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The Internet

Why Not To Meter Internet Access 265

A reader writes: "Many experts, especially pundit Bob Metcalfe, have argued that Internet access should be metered so that light users don't have to subsidize flat rates for heavier users. John Levine, author, expert and sewer commissioner, argues that this idea of metering the Internet flies in the face of 100 years of history."
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Why Not To Meter Internet Access

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  • U PUNCTUATIN': BAD

    U SPELLIN': AWFUL

  • by Russ Nelson ( 33911 ) <slashdot@russnelson.com> on Friday October 06, 2000 @06:01AM (#726358) Homepage
    John is too modest -- he was also involved in creating AIX for IBM. He's much more technical than he's usually portrayed as being (particularly when he writes Dummies books for Windoze lusers).
    -russ
  • by Dreamland ( 212064 ) on Friday October 06, 2000 @06:01AM (#726359)
    You pay a flat rate to be able to be online 24/7 if you so wish. There's no logic in charging per megabyte to lower the rate for the casual user. Besides, many Ethernet networks are switched these days, so every user has a nominal capacity no matter how much/little bandwith he uses.
  • Yes, actually. My cable provider (thankfully not @Home yet) charges $0.02/MB over the 6GB limit. But essentially it's still a flat rate of $30/month.
  • by mgriego ( 35430 ) on Friday October 06, 2000 @06:03AM (#726361) Homepage
    Local phone companies don't charge metered rates for phone access, why should internet access companies? I'm a real light phone user, but I don't complain about paying $30/mo because someone else is on the phone 24/7 tying up more phone bandwidth.

    --Mike
  • by gattaca ( 27954 ) on Friday October 06, 2000 @06:04AM (#726364)
    The cost of letter-delivery used to be calculated according to the distance the letter was going to go. One of the first things that Babagge did (way before he designed the difference engine) was point out that it cost more to do the calculation than it did to deliver the letter. Hence the flat rate stamp was born.
    I would have thought that the same sort of thing is probably true for Internet access - especially since sending data down a wire is just as expensive as not sending data down the same wire, once the wire has been laid.
  • by Nidhogg ( 161640 ) <shr,thanatos&gmail,com> on Friday October 06, 2000 @06:04AM (#726365) Journal
    What the article fails to point out is the benefit to the company on having a flatrate billing plan. You have an account. You pay this much. We care not what you do with it.

    Instituting any metering system will raise the operating costs due to the trouble it takes to track usage.

    And how exactly would you do that anyway. Total bits per month? Total online time?

    Too many variables and way too open for abuse by unsavory providers. There's little wrong with a flat rate system IMHO.

  • Why pay for internet access, when you can get it free?

    Same reason I don't use CueCat. There are things (like domain names and internet access) that you should pay for even if you could get for free.

  • In packet networks (postal system, internet, etc) the cost to transmit doesn't rise proportional to the number or size of the packets but as the number of switch point.
    --
    An abstained vote is a vote for Bush and Gore.
  • I still believe that the internet should be provided free, not at $20 a month, or 8cents a minute, or whatever the current rate may be.

    And when you can find a web provider who's going to provide service for free and take a loss out of the goodness of their heart (and not go out of business like most dotcoms), let us know.

  • The whole point is that it's NOT nonsense. Some people may be willing to pay more for th same internet access, which is precisely what the article says.

    And some people would pay less with a metered plan. Byt a lot of people (includeing me) don't like the restrictions of those, where you will be charged extra if you go over a certain limit. It's nice to no there's no such limit, even if I would have never gone over in the first place. And they always make it seem like it's only a few bucks more...

  • by Greyfox ( 87712 ) on Friday October 06, 2000 @06:08AM (#726381) Homepage Journal
    MCI'll be happy to lease you an E1 for $2000 a month. As packed as places like London are, I'm surprised people aren't slinging ethernet out their windows and setting up Microwave links.

    Anyway, I suppose that really was your $.02.

  • by mp3car ( 179460 ) on Friday October 06, 2000 @06:09AM (#726383) Homepage
    Now I need to decide if its worth .05 cents to refresh slashdot to see if there are any new items of interest! Yes, lets destroy a system that works well for the masses to benefit those who cannot use AOL correctly.
  • If you're serving and/or using tons o' bandwidth, then maybe it's time to charge by the megabyte per month.

    However, for the end user, connecting through an ISP and simply surfing et al this is just downright dumb. For one, it would require additional cost to monitor users. Second, it would discourage people from surfing as much. Third, you can say bye bye to banner ads (though maybe that's a good thing), if people have to pay for every bit of those pieces of trash they see they are going to block them. And finally, it would be moving away from closing the "digital devide". If little Timmy can't do something internetish because his parents need to spend their money on food instead of for the excess usage, then little Timmy is at a disadvantage.

    Also, once you break down the essential "everyone pays the same" wall, what's next? If you access certain "more expensive" sites, will you be charged more. Might things begin to revert to the long distance phone call paradigm? I doubt it, but it's a very very chilling thought.

    Flat rates are simpler, easier to use and understand, and make a lot more sense in the semi-egalitarian environment of the internet.

  • Note that with the cable service, it's still a flat rate, but there's merely a punishment for abusing the system. It's like getting a ticket for speeding. Someone who transfers 1GB still pays the same as someone who barely uses the service.
  • by TheTomcat ( 53158 ) on Friday October 06, 2000 @06:09AM (#726386) Homepage
    I pay on my DSL connection right now.

    I get 5 gig/month (which is ACTUALLY 5,000,000,000 bytes, not 5 gig). As the base package, and after that, I pay 7cents per megabyte(1,000,000 bytes).

    So, if I download in excess of 5 gigs, it costs me an additional $70 per pseudo-gigabyte. Fortunately, I don't use that much, but my ISP offers a larger package of 20 gigabytes for an additional $20/month, but you must already be on the plan to take advantage of the package.

    Why don't I use another ISP? NBTel is the only ISP in the province that will provide DSL.

    (note: 7c/meg WAS the rate, I'm not 100% certain that it's still that high, but I haven't heard otherwise).
  • by RhetoricalQuestion ( 213393 ) on Friday October 06, 2000 @06:10AM (#726390) Homepage

    If you had a choice between an all-you-can-eat buffet, and an a la carte restaurant, both of which served the exact same food, and had the exact same level of service, what would you choose?

    Sure, some people would say that they the buffet isn't worth it because they don't eat very much, but 90% of everyone I know would hit the buffet. And even light eaters binge sometimes, or go for the buffet because they don't know how much they're going to eat.

