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> without being able to efficiently price the scarce resource via bandwidth caps and segmented pricing models on the consumer side

First of all, the situation in the US is different than in the UK, as I understand it. I don't know the details of how ISPs are able to price in the UK, but in the US, the ISPs can price however they want to, and many of them have what is essentially monopoly access to their markets, so the pricing scheme that is in use in the US, with mostly flat rates and very little segmentation, is, I am sure, to the ISPs' advantage, whatever their publicity might say. I suspect that the flat rates are set so that, while people who use full video streaming bandwidth regularly might be subsidized to some extent, people who use much less bandwidth (like me), are paying far more than we would in a true free market, so that on net, the ISP is making much more profit than they would if they truly had to price by bandwidth actually used.

>the ISP is reduced to negotiating with the upstream providers of packets that are consuming the scarce resource on behalf of their customers.

No, they are "reduced" (at least in the US--again, I don't know what the situation is in the UK) to trying to get upstream providers to pay for bandwidth that their downstream customers, on net, have already paid for (as above). The logic of giving ISPs exclusive access to particular geographical areas (in the US) in the first place was that they would be able to count on a steady revenue stream to fund buildout of the necessary bandwidth. They have now had that benefit (in the US) for at least a couple of decades. If they are complaining that they need upstream providers to pay to fund more bandwidth, that tells me that at least one of two things is true:

(1) The ISPs have not used their monopoly revenues for the purpose intended: instead of keeping pace with bandwidth needs, they have just been pocketing the cash; or

(2) The ISPs actually have the bandwidth, but they are using their monopoly position to control access to it in order to get paid twice for the same thing.

(My personal opinion is that it's a combination of both.)

> I would expect our home usage is now well in excess of 1T/month. (I live in the UK.) This should tell you that I have no self-interest in bandwidth caps, especially joke 2-figure ones.

Ah, so you're on the receiving end of the subsidy, in a big way. Wow! That's what, five or six people streaming a full-length movie apiece, every day?

The structure that ISPs seem to like, of a cap with a fairly stiff charge for exceeding it, doesn't appeal to me either. But I don't see what would be wrong with a baseline connection fee plus a modest charge per GB, such that streaming a whole movie would cost on the order of $2.

(Message heavily edited after I realized you agree that the subsidy is unfair.)

My GF usually works from home and has video on one screen 10-16 hours a day, and concurrently streams to a tablet for about 2-6 hours a day - some of that is concurrent usage, but she also likes to fall asleep with the tablet on (and plugged in).

Netflix HD "best quality" apparently uses 2.3G/hour, as of 2012. If all the streaming was Netflix HD in best quality, she'd be using over 1.5T all by herself.

However, it's not all Netflix HD, so her actual usage is lower. And she's also a fan of various talent reality shows, which she sometimes acquires from other sources.

Increased bandwidth is similar to increased road capacity. Just like road capacity makes longer and more car trips feasible, increased bandwidth encourages accessing large files remotely and reduces the incentive to cache locally.

Good grief. That's a pretty good argument for metering. I guess people just don't get that it's not the same as TV. Why should they, when it's billed at a flat rate?

If they sell you a 100Mbit/s line with unlimited data, it should be illegal to charge you again if you use all that potential... either directly or indirectly.

> If they sell you a 100Mbit/s line with unlimited data, it should be illegal to charge you again if you use all that potential... either directly or indirectly.

(QFP) It's "thinking" like this that's responsible for a good 40% of the outrage over net neutrality, IMO.

The argument about whether "unlimited data" really means unlimited data is a completely different discussion. It has nothing to do with net neutrality, it's a discussion about false advertising.

I think it is connected since it is all the same network traffic... they do false advertising on bandwidth, which is like the first hidden charge (using small prints, maybe) & and then try to do a second hidden charge for every bit by charging clients first and servers later (Netflix for example)...

Only a child could read "unlimited data" and think it meant unlimited data. Your network speed is finite; multiply it by time and you get the maximum amount of data you can possibly download. This is a hard limit that cannot be exceeded, and it is well short of "unlimited".

What grown ups understand "unlimited" to mean is that there is no bandwidth cap. There is no hard limit on number of bytes downloaded, beyond which the connection stops working until the next rebilling period.

But this doesn't get rid of the underlying problem. Thinking that it does, that it's just an advertising lie, is magical thinking unfit for adults.

Without a bandwidth cap, other mechanisms need to be used to deal with the fact that consumer internet is sold via contended lines. Some packets will need to be dropped; available bandwidth must shrink when there is more contention. What decides which packets get dropped and which ones get priority - complete randomness, or should your phone call be less important than the difference between a 1.9M/sec video stream and a 2M/sec stream? This is exactly where network neutrality comes in. It's a different way of dealing with the scarce resource, the contended lines.

So it is not a completely different discussion. It is in fact the same discussion, from a different angle.

Here's an alternative viewpoint.

Power companies have the exact same problem. That being said: how do power companies solve it? They make absolutely sure they have enough extra capacity - because if they don't people complain, loudly.

So: Here is what I read "unlimited data" as: The service provider has enough capacity that a customer has access to at least their full subscribed service normally.

In other words, I am challenging the preconditions of your response: I do not believe that consumer internet should be sold via lines that are contended to the point that "brownouts" (that is having bandwidth of < subscribed rate) are a normal occurrence.

> Power companies have the exact same problem.

Not to anywhere near the same extent. The range of power consumption of residences probably covers less than an order of magnitude. The range of bandwidth consumption of residences probably covers several orders of magnitude.

> how do power companies solve it?

By charging people for power consumed, directly. Power companies don't have flat-rate, unlimited-use plans. Everyone knows that if they use more electricity, they pay more, and if they use less, they pay less.

> if they don't people complain, loudly.

Yes, because electrical power is a necessity in a way that Netflix-level internet bandwidth is not.

> I do not believe that consumer internet should be sold via lines that are contended to the point that "brownouts" (that is having bandwidth of < subscribed rate) are a normal occurrence.

ISP's do have customers that get that kind of service. Those customers are called "businesses", and they pay significantly more than residential customers do, because they insist on actual service level guarantees.

> If they sell you a 100Mbit/s line with unlimited data

No ISP that I'm aware of does that. They might sell you a line with a "nominal" bandwidth of 100 Mb/s, but when you read the fine print, that really means "as long as nobody else is using the network at the same time", or something like that, plus a lot of other qualifications and hedges and disclaimers. The ISP actually is making no guarantee whatever about the actual data rate you will get.

edit: missed the "unlimited" bit, i agree if you're buying an "unlimited" service, there shouldn't be an artificial cap

why not? if I only want to use a small amount of bandwidth per month, why should I pay the same as someone who uses 10 or 20 times as much? (I don't only use a small amount, but that's why i sprung the extra $10 a month to go from 500GB to unlimited)

having grown up with segmentation on both speed and quota, i struggle to understand why there's such opposition to the idea