Time Warner Cable is going to start charging its customers extra to download games, watch videos or even update your games. This is going to adversely affect any internet based business, regardless of actual cost to the customer.
Percieved pricing will prevent some customers from using services like Impulse and Steam.
Imagine downloading a "free" 8 GB HD movie and having to pay $8.00 just for downloading it? Yep, it's $1.00 per GB.
Time Warner did a test run of the price gouging effort in a few cities and is now poised to widen its grip nationally.
Locally, a city council member has spoken out against Time Warner, but to what avail?
Leffingwell chastises Time Warner for Internet pricing plan
There's a loophole for some of us. Even though Time Warner has the monopoly on cable and dsl internet service where I live, a secondary provider that uses Time Warner's infrastructure doesn't have to apply the same pricing scheme. I got word from Earthlink this morning that they have no plans to copy Time Warner and that their customers are safe from the price increases. A time Warner customer can simply switch over and still use the exact same infrastructure as before and maintain peace of mind while using the internet. You don't even need to change your cable or DSL modem.
Hopefully, more customers will be able to find secondary providers like Earthlink. I'd suggest that any TW customers switch to whatever secondary provider is in their area before this hits the fan.
For all of you who think this is a "greedy" move by Time Warner, would you rather see them go out of business? Their current pricing scheme is unsustainable since it relies on users not using the bandwidth allocated to them. This was fine a few years ago before YouTube and Hulu became popular. Now everyone is using lots of bandwidth and on top of that more and more people are learning how to use BitTorrent and are getting their software through digital downloads instead of physical media.
If you all have your way, Time Warner will go out of business and you won't have any internet at all (if you live in an area where it's the only option). To me this seems like a worse outcome then them adjusting their pricing model.
The alternative would be to raise everyones prices significantly (both high-bandwidth users and low-bandwidth users) so they have enough revanue to sustain the usage overall. To a high-bandwidth user this sounds great, but how do you think the low-bandwidth users feel about paying for your downloading habits? The people who just check their e-mail and browse the web are likely to get even more pissed off by that then the high-bandwidth users will get from having to pay when they go over their cap (a cap that is actually reasonably high if you get the more expensive package).
Hi, I work for my local ISP and we actualy have been doing this for YEARS. Everyone seems to be panic'ing here but this is how it REALLY works if they follow our model. First internet prices will DROP! yes, that's right, they will go down. Or they might just freeze prices where they are for a while.
Why you ask? Say you have 10,000 subscribers who use internet. You have to raise the prices for these people for say 20 people who are using 99% of the bandwith. these 20 people either have filesharing (most don't even KNOW they do!) or run servers or a busness ect. So the other 9,980 people pay several dollars/month to pay for the bandwith costs for those few people. It costs money to ship data! Think of the electric bill alone!
On our service only about 2% of our customers even KNOW we have this. Typicaly they turn off filresharing (we tell them how) and poof, they can download all they want and not have to worry about 100 people downloading from THEM eating all that bandwidth.
Internet gaming going away? Guess again. Gaming online uses VERY LITTLE bandwidth, so does Vontage phone service. Hardly anything. Honestly you could game 24/7 and not use hardly any bandwith. When we first changed to this I was worried as I 2 box'd online, But when I saw my bandwidth usage as under 2 gig for playing 2 computers 40+ hours a week.. Yea... Patches are your big use! Download movies? Just watch your bandwidth and pace yourself
So Basicly this will make Internet cheaper for 95% of us out there. The other 5%... Yea, they might have an issue, but the worst of those would have thier service "terminated for vilolating terms of service" with no warning!
So Relax
Gravity is not a theory, its a fact. Just like evolution is not a theory, but a fact. The theoretical aspect of gravity is what exactly Gravity -is-. Hell, the fact you're stood on earth and not floating into space is proof of gravity.
Now have you ever tried walking down the street and just looking around? We are habitual creatures unfortunately and often glance over wonderous things. Do you realise we made our own Caves? harnessed fire, created the wheel. History is repleet with astonishing, amazing creations. We've travelled to the fucking moon for christs sake! We can -see- single atoms and move them about, we create wormholes for scientific experiments (though i think they do it for fun).