    So the buffet restaurant makes major profits and the a la carte restaurant goes out of business (or starts offering a buffet, to stay competitive), which forces everyone to go to the buffet if they want to eat.

    And then the light eaters of world whine about how buffets just aren't worth it for them, and want a la carte restaurants. But the restaurant owners already know that a la carte just isn't profitable enough, so they continue to stick to the buffet.

    Who has the .sig "kids love the rich taste of content?" (or something like that) It's so appropriate here.


  • ..because here in Europe, we know what metered Internet access is like and we don't like it [unmetered.org.uk]!

    D.

  • Unfortunately most of us live in capitalist societies where the price of something is based on the market demand for that something and has very little to do with the actual cost of that something.

  • One of the local providers to Ithaca, NY, Lightlink Internet [lightlink.com] does that already. They offer high speed radio, DSL, etc... and you pay a reasonably small per month fee, and you can pull the maximum bandwidth that your connection physically allows, but you pay $10/Gigabyte over 1 gigabyte per month, so that way you can get quick downloads by using lots of bandwidth in short bursts, but if you don't pull down too much, you don't pay much. If oyu want to download a shitload of stuff, you pay more. It works well, the company I work for uses the service, and it's worked out quite well.
  • They did it in Newfoundland when I lived there. You could pay more for a higher cap, implementing the features of the cable/DSL modem. The service got better for everybody except the warez kiddies.

    QoS is a great way to smooth out a network as well. Yesterday, I had to stop a download because our provider told us we were "bogging everyone else down." Unless I implement QoS on my laptop or our router, I can't control how much bandwidth I'm using for a download. I think the ISP should be doing it, rather than calling up people and telling them to stop using their connection.
  • I've always thought metered plans were stupid. For $40/month I get both a speedy cable modem connection and cable tv. My phone bill was costing me, before I cancled my phone, $50 a month (using a free Internet account I had at the University) and I don't use long-distance. The crap I was getting with the phone was random charges added on overtime for stupid things I didn't even use. That is what metered access gets you. Even if you opt out of long-distance you still pay taxes for it. With my cell-phone I pay $30/month flat fee and get more minutes than I'm likely to ever use, get caller id, voice mail, etc plus the benefit of being able to carry it with me. Oh yeh and free long-distance should I ever want it. If they start metering or taxing the Internet I'm sure myself and others will break away and make our own Internet that is free of government hassles. What they can tax they can track. I don't want any eyes watching me 24/7. The idea of charging for emails sent has always made me laugh. In the days before the Internet where they actually did charge for email I never used it. Now if they tried to charge I'd have to wonder how they'd record my Linux box sending messages. If they decided to monitor and tax just those packets people would simply change protocols. Silly wabbits.
  • by Dreamland ( 212064 ) on Friday October 06, 2000 @06:14AM (#726400)
    You didn't get my point. If you're on a switched Ethernet, and pay per megabyte, you would be paying the ISP for utilizing bandwith which you have already payed for, and noone else can use anyway. Sort of like buying a book, and then paying the publisher for every minute you're reading it. That's nonsense.
  • by mindstrm ( 20013 ) on Friday October 06, 2000 @06:15AM (#726401)
    Sure. That makes great sense. That's what @home tries to do.
    EXCEPT: they tell you NO SERVERS, it may use too much bandwidth.
    NO UNATTENDED USE. This is for casual web surfing only.
    WE RESERVE THE RIGHT to terminate your connection if you exceed 5GB/month.

    So yes, I'd much rather pay for my bandwidth per byte and have them fuck off and quit telling me what to do.
  • What will happen in a few years when we have the technology to stream all media over the internet (ie. TV, Phone, Radio, etc.)? We have the power to use all those mediums however they suck up large amounts of bandwidth. Now in the future what if this "casual" user decides he wants his TV to be recieved over the internet rather than traditional means. It's going to cost him an arm and a leg to stream the TV over the net if he is paying per megabyte!

    Personally I think such a system might be cheaper for the regular user in the short term, but when all things digital are converged then I think the system will break down.

    Maybe this is just a plot by the RIAA to stop people from downloading MP3's? They might be thinking they can get a percentage of all internet traffic costs sort of like they get a percentage of blank media in Canada? Maybe I should be quiet before they get some ideas.
  • Yes, and like the article says that's one of the reasons adoption of the Internet has been slower there.

    Everything is written from a clearly American perspective. They aren't "consumer" but "American consumers". Why try and bash it for this?
  • by diacritical ( 238830 ) on Friday October 06, 2000 @06:18AM (#726410)
    unless I can get a rebate on every byte/time unit spent downloading spam, cookies, and other advertizing I didn't want to transfer in the first place. :)
  • by adipocere ( 201135 ) on Friday October 06, 2000 @06:24AM (#726416)
    Let's listen to some of his brilliant logic on why we should not have metering.

    "Users love low flat rates". Gee, what a shock. People like free almost anything but herpes. Of course they want it for free. I'd like my car to cost $50, too. So what?

    "...nearly all users pay flat rates regardless of their usage..." Not exactly. Dialup has an absolute bandwidth limit, there is only so much I can download over a 56k per month. ISDN has a higher limit, cable higher still, DSL, T1, T3, and up to OC48 (I suppose something exists beyond that). The rate I pay per month determines a ceiling on my usage.

    "...metering would fly in the face of hundreds of years of history..." like metered mail (or stamps), pay by minute for long-distance telephone calls, and that is in the communications arena alone. We still have metered gas, electricity, and so on. Sounds like history is on the metering.

    I don't even know where he was going with this content thing. It doesn't appear to be relevant. Maybe I'm wrong.

    "Price discrimination..." way to coin a phrase that will automatically bias you against metering! Maybe he should have just used "Nazi Price Fixing" and been a little less subtle.

    "...residential telephone users can get flat rate plans with free local calls..." Said flat rate varies wildly. How much you want to bet that if everyone got on the phone and began babbling 24/7, our "flat rates" would suddenly undergo an upwards shift?

    "...one can add extra fiber capacity without limit..." conveniently ignoring the cost of the fiber, installation, repeaters, etc. That money has to come from somewhere. Until Slashdot posts a nice biotech story on trees engineered to grow fiberop, I won't be holding my breath on adding fiber for free.

    "...When necessary, ISPs can discourage camping via monthly caps, limits on session length, or limits on peak time usage..." Oh, I see. So, instead of having the amount of time you spend on the net affecting the cost, you're going to use the cost limit the amount of time you have. Sounds a lot like metering to me.

