people start paying less.

  • Pay as you go (Score:5, Insightful)

    by jockeys ( 753885 ) on Tuesday April 01, 2008 @01:55PM (#22932410) Journal
    honestly, internet access is very nearly a commodity, why not bill it as such?

    Assuming all my ports are equal, and I can xfer upstream and down at whatever the physical rate of the device is:
    bill me by the megabit-hour. Just like txu bills me by the kWatt-hour. I can use whatever I want, but pay accordingly.

    Alternately, bill me at the end of the month for gigs xferred, which is already done for hosting in some cases.
    • Agreed. One problem with pricing is one-or-two-size fits all method. What I use and what my mother uses are two different things. She'd be fine with a 256k down/56k up. All she wants to do is email some pictures and surf a few web sites. I'm the one sucking down linux isos. Pricing by usage should be the norm. Have plans that charge a small amount per mb ($0.001 or something like that), that then max out at a certain level (the unlimited price). Maybe you could charge 0.0001 per mb down and 0.001 per mb up
      • The net result of that scheme is that heavy users would pay the same and low usage customers would pay less. The means an overall cost reduction for the customer and a profit loss for the ISP.

        This is really about one of two things. Either people just want to pay less for internet access. Or this is about people who don't utilize their connection getting annoyed that those who do so are getting more value than they are.

        As for those who want unrestricted access, how about switching ISPs? Its not a perfect wor

  • Plenty of case studies... (Score:5, Interesting)

    by JustinOpinion ( 1246824 ) on Tuesday April 01, 2008 @01:56PM (#22932422)
    This question is not nearly as theoretical as the question suggests: there are many countries where various forms of metered or tiered access are the norm. You just have to look at what these countries offer (and how consumers react) to get an idea of what works and what doesn't.

    Here's an example: Videotron cable internet [videotron.com] (Montreal, Canada)*. They have packages that run from $30/month to $80/month, depending what you want. They all have usage limits (2 GB/month to 100 GB/month), and charge a fee per additional GB beyond this basic usage.**

    Does it "work"? Of course. Customers buy the package they want. If they are routinely going over their monthly limit, they either cut back on usage or upgrade their package. Yes, it is slightly more complicated for the customer than just having a single "unlimited!" package, but then again it's also more honest. In fact the unlimited packages have hidden terms and limits, which makes them more complicated... or at least more annoying.

    I'm a heavy internet user (as most Slashdotters probably are). I don't mind paying a premium to get the speeds and usage limits I need: as long as that service level is actually delivered! This isn't rocket science: just provide a variety of packages and let the customers pick. Importantly, price the packages so that you won't go out of business if a sizeable percent of your customers actually use the service you sold them.

    [*] Note that I was a Videotron customer when I lived in Montreal. I'm not endorsing their service; merely using them as an example.
    [**] Note also that if you really want unlimited usage, you can upgrade to business class service [videotron.com]. Again, you pay a premium if you want that level of service, which is fine.

  • Is this a serious question? (Score:5, Insightful)

    by carnivorouscow ( 1255116 ) on Tuesday April 01, 2008 @01:57PM (#22932438)
    I know I'm risking what little karma I have as a new poster but this question seems bizarre. Throttled connection speed is primarily a US problem and has a lot to do with the telecoms not keeping their promise to Congress to create a fiber optic network across the nation. Now they're reaping what they've sown and are trying to create an excuse to pass the buck to their customers rather than fulfilling their obligations.

    I could see a tiered system for connection speed that billed based on KB transfered being reasonable if the telecoms were doing everything in their power to meet increasing capacity demands but they're not.

  • Summary is not quite right (Score:3, Insightful)

    by NeutronCowboy ( 896098 ) on Tuesday April 01, 2008 @01:57PM (#22932440)

    Essentially you pay about $60-70 for a connection that you only squeeze maybe $35-45 worth of usage out of it./blockquote.
    From my understanding, you actually pay $60 for a connection that ought to cost you about $600. For what real usage costs, compare the home pricing with business pricing. Speakeasy offers symmetric T1 for $400. That gets you 1.5 Mbit both ways. Get a home connection, and they charge you $50 for a basic DSL connection of 1.5 Mbit down, 384Kbit up. And that's if your connection is good and noise free.