No human achievement however can surpass the groundbreaking and revolutionary attempts we create to share information with each other. From talking to each other we developed writing, through writing we developed printing yet the internet for all intents and purposes in my eyes dwarf's all these previous creations. Its without doubt the most revolutionary and important creation in human history.
It contains anything and everything, defies control from any one authority. It allows any person to have a voice and for that voice to be heard by the world itself...in a second. Any regulation...be it through censorship, or access limits should be stamped out. Its a tool to be wielded by humanity and really -should- be under direct control of a goverment who's sole purpose is to ensure everyone gets to access it regardless of cost or inconvenience.
/endsocialistrant
Gravity is fact, darwinian evolution is religion. Darwinism is just something that sounds reasonable enough to believe in, but there's no conclusive evidence on its accuracy, same as any other religion out there.
Some of you really need to spend some time outside of the USA. The internet offerings here are slow and expensive compared to our peers. It's just plain crap. It's difficult to believe (but certainly not impossible) that people defending these companies have experienced much else but these companies which is a real shame. It can be better and less expensive; it's already done.
As a Time Warner employee (I work for AOL) and shareholder of Time Warner and TWC (it was recently spun off as a separately traded company) I disapprove of this action. It is reasonable to monitor and throttle the bandwidth of the very heavy users (i.e., those running peer-to-peer servers) so they don't adversely impact the other users but this plan makes TWC look money hungry. Such low caps and a high price per GB after the cap will have a negative impact on mainstream broadband users and broadband services!
You need to focus on why instead of what.
This is the primary cause of the difference in broadband infrastructure between the US and other post industrial countries. I'd need ten miles of cable or my own bloody tower to get real broadband here. Not a lot of prospective customers in an area with a population density low enough to measure in square miles per people instead people per square miles.
I know exactly how lacking our infrastructure is, and where it's been done better. The problem isn't that I don't know about other countries networks, it's that I know how high the tax subsidies are, how low our population density is, where it's distributed, and what regulations we've crippled our growth with. In those "better" countries, they've been spending tax dollars to build infrastructure. In this country, we've been spending tax dollars regulating them out of existence. They're creating monopolies, we're crippling industry to avoid the possibility of one.
The term natural monopoly exists because the theoretical maximum for productivity is a single, most efficiently run company stomping the shit out of the competition by providing a good or service better and cheaper. It's not something to fear and regulate against, it's something to hope for. If you want better service, educate yourself, think about what you've learned, and vote with your brain instead of a knee jerk reaction to some idiot that makes you feel good by labeling someone rich as the cause of all your problems.
This is, technically, true. This functions much like an enlightened dictatorship being the ideal government, in theory. (In practice, a dictatorship/monopoly is never benign/enlightened. At least, not for long. It's why we stick with democracy.)
The problem is human nature. Anyone in a position of complete dominance will be inclined to exploit it. After all, why bother being nice to your customers when you can just exploit them for all the market will bear? And it will bear quite a lot, if they don't have another choice. If you have total dominance over a market there are a great many alternatives to free and fair competition as a means of eliminating the competition. Temporary below cost prices, buying up the competitor directly, bullying suppliers into not selling to your competitor (by threatening to withold your own vastly more massive custom from them), the list goes on.
I readily agree that a free market is the best way to guarantee the best products at the lowest prices. The problem is that it's not just the government that can keep the market from functioning properly, a big enough company/cartel/trust can do the job just as well. I once heard the statement: "companies will be exactly as bad as they can get away with". While this is a rather pessimistic statement in most cases, there will alway be a couple who will do literally anything to get just that tiny bit more profit.
What we need the goverment for is to prevent easily exploitable situations (ie. monopolies), set reasonable minimum standards for environmental friendliness etc. and keep the heck out for everything else. [/rant]
I don't see why you're so outraged about this - a bandwidth cap with extra charge per byte over the limit is standard operating procedure in many countries.
I agree. The free market in practice, isn't perfect. It won't ever be perfect so people who think its the holy grail of all time, ignore or choose to overlook human nature. As to how much the government should be involved, that's a hard one that will never be agreed upon (although ignorant people might think a disagreement with their view is actually a lack of something instead of, well a disagreement). In theory, it could be but that's the way economic and political theories tend to be. And yes, history is full of companies that got away with as much as they could while they could and occasionally some stories about companies that progressed but certainly not out of the good for mankind but because it gave them an edge.