    "...As retail users move to DSL and cable connections, where each user pays for their dedicated connection, the pricing is invariably flat rate..." for now. It's a new technology. Examine the history of the catalytic meter in electrical service here. Once we have discovered the carrying capacity, you don't think this will change?

    Aside from the huge problems above, this guy fails to look at what drives economies: limited resources. The world has limited resources. I cannot convert the entire bulk of the Earth into fiber optics. Electricity costs to make. We simply cannot take the current backbone, give everyone an OC48, and have them load up as much as they like. We will run out of our finite resource, the backbone (which is more like a backweb, I guess, given the multiple spines). All of these things cost. Adding new capacity costs. Lines can be saturated. It's just like bread ... it costs to make, and only so many can use it before it is all gone. Money is an abstract method by which we allocate our finite physical resources. Just because we would like a free meal doesn't mean that the universe is obliged to give us one.

    I realize I should be addressing this Andrew Odlyzko, instead of the reviewer of the article, but, geez. I feel like a troll now.

  • by Xenu ( 21845 ) on Friday October 06, 2000 @06:26AM (#726419)
    For most communications systems, costs are determined largely by peak usage, not total usage. A telephone system is engineered to provide a certain quality-of-service during peak usage periods, often defined as the busy-hour. That drives the requirements for switch capacity and inter-office trunk lines. Similarly, a dialup ISP has to buy enough modems and phone lines to meet its quality-of-service standards during peak usage periods. One of the justifications for charging more for business subscriber lines is that the business subscribers are the main component of the system's peak usage. Residential users have a different usage pattern, using what would otherwise be idle capacity in the system.

    The tricky part is how do you charge for this? There seem to be two schools, the "cost plus markup" and the "value" school. The telephone companies like the "value" approach, as it generates larger profits. One possibility is to meter usage, but make the rates time dependent. Charge full-rate during peak usage periods and much cheaper rates during off-peak periods.

  • Recently, I have been considering getting a DSL connection from a non-telco provider. This article raises some issues for me. If I get a 1.5mb/sec DSL connection, I don't have any guarantee of getting 1.5mb/sec of useable bandwidth. Likewise, if I get a 512k DSL, will I even be guranteed that much?

    The same holds true if you get a T1. All ISPs oversubscribe their bandwidth. If everyone maxed out their T1 connection at the same time, the ISPs connection would be saturated and individual customers would get less then they are paying for.

    The ISPs can do this because most T1 users do not use their full bandwidth at the same time: Law of Large Numbers. The difference in quality between ISPs is the amount that they will oversubscribe the available bandwidth.

  • "Price discrimination..." way to coin a phrase that will automatically bias you against metering! Maybe he should have just used "Nazi Price Fixing" and been a little less subtle.

    That phrase certainly wasn't coined here. It's the standard term for charging people different prices for the same good. (It also wasn't quite as loaded when it was coined as it may be now.)

  • by Nicolas MONNET ( 4727 ) <nicoaltiva@@@gmail...com> on Friday October 06, 2000 @06:32AM (#726431) Journal
    I get ADSL in France, flat rate, no limitation. AOL here is pushing a flat rate phone subscription plan. That's where all the new offerings are heading.

    I see that in other countries, too.

    --

  • A fella by the name of Cannibal Harry got railed by Earthlink, his website had a short movie containing some highlights of a HALO get-together sponsored by bungie...and it got a LOT of downloads. So many in fact, Earthlink billed him for close to $30,000 (US). Check the story here:http://www.theregister.co.uk/c ont ent/1/13668.html [theregister.co.uk]
  • Did you ever look at CompuServe's prices back in the '80s? They were charging(IIRC, someone correct me) 6 bucks AN HOUR, and that's with 1200 baud access.

    C'mon we have it good!
  • by Mignon ( 34109 ) <satan@programmer.net> on Friday October 06, 2000 @06:42AM (#726442)
    "American consumers"

    That's redundant.

  • I'm surprised people aren't slinging ethernet out their windows and setting up Microwave links.

    Me too. Community networks seem like a really cool idea for a situation where lower bandwith links are expensive.
    Maybe it's just that there's not usually a 'critical mass' of users that have the time, expertise, and money to start a community net.
    I wonder if it will start becoming more popular to build small local nets now that RadioLAN cards are becoming cheaper and more available...

    --K
    Just my (unmetered) .02
    ---
  • And some people would pay less with a metered plan.

    Depending on the cost of the overheads involved with metering...
  • by devphil ( 51341 ) on Friday October 06, 2000 @06:49AM (#726452) Homepage
    Dr. Levine is also the moderator of the comp.compilers newsgroup, and the author of _Linkers and Loaders_, which is one of the few well-written books out there dealing with linkers and run-time loaders. (If you ever wanted to know all the fsck-ed up things with the Windows .EXE and .DLL format, read this book. :-)
  • by Junks Jerzey ( 54586 ) on Friday October 06, 2000 @06:57AM (#726457)
    Local phone companies don't charge metered rates for phone access, why should internet access companies? I'm a real light phone user, but I don't complain about paying $30/mo because someone else is on the phone 24/7 tying up more phone bandwidth.

    These schemes were cooked up based on an average call length which is no longer valid. Telephone exchanges were originally designed to handle a particular load, assuming relatively short average call times. That is, if you assume an average call length of three minutes, you can get by with a much smaller exchange than if you have to assume an average call length of two hours.
  • by alhaz ( 11039 ) on Friday October 06, 2000 @06:57AM (#726458) Homepage
    You are sorely mistaken with regards to the purpose and functionality of switched ethernet.

    Being "switched" does not guarantee you any ammount of bandwidth. Nobody ever even claimed it would, except maybe you.

    It's like this. A switch prevents traffic which does not need to be broadcasted from being broadcasted. By broadcasted i mean, on an unbridged, unswitched network, that is, an ethernet network with only repeaters, when machine E communicates with machine W, all machines from A to Z get a copy of what they said.

    A switch minimizes that so that only traffic which is of unknown destination or that is specifically broadcasted (ARP requests, etc) get repeated to every station.

    A switch is useful in only two situations. One, where you want to be reasonably assured that morons won't be able to sniff other peoples traffic, and Two, where you wish to minimize the ammount of broadcast radiation between segments of a network. But don't be suckered into believing that it is a panacea for either application.

    Furthermore, on homogenous switched networks, ANY one user can prevent ALL OTHER users from communicating with upstream parts of the network by flooding the uplink.

    Guaranteeing bandwidth on ethernet based networks is exceptionally difficult and involves exotic, expensive hardware.

