Re: An Attempt at Economically Rational Pricing: Time Warner Trial

[Scott McGrath <mcgrath () fas harvard edu>]

Why does the industry as a whole keep trying to drag us back to the old 
days of Prodigy, CompuServe, AOL and really high rates per minute of 
access.   I am old enough to remember BOS>c202202  <return>   

The 'Internet' only took off in adoption once flat rate pricing became 
the norm for access.   Yes there are P2P pigs out there but a more 
common scenario is the canonical "Little Old Lady in a Pink Sweater" 
with a compromised box which is sending spam at a great rate.    Should 
she pay the $500 bill when it arrives or would a more prudent and 
rational approach be like some universities do.

i.e. Unthrottled pipe until you hit some daily limit like 1-2 gb and 
then your pipe drops to something like 64k until midnight or so.    This 
keeps the 'pigs' in line and you might want to add a   SUPER tier which 
would allow truly unlimited use of the pipe for $200-300 because for 
some people it would be worth it for them.      It's  human nature  to  
desire a degree  of  predictability
in day to day affairs and as another poster noted that's why prepaid 
phones are popular now.   Further with the compromised system analogy I 
purchased a prepaid phone for my wife who is a teacher so in the event 
it was stolen at school the financial loss would be limited to the 
prepaid balance, no multi-thousand dollar bill for overseas calls.  "You 
used the  minutes (bandwidth) didn't you?".

Ultimately there is no option but to build out the network as we have 
found on the university side of the house as digital instructional 
materials and entertainment delivery over the net will
become the norm instead of sending bits of plastic through the mail 
(except for luddites like me ;-}).

Patrick W. Gilmore wrote:
> On Jan 18, 2008, at 3:11 PM, Michael Holstein wrote:
>
> > The problem is the inability of the physical media in TWC's case 
> > (coax) to support multiple simultaneous users. They've held off 
> > infrastructure upgrades to the point where they really can't offer 
> > "unlimited" bandwidth. TWC also wants to collect on their "unlimited" 
> > package, but only to the 95% of the users that don't really use it, 
> > and it appears they don't see working to accommodate the other 5% as 
> > cost-effective.
>
> I seriously doubt it the coax that is the problem.
>
> And even if that is a limitation, upgrading the last mile still will 
> not allow for "unlimited" use by a typical set of users these days.  
> Backhaul, peering, colocation, etc., are not free, plentiful, or 
> trivial to operate.
>
>
> > My guess is the market will work this out. As soon as it's 
> > implemented, you'll see AT&T commercials in that town slamming cable 
> > and saying how DSL is "really unlimited".
>
> I do not doubt that.  But do you honestly expect the at&t DSL line to 
> provide faster / more reliable access?
>
> Hint: Whatever your answer, it will be right or wrong for a given time 
> in the near future.