We have regulations against the anti-competitive practices. We then regulate further various industries that are predisposed to becoming those natural monopolies to prevent them from having the chance to violate the already standing laws.
I fail to see the point in crippling an industry to avoid a potential crime down the road.
Yes.
Other services have proven themselves fully capable of providing uncapped broadband access at speeds significantly higher than what TWC offers. (Verizon's FIOS is one good example) If consumers reject the proposed plans and TWC goes out of business as a result, it will free up the cable licenses where they operate and the existing infrastructure will likely be sold to a competitor that can provide what their customers actually want: High bandwidth and unrestricted usage at reasonable prices.
If you want to avoid the painful going-out-of-business part, you'll need to remove the barriers to entry that prevent potential competitors from setting up their own infrastructure. I'm sure if someone started building a fiber network in my area, TWC would suddenly find the upgrade funds they need somehow, possibly by searching underneath a few executives.
@ Daton:
I think you're looking at the wrong countries.
The point here is that taking action only after the "big guy" has exterminated any potential competition is counterproductive: it takes a lot more resources to break down a monopoly in an acceptable fashion (ie. no collapse of services) than just to prevent one in the first place. Not that that's an easy thing to get just right.
I also think that "cripple an industry" (and similar) is a rather harsh term that gets tossed around by the affected industry whenever even the slightest regulation takes place that they don't like. Businesses can adapt you know. The whole "lets get our customers to pay more" thing is just a way to avoid having to find ways to improve efficiency. (ie. exactly what the problem is with monopolies)
Fact 1 - All life is born from other life through reproduction (You have parents, your parents had parents etc etc).
Fact 2 - Archeological records show the further back in time you progress, the simpler organisms become.
Therefore...over the course of time, lifeforms reproduce resulting in more complex forms of life.
If you want to stick your head in the sand and believe Darwin was wrong about how that process occurs (even though the mountains of evidence to support his theory is overwhelming and any credible scientist will readily admit it), go ahead.
Bloody Creationists.
This topic will not devolve into a religious discussion. Any further attempts to derail it as such will be moderated. I believe in free discussion and the exchange of ideas, but this isn't a religious thread.
This is bollocks.
To all you people thinking "Gee, free country, internet companies should be able to do whatever they want"
Have you ever considered that the internet is a vital service for many people? Why do you think politicians make such a big deal about kids getting computers in schools? The internet delivers a fundamental good to the people, and that's information. Sure, we could live without it, I mean, just 20 years ago we weren't badly off.
But look at water? Electricity? Heat? These are PUBLIC utilities, regulated by the government to make sure semi-vital services aren't randomly cut off by some company that owns the only powerplant, the only oilheat, the only waterstation in the city. We learned a LONG time ago in the days of Rockefeller and US Steel that unregulated trusts and monopolies ARE BAD.
It's true- sometimes a single company in charge is the best solution, this is where you have GOVERNMENT REGULATION providing NECCESSARY SERVICES. Utility companies are regulated by the government. Police, Fire and Court Services- provided by the government. Road and Highway maintenance? Government. The engines of government RELY on the internet. Bad network infrastructure, gouging price schemes and other underhanded corporate taxes affects EVERYONE, just as much as if the electricity company did it. Should electricity companies be allowed to charge premium RATES for highend residential users? Industrial users? Corporate and government users?
It's time people stopped looking at the internet like it was some kind of fun gizmo only for nerds. These days it's a vital part of well, everything! How are you going to look at real estate? find a job? pay your taxes? bills? Without the internet, we're back in the 80s shuffling paper. Sure, it's possible, but who actually wants to do that? These days, using the internet is pretty much a valuable and required skill. Most businesses and governement organizations would completely collapse without it.
Broadband internet access should be available to everyone, just like public education. It is absolutely vital in building a healthy and modern society that is up to date with the latest world happenings and laws. It brings great benefits with few downfalls. (Copyright infringement, vulnerability to espionange) The world has staked it's future on the internet. To let people go without it is like...not letting them goto school.