    ATM PVC's used by DSL lines are an entirely different situation but I fear that i would be casting pearls before swine to attempt to explain it.

  • by edp ( 171151 ) on Friday October 06, 2000 @07:00AM (#726461) Homepage

    There are good ways to charge for service rendered, and we need them so long as there is network congestion. One proposal I saw years ago (sorry, too long, no pointer) is that each packet carry a bid indicating how much the sender will pay to have it sent. In each time slice, routers transmit the highest-bid packets and bill them all at the rate of the lowest bid transmitted. (Billing is accumulated and done in per-day chunks or something, not with additional packets.)

    A user would have some way of adjusting their bids, maybe telling email clients to bid nothing and telling their video streaming to bid 10 cents per megabyte. The email would go through eventually, which is fine, and the video streaming would work without annoying pauses -- or the user would choose to increase their bid to make it so, to suffer with the pauses, or to watch the video later, when network demand is off peak.

    There are other details -- packets coming back from servers might be billed to the requestor according to some token, or maybe they would be billed to the server, who would balance the charge by revenue in their own way -- ads, merchandise sold, charges to the web viewer, whatever.

    I liked the proposal when I saw it. I'm certainly happy paying a flat rate for unmetered service, and maybe I'd continuing bidding zero for my packets most of the time. But it would be nice to have the means to get some things faster when I wanted to, and it is entirely reasonable that people who want better service should pay for it. If you want to know what you're going to pay, you could set all your bids to zero, or software could help you estimate what to bid to match your budget -- and could adjust those bids as you accumulated charges to ensure that you stayed under budget.

    Note that when the network is not congested, packets are transmitted for free, even the highest-bid packets, because the router is able to transmit all requested packets in each time slice. So this system is really asking the people who want extra capacity the most to pay for it.

  • I use the 'net a lot and I don't want to have to count minutes (or megs) like I have to on my cellphone or long distance line.
    I don't want to pay my ISP for the latest Slackware ISO that I d/l'ed, nor do I want to pay for playing Q3 all night...


    Well, metered access wouldn't do you any favours. However, look at it from my point of view. I (actually a hypothetical me...) transfer a couple of kilobytes of plain ASCII email every day. I don't want to pay the same monthly fee to my ISP as you do. I don't want to pay over the odds for my tiny needs, just because the ISP is installing fatter pipes and faster switches for Q3 LPBs.

    Actually, the ISP service I'm (the real me this time) crying out for is this: a persistent unmetered low-bandwidth (14.4 is fine) connection so that a small news feed and email can get through all day long, which I would hope to be pretty cheap, with the option to manually switch to a metred high-bandwidth connection for gaming and streaming media.

    I don't think anyone (here in the UK) can provide me with that.
    --
  • From each according to his ability, to each according to his need.

    This is the way it works right now.

    Basically the same as local calls, unless you get one of those cheapo deals which limits your number of calls each month. I'd hate to think I'm siding with Marx, after all the good he did the world, but I benefit from it. Granted, if I want higher throughput I do have to pay more for a better line. If I don't use it much, guess who I subsidising? Uh, huh.


    --
    Chief Frog Inspector
  • That has to be one of the WORST ideas I have heard of. Putting monetary squabbles into web protocols? Come on. That sounds more like CompuServe's idea. You had to pay more to play the games, etc. Look where they are now.

    There are good ways to charge for service rendered, and we need them so long as there is network congestion. One proposal I saw years ago (sorry, too long, no pointer) is that each packet carry a bid indicating how much the sender will pay to have it sent. In each time slice, routers transmit the highest-bid packets and bill them all at the rate of the lowest bid transmitted. (Billing is accumulated and done in per-day chunks or something, not with additional packets.)
  • by Anonymous Coward
    I tried out the Altavista service for a few weeks on my Windows 2000 machine. The thing is, it wasn't just the annoying ad bar across the top that thay seemed to inist on running. A few weeks after I started running their client, I discovered strange log entries on one of my NetBSD machines (located on a 192.168.x.x subnet that the W2K machine is also connected to) that the Windows 2000 machine, with the IP address Altavista was assigning it, was sending some sort of packets to the NetBSD machine. They were probing out and around on other machines on my home network. I started getting a bit more paranoid and decided to set up a non-Administrator account on the W2K machine and only use that to connect to the Internet (I no longer make any connections to the net with Admin level accounts). The Altavista dialer wouldn't work. Apparently they require more access to the machine's resources. I quickly quit using the Altavista account.

    Just thought some of you might be interested. If you're curious and want to make waves against AltaVista, and you are a bit more technically advanced than I am, set up a 'Sacrificial Lamb' machine running NT or Windows 9x and sniff around. I think you'll find that the AltaVista client is poking around where it has no business. Could be a money-making opportunity for a young Linux-head willing to make some waves.
  • Instituting any metering system will raise the operating costs due to the trouble it takes to track usage.
    ... ..too open for abuse by unsavory providers.

    Since you didn't spell it out, once they are logging the use, they also can log what we do, where we link, etc. and sell it. Yeah, bug ol can of worms.


    --
    Chief Frog Inspector
  • by tzanger ( 1575 ) on Friday October 06, 2000 @07:15AM (#726476) Homepage

    It's like this. A switch prevents traffic which does not need to be broadcasted from being broadcasted. By broadcasted i mean, on an unbridged, unswitched network, that is, an ethernet network with only repeaters, when machine E communicates with machine W, all machines from A to Z get a copy of what they said.

    You are correct, but the net effect is that it can seem to bring more bandwidth to the individual users through reducing and/or eliminating collisions. If I have a 100Mbps n-way switch, users A and C can talk at 100Mbps while users B and D talk at 100Mbps. The net effect is that there is approximately 200Mbps worth of traffic flowing in that network. If both these same four users tried to do the same thing on a hub they wouldn't get anywhere near 200Mbps total throughput, as the collisions and resultant delays would kill the transfer speed of both "transactions" to well under 100Mbps.

    So yes, you are technically right, but the original poster also has a point, at least in n-way switched LANs.

  • markbark wrote
    Would you charger per bit.... per byte?
    Would you charge for useage or perhaps throttle back those who used too much bandwidth?

    Being in the ISP business [brokersys.com], I have a slightly different perspsective on the matter, although I intend to read the full paper, once I get a chance.

    The reason that we've never offered a metered service, even though a few people have asked for one in order to reduce their bills, is because we've never considered the work needed to keep track of users usage for billing purposes to be worth the effort.

