Metered Internet?

| Comments (2) | Networking
At the FCC hearing yesterday, there was a lot of talk about metered Internet. (See also Rob Malan Rob Malan arguing that net neutrality legislation will inevitable result in metered Internet service). It's certainly true that metered Internet is one possible outcome of network neutrality regulation, but I'm not convinced that it's the only one. It's interesting to note that at the same time as we're arguing about this, all the major wireless service providers (which have historically been incredibly stingy about per-minute charging) have recently rolled out unlimited voice offerings.

Now, you could certainly argue (as Rob's argument implies) that there's an upper limit on how much bandwidth can be used by voice and so as the technology has improved, it's become cost effective to offer unlimited voice service, but that the bandwidth consumed by video will be much greater. On the other hand, just last year Apple pushed Cingular/AT&T into offering an unmetered data plan for the iPhone, and apps like YouTube for iPhone clearly encourage users to consume larger amounts of bandwidth than they would if just checking their email. Now, obviously the cell providers have a lot of latitude to manage the data portions of their network, but it still seems to me that there are a lot of factors in play here and that metered Internet is not the only possible outcome, even in a more highly regulated regime.

2 Comments

You know, here in Sweden we have had unlimited data over 3G mobile phone networks for quite some time now. At around $30 it is a good deal and certainly an alternative to land line connections. The speed is good (around 3-7 mbps).

Does anybody remember all the whining when the WWW exploded and slowed down other internet services to a crawl as it hogged all the bandwidth? Was the solution to have the users pay extra for WWW bits?

I think metered pricing IS inevitable.

All-you-can-eat voice is a pretty high premium, and unless you are a REALLY heavy user, you are probably cheaper doing pay-per-call.

The iPhone is an interesting counterexample, except that a lot can be transcoded, especially the Youtube.

BitTorrent uners are orders of magnitude worse. We witnessed it at ICSI when a couple of users violated policy over the weekend and transfered 20 GB+ through BitTorrent.

Additionally, all the P2P models for bulk legitimate data are cost-shifting: shift the cost from the content provider to the recipient or his ISP. Since ISP bandwidth does cost significantly more than content provider bandwidth (5x-10x), if any congestion occurs in the ISPs network P2P represents a huge drag.

This can be solved either by demand-based pricing or user-fairness shaping (shape to enforce user fairness on a notion of second/minutes/hours). Because adding more bandwidth only really benefits the heavy users which, in a flat rate pricing model, represent a drag.

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