    This idea that the actual cost of a connection is $60 is ludicrous. Yes, companies played a dangerous numbers game that didn't account for all the new ways that end users can saturate connections, and they're trying to play catch-up now through questionable methods. But some end-users are also using far more than what they're paying for.

    That said, this is no excuse for the sorry state that broadband is in. Monopolies (or, at best, duopolies) are killing the American broadband market. My connection has stagnated at 1.5Mbit (actually ~800 Kbit due to line noise) for the last 8 years, with prices regularly going up for unfettered access. When looking at how connections improved in the rest of the world, I can only believe that a complete lack of market forces could lead to this stagnation.

  • Deliver Promises. (Score:4, Insightful)

    by headkase ( 533448 ) on Tuesday April 01, 2008 @01:58PM (#22932460)
    How about they give you what they promise, set their price against what they actually think it costs and let competition work its magic. Promising what they don't deliver fscks up Adam Smith's invisible hand.
  • The crux of the problem is that if an ISP says they are providing a "3MiB/s-down with 300kb/s-up" connection, that is what they should be delivering. You can't sell something as one thing and then not deliver it - this is called fraud.

    If they can't deliver at the speed they sell it as, then they shouldn't be allowed sell it as the higher speed.

    The fact is that they want to be able to promise one thing and then reneg on the delivering the goods. Why do we let them get away with this?

    Graham

  • Taxes (Score:5, Informative)

    by ahfoo ( 223186 ) on Tuesday April 01, 2008 @02:07PM (#22932570) Journal
    There's your business model.

    I'm dead serious. Telecoms is a "natural monopoly". (http://en.wikipedia.org/wiki/Natural_monopoly) A monopoly is not something you build a business around, it's something you regulate. Thus, it is best funded by a regulatory regime AKA, a government.

    And, for the practical example. I'm in Taiwan where the telecom is state owned. I am using the state owned telecom DSL service at 8M/640K for about thirty bucks a month although we just got a slight reduction in fees this month. Yeah, imagine that, a reduction. We have no throttling and the service, which I've had for about five years at that level is excellent.

    Sure, there's a monthly fee for use, but the service is provided by a government monopoly which is obviously derivative of taxes.

    • Re:Taxes (Score:5, Insightful)

      by sm62704 ( 957197 ) on Tuesday April 01, 2008 @02:53PM (#22933108) Journal
      At the risk of getting into the same tired argument with the same slashdotters I argued with yesterday about health care*, I have to agree with you. I don't believe natural monopolies like roads and electricity should be left to the private sector. Here in Springfield [wikipedia.org] our power company is owned and run by the city government. Our rates are the lowest in the state, and our electricity is the most dependable.

      -mcgrew

      * there are some here who believe that the huge problems we have financing our health care are, believe it or not, caused by overregulation rather than the fact that the customer has no choice, nor can have any choice. I have to agree to disagre with these folks.

  • Dual-tiered (Score:3, Interesting)

    by Tyler Eaves ( 344284 ) on Tuesday April 01, 2008 @02:08PM (#22932578)
    Have a two level plan. Users would pay for however many gigabytes of high speed service at the wanted, which would be ultra-fast, 10Mbit at least, preferably higher.

    They'd also have access to a baseline service in unlimited amount, but highly throttled...512Kbit say. Plenty useable for basic stuff, even MMOs and the like, but not for mass pirating. The user could toggle between the modes so as not to waste high-speed bandwidth checking e-mail or whatever.

  • What makes you think you're only getting $35 worth (Score:4, Interesting)

    by Overzeetop ( 214511 ) on Tuesday April 01, 2008 @02:10PM (#22932596) Journal
    The issue is primarily one of convenience and plant cost. To get you 10Mb/s is mostly capital costs, so you pay a fixed rate. Overselling is done because average users don't saturate their channels. Businesses, otoh, do and they pay for the luxury. Pay per bit service would be difficult to structure without a fixed cost. Once you cover billing, tech support, and plant, you're up to nearly what everyone is already paying. Adding per-bit charges will only make it more expensive. Sure, you can pay more for a guarantee but the value of that guarantee is far less to the consumer than to the operator. And if you put your guaranteeds on the same line as your basic oversold, you're going to have to actively sort them out.