    Two answer your question, there are two broad schemes used. The first is the peak bandwidth scheme (used by those who sell "burstable bandwidth") where you pay for the peak data rate you use usually with some averaging and time dependance. (In the most recent deal proposed to me it wasn't clear to me what the penalties were for exceeding the base rate.)

    The second is to simply charge by the bit, possibly with a certain amount provided at the base rate. For example, for 1.5 MB DSL service, you might be given, say, 50 gig per month (which corresponds to a utilization of about 10% of your line's capacity) at the base rate (maybe $10 per month for the bandwidth only.) plus, say, $1 per gig after that. I wouldn't meter outbound traffic at all. There's no point. I also wouldn't meter the traffic from your premise to my equipment, so you can check your mail as often as you'd like or load the Web page that shows your current month's usage without fear that that will put you over your quota.

    I'd suspect that even heavy-duty Web surfers and email addicts would have trouble getting anywhere near the base rate, and I'd offer fixed-rate service (maybe $20 per month) for the Napster users and guys who browse the binaries newsgroups.

    In my opinion, the key to customer acceptance of this mechanism is twofold. First, you need to offer a fixed rate for those people who want it. As the article points out, many people will pay substantially higher for a fixed-rate service than a variable-rate. Second, you have to make it easy for people to know what their usage rate is.

    One reason why people who have cell phones will pay extra for a large flat-rate plan instead of choosing a metered rate plan which might actually cost them less money is uncertainty in their usage. When starting out, most people don't have any idea how much they're going to use their phone. Once they now, then it isn't worth the bother to make the change. Take away that ignorance any fewer people will make that choice. Make it easier to switch and people will.

    I will tell you that although I worked out this scheme in some detail, it's not likely to be put in place. That's because the largest part of the cost of providing the service doesn't have anything to do with the upstream bandwidth, which is all this scheme meters.

  • The real danger here is when they charge for hours online, then the ISP has an incentive to provide crappy service - slower connections, slower servers, longer authentication protocols. They can even claim it's in the name of security, but the end result is, revenue goes up.
  • All dialup ISPs charge by connect time, not bandwidth. So what's the point in metering it? A comparison. I have a 56K modem, my neighbor ("Bob" for this comparison) has 1 56K. We both use an ISP that charges a flat rate, 20 hours/month for $10. Bob connects to check his email, read the news, and occasionally downloads some MP3s. My computer is connected 24x7, monitoring uptime by sending a ping packet to my 3 servers every 10 minutes. If a server isn't responding, it starts flashing lights and doing jumping jacks etc. Bob uses 18 hours per month, and is doing something all 18 hours. I use over 700 hours per month, and only use a small fraction of the bandwidth Bob uses. Assuming Bob is maxing out his modem, Bob is using 354 MB of bandwidth every month. I'm using under 500 K per month. My ISP charges $1 for every extra hour of connect time, so I get a bill every month for $750 while Bob pays $10, and he uses 700 times more bandwidth than I do.

    Metering would say that I should only be charged $1/month for my bandwidth, but my ISP says I'm connected 24x7 so I should be charged for every minute that I'm online. Until ISPs start charging people by bandwidth, metering simply won't work.

    "You'll die up there son, just like I did!" - Abe Simpson
  • by jafac ( 1449 ) on Friday October 06, 2000 @07:23AM (#726484) Homepage
    If only that kind of logic held true for Income Tax. . .
  • Having a flatrate account is a great thing from the billing side (I am an ISP) in that it makes things easy. However, we reserve the right to boink users who think $39 will get them a T1's worth of unique incoming bandwidth, meaning stuff I can't cache locally. Even with local caching the cost of the telco ATM connection becomes an issue if one user is hogging the resource. If all of the users are reasonable (we have a wide range for reasonable) then there is no problem. We have only boinked one user because he thought it was his constitutional right to consume $12oo of service while paying me $69. It is all about economics, some use more and some use less but the average works out where I get enough money to pay my employees and the house payment and that is good enough for me.
  • by slim ( 1652 ) <john@nOsPAm.hartnup.net> on Friday October 06, 2000 @07:24AM (#726486) Homepage
    Unless you're only transferring stuff to and from services at your ISP, all this is moot: it still comes down to the capacity on the ISP's pipes to their peers. These are the expensive links they have to keep upgrading every time RealAudio decide that streaming (insert high bandwidth streamable media) is a good idea... and that drives costs up for *every user*. Will the Quake players still be happy with unmetered access when they suddenly realise they're subsidising Video On Demand users?
    --
  • 5 gig/month? Wow. That's not very much at all. I've gone through 5 gigs in a single NIGHT before ;)

    -- Dr. Eldarion --
  • It is fairly well recognized that most people are seriously risk adverse. For example, given a choice between two bus schedules, one that makes you wait eight minutes every time, and the other that makes you wait five minutes three times and then fifteen minutes once, most people will choose the eight-minute schedule. Yes, they wait less time on average with the other schedule, but they are risk adverse and will "pay" a premium in order to avoid the 15-minute outcome.

    I myself am work adverse, and since there are four people on four computers behind the firewall server attached to the cable modem at my house, and one of the four is a teenaged boy whose downloads dwarf the rest of us, I am adverse to trying to define what each person's "fair" share of a metered limit would be, and even more adverse to having to implement it. I will pay more for the flat-rate plan just to avoid those hassles.

  • Maybe the solution isn't metering to prevent light users from subsidizing heavy users.

    maybe the solution is for the light users to become heavy users, so we're all getting the same for our $!.

    Duh!

    Tell gramma to log into /. and start a-trollin'!
  • by mattdm ( 1931 )
    And you can't get a T-1 for the same price as a 28.8 dialup.

    --

  • by Palin Majere ( 4000 ) on Friday October 06, 2000 @07:39AM (#726500)
    Disclaimer: I work for an ISP.

    "Users love low flat rates". Gee, what a shock. People like free almost anything but herpes. Of course they want it for free. I'd like my car to cost $50, too. So what?

    Um, where exactly did the word 'free' come into play here? He never mentions how much the flat rate should be. Pricing specifics don't enter into the picture here. You're using the exact same tactics you accuse him of using (see below).

    "...nearly all users pay flat rates regardless of their usage..." Not exactly. Dialup has an absolute bandwidth limit, there is only so much I can download over a 56k per month. ISDN has a higher limit, cable higher still, DSL, T1, T3, and up to OC48 (I suppose something exists beyond that). The rate I pay per month determines a ceiling on my usage.