The thing about government controlling big business is that these organizations are no longer individuals, but massive structures able to make life miserable or impossible for ordinary people on a whim. Armies of lawyers and creditors?
The argue for privatization is that privately owned companies do a better job at providing services. For things like..clocks, food, and various other consumer goods and services, this is true. But when a company fails at providing services neccessary for the public services, it's time that they be recognized for what they are- a public utility- and be run as such and in the public interest.
we also learnd that Rockefeller is in league with other of the worlds most wealthy private bankers that strip countrys of there rights becuase they controll the money : ex: Federal Reserve in America... who do u think backed all the major wars, ex: hitler, stalin, etc. all funded by the banks these people run and rule governments with the influence of money and how it can criple a country over night, ex: latest crash in america.
If you were right, you'd have a point. You're not, on any point. Standard Oil and US Steel were both good for the country, not bad. The price of oil products and steel dropped when they were at their height. We learned no such thing.
We did learn that they were bad for other companies. Unfortunately for all of the poorly educated idiots, extortion and bribery have absolutely nothing to do with monopolies. Businessmen with minuscule market shares get taken down by the judicial system all the time for those very things.
Your public utilities are the last things in life that you can count on working. Water mains break regularly because the pipes aren't replaced at a reasonable age. Power outages in these pathetic excuses for storms are normal because poles and transformers aren't replaced at a reasonable age. That buzzing sound in the radio is half your energy bill being pissed out of all the leaky transformers.
Law enforcement and rescue personel are equally decayed. There are thousands of firefighters that are physically incapable of doing their job because gender norming requirements allow 110 pound women to play at carrying 250 pound men down a ladder. Police response times are so high that they can't even get squad cars next door to a police station before the fire department will arrive from several blocks away with the added requirement of getting dressed in full gear first. They're underfunded, understaffed, and bad employees are impossible to fire short of an act of God.
Government control got you the internet of today. But you're so ignorant and stupid that you'll rant and rave about how bad big business is until they force the FCC to put them back under the crippling requirements that halted infrastructure growth for nearly a decade.
Zaisha, did you skim the thread or are you willfully blind? Time Warner has a cable monopoly in places because the government regulations created it. When you can rent someone elses network for less than it would cost to run your own, you'd have to be a fucking retard to build a competing network.
I have found that this is where most socialists and anarchists (two extremes) disagree. The core issue is that anarchists believe that the only "basic human right" is to try to live. Note that I say "try" to live. This means you have the right to try and make a living for yourself and support yourself and no one can force you to do something on threat of death and no one can kill you (as far as the law is concerned). However, if you want health care, you can earn it. If you want to eat, you can earn it. If you want an education, you can earn it. If you want a house, you can earn it.
Socialists on the other hand feel that everyone should get everything, whether they earned it or not. This means everyone gets all the basic things like food/shelter and they also all get the luxury things like internet, television, gym membership, restraunts, etc.
Of course, the problem with Socialism is that no one is driven to actually do any work because, why bother if you get treated exactly the same no matter how much/little you work. Anarchy has the problem that people who are unable to take care of themselves will eventually die and while humans got to where they are because of evolution, for some reason they largely believe that darwinism is a bad thing.
Of course, there are many other things that people argue about regarding both socialism and anarchy, but most of them either break down into this basic disagreement or are just incorrect arguments founded on either misunderstanding of the system or not thinking things through all the way.
Other countries survive quite well with a cap system in place. Society hasn't been destroyed there. They're not post-apocalyptic wastelands ruled by Warlords.
Just accept that the cap-free system that the US had is/was an outlier, and not the standard. It's not the one thing keeping the internet alive.
So, you're arguing that because the goverment had to force a company to go and provide any services at all somewhere, we would be better off if we just let the big boys do what they want? And not get any service to those areas at all?
Also, if another company is using their infrastructure, I would assume they're paying rent for it. (and that rent would certainly be based on both usage costs and an amount related to the current book value of TW's investments) And after paying that rent Earthling was still capable of undercutting TW's price and (presumably) making a profit. Why can they do this? Because a company has a lot more bargaining strength than the easily bullied individual consumer.