    BTW - how much data does $35 buy you? Maybe you're getting $100 worth of data for the $70 you pay Comcast, and you just don't realize it. I would venture to guess that if you divided the entire data stream by the revenue, most slashdotters are getting more bits per dollar than the overall system average. Even if you just camp on the throttled ports, you may still be getting more bits than a dollar of Comcast plant depreciation.

  • Essentially you pay about $60-70 for a connection that you only squeeze maybe $35-45 worth of usage out of it. If a pay-per-usage option were implemented, how do you think the best way to charge for it would be?

    Well, it depends who you ask. If you're the provider (ISP) and you've established your business model getting $X profit on an "unlimited" setup, you'd probably set up your pay-per-use option to end up getting you the same. It sounds like I'm being sarcastic, but I'm not.

  • Accountability? (Score:3, Insightful)

    by jc42 ( 318812 ) on Tuesday April 01, 2008 @02:11PM (#22932608) Homepage Journal
    One major problem is: How would I know that I'd been charged fairly?

    In my experience, when I get details of my net usage, there's a lot of stuff there that I can neither control nor account for. Thus, most browsers honor a page's request to refresh it every N minutes, and don't give me a way to turn it off. Any browser that's running can be using bandwidth without most users being aware of the fact. This is especially true for pages that include advertising.

    For a while, I had a smartphone with wireless net access. Even when I didn't use it, it ran up packet charges. When I asked, I was simply told that the networking software sends packets on its own. "That's how it works." It's not obvious how a customer can challenge something like this, except via extremely expensive lawsuits.

    And what about that advertising? I didn't want it, but it comes "free" with the content that I wanted. Would I be charged for downloading the ads? Of course, I would; what a silly question. Even (or especially) the flash ads. Yeah, I have flashblock installed, but not all browsers honor it, and not all users are aware that it's possible, so this is a potential source of large charges by the ISP.

    But the fundamental question is: When my ISP tells me I used X gigabytes last month, how do I know they're not just making up a number? What tools are available that will tell a customer exactly how many bytes of bandwidth they actually used? And if this number differs from the ISP's number, would the accounting tools' data stand up in court?

    Unless you can answer this, a pay-per-byte scheme is merely an way for an ISP to charge customers whatever they like, and the customers have no recourse other than to terminate the service entirely.

  • Alternate business model: (Score:5, Interesting)

    by NeutronCowboy ( 896098 ) on Tuesday April 01, 2008 @02:12PM (#22932618)
    Here's a truly alternate business model: screw the incumbent telecom carriers. Nationalize the grid that was built out with the help of public funds, and where the public has seen close to no returns. Turn everyone into a CLEC. Everyone plugs into an existing grid that is officially tax-payer funded with zero restrictions on what passes through. All the intelligence - traffic shaping, filtering, content - will be at the edges. Carriers compete based on service, what kind of pipe they can put into the home/condo/dorm and how much traffic they can exchange with the national grid.

    Far-fetched? Not really. It's similar to what's going on with the electric grid already. Considering how much the economy is impacted if/when major trunks or local exchange points go down, the internet is also a similarly critical infrastructure. I don't see why lessons learned from the electric grid can't be applied to solving the mess that is the telecom industry.
  • Not hard.

    Raise the contingence ratio to 50:1

    Then claim BS things like "We provide the pipe, not that the pipe can be filled". and
    "We reserve the right to do anything to the downstream and upstream as we see fit. We wrote the contract, so bend over."

    Oh... Thats what they do now.

  • Just give us honesty (Score:3, Interesting)

    by Tweaker_Phreaker ( 310297 ) on Tuesday April 01, 2008 @02:21PM (#22932710)
    All I want from any ISP is the honest truth of 1) what the maximum throughput from my house to the first hop is and 2) what the minimum guaranteed rate is when things get congested locally. In effect I want to know how shitty things will be when everyone in the neighborhood is on and how great they'll be when people aren't. Don't nickle and dime us because we're using more bandwidth, just make sure we know how much it'll be throttled when your pipes can't handle it.

  • Why not go over to 95th? ... (Score:3, Interesting)

    by lordsilence ( 682367 ) * on Tuesday April 01, 2008 @02:24PM (#22932744) Homepage
    Hey. What most private customers dont seem to realise is that bandwidth is very expensive. Some expects DEDICATED bandwidth from your ISP. That's entirely unrealistic. Maybe it's time to start charging private customers by the 95th percentile? if they want dedicated.. Private internet connection is not dedicated and will never be if customers expects prices to go down. It would increase tenfold if you were to pay the actual prices isp's pay for peering , transit et al.