    Thank you for having missed the boat completely. The point here is to let the _technology_ determine you bandwidth technology, and to charge equally across the board for it. Thus, for (pulling a number out of a hat) 29.95 a month, you get all the bandwidth your DSL line can handle. Just like a phone line and local calls. The whole point is to argue for the removal of arbitrarily-induced bandwidth limits.

    "...metering would fly in the face of hundreds of years of history..." like metered mail (or stamps), pay by minute for long-distance telephone calls, and that is in the communications arena alone. We still have metered gas, electricity, and so on. Sounds like history is on the metering.

    No. You've again demonstrated that you've missed the point. There are things that *have* to be metered. Electricity and gas are one of them, because the costs associated with allowing a flat-rate fee for these services is astronomical. This is not true with bandwidth.

    "Price discrimination..." way to coin a phrase that will automatically bias you against metering! Maybe he should have just used "Nazi Price Fixing" and been a little less subtle.

    You've just used the same tactics by pointing out the "Nazi Price Fixing" comment. Also see above, where you begin dragging the concept of "free" bandwidth into a discussion that had nothing to do with things being "free".

    "...residential telephone users can get flat rate plans with free local calls..." Said flat rate varies wildly. How much you want to bet that if everyone got on the phone and began babbling 24/7, our "flat rates" would suddenly undergo an upwards shift?

    And how exactly were you expecting "flat rates" to be determined? This is how "flat rates" are currently determined in the world at large, and it's the same "flat rate" that is being discussed in the article. Were you under some mistaken assumption that a "flat rate" is a price that never changes, even if associated costs rise?

    "...one can add extra fiber capacity without limit..." conveniently ignoring the cost of the fiber, installation, repeaters, etc. That money has to come from somewhere. Until Slashdot posts a nice biotech story on trees engineered to grow fiberop, I won't be holding my breath on adding fiber for free.

    Um, yes, have you been paying attention? The money comes from the flat rate fees that this paper is all about. If you set your fees properly, the number of users it takes to saturate a unit of bandwidth (like a T-3 for example) should pay for the bandwidth itself. If you have priced your flat-rate fees so that they do not pay for the resources they consume, you have priced yourself at a loss, and it's your own fault when your network can't survive an increase in load.

    "...When necessary, ISPs can discourage camping via monthly caps, limits on session length, or limits on peak time usage..." Oh, I see. So, instead of having the amount of time you spend on the net affecting the cost, you're going to use the cost limit the amount of time you have. Sounds a lot like metering to me.

    No, it's nothing like metering. There is no distinction between service levels. All users are affected by these caps. They don't pay a different price to be able to ignore them, or to be less affected by them. It's a hard limit, whereas metering represents a "soft" limit.

    We simply cannot take the current backbone, give everyone an OC48, and have them load up as much as they like. We will run out of our finite resource, the backbone (which is more like a backweb, I guess, given the multiple spines). All of these things cost. Adding new capacity costs. Lines can be saturated. It's just like bread ... it costs to make, and only so many can use it before it is all gone.

    And who the heck said anything about giving people OC48s?? The point is to charge people a flat rate fee. Nowhere either the article by John Levine or the associated research papers by Andrew Odlyzko. If we charge a flat-rate fee for those OC48s that covers their costs to produce, there's no reason at all we can't give everyone one of them. As long as they pay for themselves, there's not an issue. The backbone is perfectly capable of growing as demand requires it, as it continues to do on a practically daily basis.

    Just because we would like a free meal doesn't mean that the universe is obliged to give us one.

    Perhaps you should start the "free bandwidth fund". Nobody's mentioned free meals here but you.
  • Americans are more than able and willing to understand metered service, we have it for everything from electricity to water to cell phones. In fact there are lots of ISPs that offer a variety of plans based on peak time usage (which affects the cost of a modem pool) which consumers can use to reduce the cost of having an internet connection. Finally, by saying the usage is "unlimited" this really twists the sense of the word. I do not have "unlimited" bandwidth if I'm connecting 24-7 through a 56k. I have 24*7*56k total available to me in any week (the formula is off, but you get the idea). It is up to me as a consumer to maximize my bandwidth usage so that I take advantage of that (unlikely that I'm going to saturate my modem line like that, no matter how hard I try). If I want more connectivity than that (per month total) or want to achieve higher transfer rates on a more discrete time basis I have to pay more for something like cable, DSL, T1, or some other better service. So really, usage is already metered. I'd say the biggest reason not to try to whittle down the $20/mth for the average 56k dialup is that I'd have to start religiously avoiding web pages with a lot of graphics, and things like that in order to end up going over my total monthly bandwidth allowance... and frankly, it's worth $20 a month to me to not have to do that. And if I had an even faster connection, I'd have to be even more careful not to run up a bill since I'd be able to download larger files much faster-- I'd rather pay the $40-$70/month for a cable line or DSL on the basic assumption that I'm going to let most of my available bandwidth go to waste-- the same assumption I make when I buy flat rate "unlimited" local service for my home phone (even though there is metered phone service available, which is much cheaper).
  • by walnut ( 78312 ) on Friday October 06, 2000 @07:46AM (#726505)
    Lets discuss free services shal we?

    I currently pay a phone bill, an electrical bill, a wireless bill, cable, rent, my car, buy groceries, and put fuel in my car. I choose not to pay for internet access (lunchtime/morning workbreak instead). I also do not pay for water or heating - two common bills which are covered by my landlord.

    Personally, it would be ideal if I did not have to pay for any of this, but that is equivalent to wishing money grew on trees.

    I classify bills into two types: essential and non-essential. Essential bills cover any survival based service: Water, Electricity, heating, grocery, and housing (rent). Non-essential bills include Phone, Wireless, Cable, a car, gasoline, and ISP access.

    The government subsidises most essential costs for families who are low-income. They do not pay it outright, they do however cheapen or give tax credits for these costs.

    It *could* be argued that all of these bills are non-essential, as there are people who chop their own wood for heating, do not use electricity and grow and hunt for their food. Quite literally I spent the weekend with friends who do this. They have a phone (for business actually), and gas power. If they need electricity *for his laptop* they use car batteries. Soon they will be adding solar to their cabin and actually charge batteries that way. They have gas lights, gas stove and a gas refridgerator. Their house is amazingly warm from the woodstove (though I hear it gets a little nipply during a cold snowstorm if the fire goes out.) Quite honeslty they are making little impact on the environment (they would be getting Nuclear Power - which they are against, and the addition of the solar/wind powers will increase their self-sufficency). Lastly their water is gravity fed not pumped - what exactly that means I am unsure.

