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Comment by dunpeal | Hacker News Reader

"Our consumers are using dozens of entertainment devices for free" raged electric power providers. "They watch films, play video games, and even binge-watch Netflix shows for hours, using our power for which we receive no special compensation. Why should we sell electricity for a fixed price for all purposes? Clearly, we should be able to charge premium fees for premium uses! Our customers couldn't watch Netflix without our power, yet Netflix pays us no fees for supporting its business model. Where's our rent, err I mean, proper piece of the action?!"

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In the early days of electrical service, this sort of price discrimination was common. There were often separate pricing structures for consuming energy used for electrical lighting and "power" (everything but lighting). I presume that's why so many electrical providers are still named "X Light & Power" -- electrical light and power were originally sold as distinct products.

Report of the rates for lighting and power service. National Electric Light Association., 1903:

https://babel.hathitrust.org/cgi/pt?id=nnc1.cu56609884;view=...

See for example page 9:

"Norwich, Connecticut:

17.5 cents per kWh for incandescent lighting. 10 cents per kWh for power. Discounts ranging from 5% on lighting bills of $10 to 20% on bills over $20. Discounts on power bills range from 10% on bills of $10 to 70% on bills of $400 to $600."

Note that the electrical lighting prices start higher and also have lower discounts for high-volume consumption.

Fortunately, the adoption of standardized electrical outlets made this sort of price discrimination less practical over time. Also fortunately, the providers didn't have any sort of fancy Deep Power Inspection systems to determine when a consumer buying "power" was beggaring the provider by converting power to light.

Best analogy I've seen so far. Wonder if it could be improved by substituting an ISP instead of Netflix.

Many states have laws that force electricity distributors and producers to be legally separate entities. So for example an electric producer that is closer physically or offers the distributor more value by producing at the right time could be favored by the distributor.

In other words the private electric company being compared to that has a vertical monopoly on both facets production and distribution basically doesn't exist.

Dont joke about that. With smart meters such a money grab is not unimaginable.

why should a power company sell electricity at different rates depending on what time of day it is?

Because they want to discourage heavy usage at peak time, when they are running at, or close to capacity. It's certainly not unheard of for transit providers to do the same thing.

Power from peaker plants and pumped storage are more expensive than power from base load generators.

As solar gets cheaper and cheap that will obviously impact times when excess power is available (actually already is).

Bad analogy, since the ISP lays a (figurative and real) pipe between Netflix and the user; this isn't correct for electricity.

And the delivery of electric power doesn't require any infrastructure, pipes, wires, etc?

An odd argument by an account created right after this story was posted...

What I mean is that Netflix pushes the bytes from one side. Bosch doesn't push electricity from one side to make my Bosch washing machine work for example. (Which highlights another reason this analogy is bad: the electric company gives you power which they have to generate themselves, while an ISP is pipes)

Naw, dawg, this is what you replied to me originally:

> Bad analogy, since the ISP lays a (figurative and real) pipe between Netflix and the user; this isn't correct for electricity.

Most readers can just glance out the window and see various manholes stamped with the name of a power company. These are the very real pipes you claim do not exist.

Your argument is blatantly false.

Now you came up with a new argument: that Netflix "pushes" bytes. I have news for you: Netflix is already paying for internet connectivity to "push" these bytes. Anyone renting even a single internet server does.

Are you just throwing stuff out there, hoping something sticks?

Together with the suspicious timing of your account creation, you don't seem very objective or genuine.

Netflix is paying an ISP to be connected to the internet. The Netflix user is paying an ISP to be connected to the internet.

Now the ISPs want paid again to provide the service they're already being paid to provide at both ends of the pipe, to make sure the pipe works properly? Extortion plain and simple.

A suprising number of power companies have little generation capacity themselves and instead buy it, so they are last mile pipe owners like an ISP.

No they don't. They lay a pipe between the tier one network providers and the user. It's the tier one providers (who by the way are not part of ISPs, nor have an issue with net neutrality) who lay the pipe between everyone (google cloud, netflix, ISPs, etc.) and create "the internet" as we know it. Everyone pays these tier one providers for access, Netflix pays (a quarter of a billion if I remember correctly), ISPs pay (that's part of why you give them money). The ISPs only run the last mile pipe from a tier one provider who provides access to "the internet" (which is the other reason you give them money).

So if you view "the internet" as a singular type of utility like electricity then the analogy works. It's also how most people (correctly as it happens) think about it. IF the internet didn't behave that way it would be a very different place, where things like cloud providers, emails, and link aggregates wouldn't and couldn't exist.

The real problem is you only have one choice of ISP in most areas. If the ISP markets were competitive this likely wouldn't be a problem, because all the ISPs would be offering "the internet". But now the ISPs are trying to use their market position to extract additional money. It's called economic rent, and we've basically known it's a bad idea (economically and morally) since feudal lords were doing it (cough a certain tea party).

Any consumer ISP worth using should themselves be a tier 2 network, which means that for full global routability, yes - they take transit from peering with at least one tier 1 provider, but the bulk of their transit will come via peering at neutral internet exchanges - paying just for per-port costs and potentially membership fees.

They are also then free to peer directly with Netflix, who have an open peering policy: https://openconnect.netflix.com/en/peering-locations/

If you're pushing enough traffic, Netflix will also send you an Open Connect caching appliance for free: https://openconnect.netflix.com/en/appliances-overview/

The point remains that Netflix is paying companies to build internet infrastructure on their behalf. Netflix is building their part of the infrastructure. ISPs are being paid to provide connectivity to the whole internet, not to lay pipe specifically to Netflix (which Netflix make easy of course).

And Netflix is already paying their ISPs. All traffic has been paid for. What's the actual problem?

>What's the actual problem?

Greed. Maximize shareholder value. So they'll use circular, trump-like arguments to justify killing net neutrality.

These ISPs conveniently forget or omit the fact that without Netflix or YouTube, most customers would be fine with 2-5Gb a month of data - i.e. they'll make much less from their customers.

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