TW's alledged reason for this descision is that a couple of extreme users are using bandwith disproportionate to their fee, and this is causing financial problem. Nobody is saying that there aren't excessive users out there. It would be no more than logical to go after them, to make them pay for their much greater use, fair is fair. AFAIK energy companies (for instance) maintain special rates for industrial scale users for this very reason. However, TW apparently decided that it would be more profitable to implement a scheme that will affect all users, rather than just the ones that are the problem.
It should also say something about their reasoning that they chose to role out their new scheme primarily in areas where they have no/minimal competition. And I seriously doubt that the isolated areas that TW aparently had to be forced into contain a significant number of the problem users. (probably a lot less, both percentage and actual numbers-wise than the more commonly networked areas)
Maybe psychoak knows the history of the industry better than I do, but if I'm wrong I'm sure he'll correct me.
It's not a matter of the government *forcing* them to enter the marginal markets, it's that the government essentially *gave* them monopoly rights to build a system in that area. I know that's true here: the area cable system was sold to Insight, but each local government had to approve the sale. It's privately owned, but not in the sense you own your house. The governments in question (federal, state, and local) have veto rights on what they can and can't do with their network.
True, Earthlink is paying TW to use their network, but not nearly the actual cost of their use. It's a government mandated payment meant to take away from the "evil" (government empowered and subsidized) monopoly to give parasitic "little guys" a chance. To put numbers on it (no idea what the actual numbers are, and they would vary locally anyway) Earthlink (and others) may account for 30% of the internet traffic over TW's network, but they're only paying 5% of the upkeep on that network. TW eats the rest of the cost, even though they're not making any money on it.
A competitor has no bargaining position whatsoever, except that the government MANDATES that TW has to share their network at a loss. That's the real problem.
I recently saw an estimate (don't remember where, maybe I'll find it in my browser history when I get home) that internet traffic volume has increased to 17 times the 2000 level. That, with the built-in disincentive to update the network, is what's causing the problems.
Energy companies actually have the reverse of this situation. Yes, they have special rates for industrial customers, but they are LOWER than the general public (usually with the condition that they can be blacked out at peak load times). For electricity, steady dependable consumption makes a good customer. For the internet, steady high use is considered the bane of the industry, because they'd rather cap those customers than upgrade their network.
Assume nothing where government regulations are concerned. The typical method governments use when determining acceptable charges for a regulated monopoly is to simply take their operating costs and tack on a margin, generally between five and ten percent. This is why upgrades are rarely made. An upgrade isn't part of the operating cost, even maintenance is rarely factored into the costs, which is why transformers have to blow up before they get replaced in a low population sector that isn't complaining about the televisions and radios not working.
But, you're in luck! The 1996 Telecommunications Act is very easy to read so you don't have to assume. Well, relatively anyway. Unlike state and local governments, Congressmen violate their oath of office every time they create a regulatory body that does their legislative work for them, so all the act does is give the FCC guidelines. Which is why that regulation was tossed in 2005 on their third review as they finally realized they'd destroyed the growth of the broadband market by regulating cable the same way they do the telecoms. They found a loophole in their own regulations and declared the cable industry a different entity altogether.
Since you haven't educated yourself by this point, you probably wont learn anything even after I tell you. But, I've nothing better to do while this query finishes so I might as well. It says, explicitly, for interconnection and network element charges, that cost of providing the interconnection or network element only shall be used to determine the rates charged, rates of return are explicitly disallowed.
Yes boys and girls, that's right. Rates of return on the costs of building and maintaining the network are excluded. So what if the company spends ten million dollars building infrastructure and has to replace a million dollars in equipment every year, if it costs fifty cents in power and two bucks in wages for them to carry someone elses traffic, well...
If I appear disgusted with you, it's because I am. You assume, without educating yourself on the subject to even a minimal degree, that Time-Warner is at fault. You assume that the regulations take into account various common sense costs when designing competition requirements. You assume that government is functional despite not having a single example of efficiency to point to, yet deride the private sector by default in spite of all the advances from that private sector that you're using as you post.
All of you regulatory retards need to get a fucking clue and get off the bandwagon before Congress screws us into the ground for another decade just as we're finally starting to catch back up.