    While I grew up in rural Maine, I now live in Boston and I am afforded an amazing amount of conveniences. I however, envy every aspect of that house - it is an engineering dream. They built a nearly autonomous home and are expanding its autonomy from overpriced utilities further.

    But I digress....

    Internet access is so survivally trivial that to even consider that it, of ALL bills, should be free is ludicrous(spelling?). You have no RIGHT to be online. You have no RIGHT to own a computer. You made the decision to purchase a computer, you made the decision to purchase an online service. There was never a question of your survival if you did not.

    I will consider my friend an exception to the system and maintain the "essentiality" of the services I qualified as essential before. Proposal of free online service is silly - as there are many services necessary to survival in modern society which should be free long before ISPs are.

    An ISP is a "PROFFIT" based company. They have every right to charge whatever the hell they feel like (within reason).

    I work for a research engineering firm and to even consider charging half of what we do (let alone offer it for free) is completely ludicrous.

    ---
  • Whether or not people realize it, metering already exists in the sense that if you need a certain level of access you have to pay for a bigger pipe. The home user who is occasionally picking up email and doing a little shopping doesn't need DSL or a Cable Modem. The heavy gamer or downloader will pay for the higher throughput. Those with business level demands pay for the T-1 or OC-3.
  • by Tony Shepps ( 333 ) on Friday October 06, 2000 @07:48AM (#726509) Homepage
    I can't decide which irony-n-sarcasm-filled reply to use here, so you decide:

    • Luckily, since Babbage's day, we have made some progress in the amount of time needed to calculate things.
    - or -
    • If only Babbage had made such a statement after developing his engine.
    - or -
    • What a wonderful idea: let's model the Internet after the Post Office.

    --
  • Except that, in the (U.S.) government's infinite wisdom, they have transferred 99% of the cost of calculation to the taxpayers themselves. The cost of calculating your tax is not widely considered a part of your tax, but surely it is.
    --
  • Your post makes perfect sense. But have you noticed that the market doesn't work that way?

    If your area is like my area, there aren't many buffet restaurants around. And the ones that are around serve cruddy food.

    And so, for some reason, the market has demanded and gotten buffet service, and the "food" is correspondingly cruddy. Lower bandwidth than expected, 3-4 month install times for DSL, incompetent service, etc.

    We should be demanding restaurant service, so that we could get better food.
    --

  • Well then in that case...

    Politicians should pay a $1 liars fee to each and every single person their lies affect. This way people lied to by a politician know that at least it cost THEM for a change. Then we can start metering verbal speech, by the word of course for those whom don't speak much...
  • I don't understand the point this article is trying to make. Internet usage IS metered, right now. If you buy an OC-48 connection, you will almost certainly be charged based on what percentage of it you use.

    It is true that home lines -- modems, DSL, and the like -- are generally not charged on a per-usage basis. The amount of bandwidth consumed by the average home line is too small to make it worth the expense of metering.

    - Damien
  • The real problem I see with that type of billing is that you're paying to receive instead of to send. That means you pay for spam or unsolicited packets. What if some asshole sends you 20 Gig of ping packets overnight? Ugh.

    If metered billing is done, costs need to be payed by sender. Alas, that means that servers will have to bill users to cover bandwidth costs. Still, it's the only way that's fair.


    ---
  • by Animats ( 122034 ) on Friday October 06, 2000 @08:29AM (#726524) Homepage
    From an ISP perspective, the charges for the big pipe on the back side are a small part of the costs of running the business. Marketing and tech support are the big items, followed by billing and local telco line costs. Bulk bandwidth is so cheap it just isn't a problem past the local loop.

    Actually, metering tech support would make more sense. But 900 numbers have such a bad reputation (and the telco takes such a big cut) that that doesn't work.

    Metering connect time has been tried; remember AOL. That's history.

    The only way metering is going to happen is if somebody gets a monopoly. Otherwise, unmetered services will wipe out metered ones.

  • Technically, capitalism should, in the long run, drive the cost down to roughly the cost of "that something." Only when you have a monopoly situaiton, like rights to a recording artist's work, do we generally see prices much above the cost of production. What most people fail to realize is that the cost of production for "something" ISN'T just the worth of the materials used and the machine and people that put them together. It now also involves cost of advertising, marketing, research to design new iterations of the product, etc. All these things cost money and manpower to, and drive up the "real" cost of "something."
  • No one is limiting your use. They're simply asking that you pay for it. The whole problem with a flat rate is that it ends up being calculated by the average amount of bandwidth use. And as you must understand- supplying bandwidth costs money. But therefore, people who use that bandwidth only minimally are essentialy subsidizing users who use lots more bandwidth- it isn't an issue of hoarding, but rather one of different people needing different things. If I only want to use a tiny amount of bandwidth to check my email twice everyday, I should be able to pay a much smaller price than someone who wants to leave napster on 24/7. And this is a good thing! Because it means that people with very little money will still be able to afford SOME access, rather than a monthly bill to high for them to pay. Plus, it means that high load users can, if they want, buy more. What shouldn't be charged for on the net is distance. That concept is obsolete even for the phone companies (it's just that they are required by law (and telecom law is the most byzantine and insane of all industry regulations) to charge you for distance, even if you travel entirely in, say BEll Atlantic's network). One thing that COULD happen, however, is metered charges depending on volume of traffic over a certain line. So looking at a site in Japan might cost more not because it's far away (meaningless) but because at the hour you used it, tons of other people were jockying for that same amount of bandwidth to Japan. The REAL importance of market metering, however, is that it allocates resources properly. Instead of everyone trying to slashdot a site all at once, and no one getting anything worthwhile, when the bandwidth to that site is metered, people as a group will spread out their use to avoid extra charges for trying to access already crowded pipes. This efficiency not only helps allocate resources better, but is better overall for the net, bringing down the aboslute cost of bandwidth as well.
  • by re-geeked ( 113937 ) on Friday October 06, 2000 @08:52AM (#726531)
    Imagine if residential electrical usage were paid flat rate instead of metering. It seems to be much the same model as Internet access: everyone needs a certain amount of infrastructure to handle their needs, even though they don't often use it fully.

    The main objection would be that the cost of producing electricity is not marginal when compared to the cost of building infrastructure, EXCEPT for nuclear and renewables, where the cost of maintaining infrastructure is almost all of the production cost. So flat rate would actually encourage utilities to invest in renewables and nuclear, and discourage use of fossil fuels.