  • Overpriced to begin with. (Score:3, Insightful)

    by v(*_*)vvvv ( 233078 ) on Tuesday April 01, 2008 @02:29PM (#22932786)
    The problem with pay-as-you-go being optional is that the people who use less will opt for it, while others will go with the unmetered plan. This gives no upside for the ISP. Either one or make the pay-as-you-go a premium rate, in which case it won't be cheap anyway (like prepaid phones). Also, there is the whole measuring infrastructure that adds to the things they need to do and will mess up on.

    The bottom line is there needs to be more competition, and better infrastructure. The infrastructure needs to be public property and cable companies should be able to compete over shared cables.

    I am not satisfied with my cable service or their internet service, but I have no alternative.

  • they need an alternate clue!

    Like for example, the concept that if you advertise a certain amount of internet bandwidth, you deliver that bandwidth... not just the amount of bandwidth for the kind of protocols that THEY feel appropriate.
  • Somebody suggested that bandwidth should be billed by the number of gigabytes transferred per month, just like electricity is billed by kWh. That made me think of another idea: charge two different rates for peak vs. off-peak usage. Encouraging people to run their BitTorrent downloads at 8am instead of 8pm should reduce the amount of capacity needed at peak usage times.

    My electric company offers something like this. I'm not doing it, because most of my electricity usage is relatively constant throughout

  • Business models are useless (Score:3, Interesting)

    by bjourne ( 1034822 ) on Tuesday April 01, 2008 @03:05PM (#22933268) Homepage Journal

    The premise of the question is wrong. There doesn't HAVE to be a business model at all for ISP:s. Currently, no matter what connection you have, what you pay for is NOT for your big fat pipe, it is for the ISP to run the billing. It costs ISP:s a lot more to employ accountants, collect user data, keep customer databases, marketing and send bills than it costs them to deliver traffic. A tiered internet, or a pay-per-megabit system would just add to the overhead as ISP:s would need to employ more accountants and implement more monitoring systems to track exactly how many megabits their users transfer.

    Kind of similar to how Nike shoes doesn't cost many Euros to produce using the Chinese child labour they employ, but are marked up hundredfold. But the case with ISP:s is even more egregious because they are all 100% government sponsored institutions. Governments either built all the infrastructure or heavily subsidized telecom companies to do it. The net is public property and companies really have no moral rights to charge money for it.

  • Pay as you go is being blind to the future (Score:4, Insightful)

    by edmicman ( 830206 ) on Tuesday April 01, 2008 @04:21PM (#22934194) Homepage Journal
    Come on, what is wrong with a lot of you?!? Sure, at this point in time a minority of users might be using the majority of the pipes. "Tax the heavy downloaders!" you say. Have you forgotten that Microsoft (X-BOX Live and Marketplace), Sony, Apple (HD movies), Joost, Tivo, Netflix, Amazon, etc. etc., all want to push more and more bandwidth intensive apps and uses?? Sure, Joe average may only use 5GB now with occasional YouTube videos. Maybe $15/mo would be good for him. But if the big players have their way, and they will, Joe will be watching, buying, and streaming HD video and games in the near future. 5GB ain't gonna cut it. The ISP's would love to knock everyone up to a "high tier" service that's $100/mo, but that sucks if that's the entry point just because the ISPs have milked this cash cow as long as they could.

    ISPs creating tiered service levels is only them trying to prevent the inevitable - that they are being pushed into only providing an on-ramp to the Internet, and that's all. We're in the middle of a revolution in how content will be delivered, this crazy notion of tiered service levels is only going to mess that up. Of course, it will be steamrolled by innovation in the field.

    It's like a small town experiencing a population growth, and wanting to turn Main St. into a toll road to discourage new citizens. Tiered pricing isn't designed to make things more fair; it's designed to discourage those at the top end and make those at the bottom end feel like they're getting a good deal.

    We're already seeing mobile phone service becoming a commodity, with carriers offering true unlimited service after years of nickel and diming you for each partial minute you use. Are the cell carriers going to start complaining that everyone is actually talking constantly 24/7 and using up their lines? No, they'll build out more infrastructure to meet the demand. Why would the ISPs go the opposite route??

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