Edit: Bastard! No posting while I'm reading regs... Seriously, it's 128 pages long with a nondescriptive numberless table of contents...
Edit again: Fuck I need to proof-read better.
Interesting, I had no idea the American regulations were that messed up. (and I thought the politicians were inefficient over here...) However, that means that TW's real beef is with the government. So why aren't they using their lobbyist to get the offending clauses changed rather than taking it out on the customers? (though I doubt the goverment will be very suceptible to requests for change)
I probably shoudn't have been lured into going deeply into the specific case at hand rather than sticking with the anti-monopoly point I really wanted to make. The point I want to make still is that a monopoly, by definition, (and regardless of how it came about) discourages investment and innovation, while encouraging steep price increases.
To be honest, it would probably be more effective to have unprofitable sections of the infrastructure run by a government owned ultility company. (not my first choice for anything, but it tends to be the best you can get for unprofitable stuff)
Quite frankly, a state sponsered private monopoly in anything is probably the least efficient system imaginable. You get both bureaucratic inefficiency and corporate greed mongering.
Oh, and please forgive my instant paranoia towards corporations managing infrastructure. We had a number of previously government owned systems turned over to the private market here over the last couple of decades. This was supposed to provide better and cheaper sevices. Of course what happend was structurally increasing prices and decreasing service. Oh, sure competitors were introduced, but they were small and anyway shared interests with the big boys.
And TW is still at fault for going after everyone rather than the major trouble makers. Whenever I see the average person get screwed for things the big boys do (and I rate the goverment and big corporations as being nearly the same thing) I get a little peeved. And it hardly changes the fact that monopolies are a bad thing. Whether state exacerbated or not, monopolies are the most effective way of screwing over consumers.
Incidentally, when you think about it, the government (of any country) is really the biggest monopoly around. It has a monopoly on legislative power, it has a monopoly on the use of force (police, army, laws covering self defence....) and so on. Heck, it is even the king of monopolistic price-fixing in that they get to decide the rates you pay for your services (ie. taxes) and you have no choice but to cough up. They also have a board of directors (ie. politicians) that are (by and large) massively uninterested in changing the status quo in any meaningful way. Sadly, they seem rather less interested in pleasing the general meeting of shareholders (ie. the voting population). Or maybe they are just doing the same thing as some other big-business managers, fiddeling with the numbers to screw everyone over while securing their own bonusses. (ie. re-elections, post term gravy trains etc.) There is even quite a lot of crossover between the business old boys network and that of the goverment.
The offending causes have already been changed. Cable internet services were removed from those regulations by the FCC in a clever act of nullification by reclassifying them as an information service instead of a telecommunication service. The problem is that was only lifted in 2005. They've been crippled since 1996 or longer, and some of them still are thanks to state and local regs keeping them nailed down anyway. The infrastructure is already far behind current technology. Cable is only a marginally competitive service as it is, satellite TV will likely replace them even in large cities where they are most efficient, and FIOS and Wi-Fi networking is both cheaper and faster. Broke, uncompetitive, in a defunct industry, they're already dead.
As to the privatization of government run services, perhaps your costs were just hidden from you in the tax structure and when they switched to a privatized system, the rates were too low to sustain the company created. Did you check on it or just assume you were getting reamed? Finland is spending 100 million this year in tax dollars to do a two thirds cost share on broadband infrastructure improvements, I have no idea what all they spend outside of that project. The consumer is still paying for it, just not on the bill, and regardless of whether they use it or not. For such an accurate depiction of government at the end of your post, you're awfully willing to cede power to them.
As a general rule, the large an organization, the worse it performs. This is why some economists are skeptical of the need for restricting the formation of monopolies, when left alone, large companies tend to self destruct after a certain point. The list of major corporations that are or have declined after reaching critical mass is endless, even Standard Oil was already in decline when they were broken up and made more valuable than the whole. The same holds true for governments, the larger they are, the more inefficient they are. We were originally founded as separate states with a weak centralized power to cope with the problem. The federal government has since abandoned federalism and made it's own name an oxymoron.
As a country with 300 million people spread across a land mass that makes the Netherlands look like one of our individual states, and not a particularly large one, it's logical deduction to assume that we're even more fucked up than you are in these areas.
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