    Residential usage can benefit from conservation practices under metering, but only so much. Today, we subsidize electric utilities' conservation and education efforts. If flat-rate were the model, the advantages of such efforts would be evident to the utilities, and the efforts would increase: utilities would likely pay appliance manufacturers and home-builders to build in efficiency, rather than conservation-minded consumers having to pay a premium and hunt for such products.

    Electric use wouldn't suffer the same level of "abuse" as bandwidth -- after a certain point, you don't need any more wattage in your light bulbs. If bandwith flat-rates can survive with "campers", electric flat rates could survive with people running businesses on their residential feeds.

    Finally, we are facing an electric capacity shortage in the US today, and the article's point that metered service increases peak use is important here.

    Has anyone heard proposals along these lines?

    What would it do to the home-generation and co-generation efforts that benefit from reducing their metered usage? Could these producers simply not pay the flat rate and provide the power themselves?

  • Your friends have to understand their choice of living arrangements may suit them, but they are being very hard on the environment with some of their choices.

    As an example, heating with wood causes far more pollution than using gas or electricity for heat (especially if the electricity comes from a hydroelectric, solar, wind, or nuclear sources). Unfortunately, I don't have the data to compare heating with electicity generated from a coal- or oil-fired plant vs heating with wood.

    On solar power: Unfortunately, solar power costs far too much to generate electricity practically. The only time it is worthwhile to generate electricity from solar power is when the location is too remote to run power lines to from a more conventional source. Unless your friends live in an area unserviced by power lines, their choice of solar power will be a costly one. However, it is their choice, and I am glad they live where they have the freedom to make that choice!
  • The telephone studies describing consumer preferences for flat-rate over usage-blled have been out for some time and are also cited in discussions of behavioral finance. I've long thought this would be relevant to micropayment systems, as a similar economic decision exists.

    The assumption is that micropayments are so small that no one will care. But this isn't true. There is still the floating anxiety and bother of "mentally counting" each minute (pun intended) purchase. Also related, if what you are purchasing with micropayments has clearly perceiveable "high value", such a system will likely be trivially accepted by users. If your prospective users do not clearly perceive value (whatever that means to them, not to you as a marketer), either due to the type of product offered or the way you've "positioned" your product, micropayment economics will fail.

    I suspect that micropayments haven't really taken off in part because this fundamental piece of psychology was never integrated into either the protocols or the business plans of those creating micropayment systems.

  • by sulli ( 195030 ) on Friday October 06, 2000 @08:57AM (#726536) Journal
    Instituting any metering system will raise the operating costs due to the trouble it takes to track usage.

    I work for a major national ISP, and this is absolutely true. Metering usage requires large amounts of engineering, significant new equipment, support systems, etc. - and leads to vast amounts of customer support calls for a few bucks in service charges. Just not worth it. Even in dial-up service, you only meter usage if you have to - e.g. 800 dial-up, where costs are fairly high - not in basic service.

    Also, it's a competitive market, and customers want flat rate, so that's what we give them.

    It's interesting: every couple of months, some fancy-pants vendor sends me a package in the mail promising "You can charge for usage! Make money on QoS! Decommoditize Internet access with VPNs, traffic shaping, etc.!" I don't have a single customer willing to pay for such a thing, so into the can they go. So the vendor names keep changing, and not because they sell out to Cisco.

    The old KISS rule makes the most sense in the ISP biz. Avoid confusing your customers and they'll be more likely to buy and upgrade.

  • Quelle horreur! This is precisely what ISPs want to avoid. The support calls that counter-logs, faked router reports, real router reports, cell loss on regional DSL/ATM networks not connected to the backbone, noise on the cable line, mice eating inside wire, the Napster user next door consuming all bandwidth, etc., etc. would cause are a huge disincentive to metered rate service.

    Remember when Sprint announced ION for home users, [sprint.com] with metered bandwidth? It went over like a lead balloon.

  • Isn't the CRTC trying to promote competition in DSL? Aren't there other ISPs that can connect to DSL networks, or is Canada all tied up by the local monopolies?

    Yucko.

  • well, the huge difference is that if you're a lazy ass and watch TV all day, there's no way it could have any impact on your neighbors. If your isp oversold in your area and you're pegged at full utilization 24/7, that's less bandwidth for everybody else. Broadcast services don't really compare well with stuff like internet, gas, electric, water, etc.
  • New Brunswick sucks when it comes to the net which is another reason I'm moving to Montreal.

    In NB now, we can get DSL in 3 (maybe 4 now) cities. And only in certain parts of those cities.

    Cable service is a joke. Last I checked, you needed a modem and had to use your phone line for the upstream. So, really, the only choice for broadband is the DSL I explained earlier, and it's only available through one provider, who also happens to be our ever-growing telco.

    Unless you're rich. Then you can get a T1 or ISDN or whatever for outlandish prices.

    So, as I said, I'm moving to Montreal, where at least there are more options.. but I've heard that Bell Canada likes to.. uh.. flex their power up there.
  • Good point. I can often pull down 1/4 meg/sec from menace.csd.unb.ca (linux site 150km away (in F'ton), which I'm sure you're aware of). And I don't think I've ever been charges extra usage for DSL, but my point was that they ARE monitoring our usage.

    And I've never had DSL in those other provinces, but is it normal that service just dies for 1/2 hour at a time once a week or so?
  • in germany, all providers offer time metered access, while a couple also offer flat rate schemes. This way, people can decide on their online behaviour (low/free monthly charge, higher minute charge -> light users higher monthly charge, low/free minute charge -> power use) i don't see what is bad about more consumer choice. anyway, before telco liberalization we only had metered local calls. i wonder what the prices for umts service are gonna be like
  • by cr0sh ( 43134 ) on Friday October 06, 2000 @10:03AM (#726559) Homepage
    ...for broadband connections.

    Why? I currently have @Home service (yeah, I know it sucks, but it is all I can get right now), but in order to stay legit, I am not allowed to run servers. I am also capped on my upload bandwidth (and probably capped on the download, but at several times what the upload cap is).

    Before I signed up for the service, I repeatedly tried to get them to offer me more bandwidth and the ability to run a server (hey, I am not wanting to so I can run an MP3 or p0rn server - I just would like to host my site at home, instead of through HE), even offering to pay more for any extra bandwidth I use, etc. They suggested I look into @Work - but since this is a hobbiest site with low hit counts, I can't afford that kind of access.

    I was even willing to keep the cap, and just allow me to run a server, but they wouldn't do it (they wouldn't even let me negotiate the contract)...

    Bleh...

    Anyhow, if we could get metered service for those who want it, and allow us to run servers and pay for what is used, then maybe we can get out of these stuffy contracts that disallow you from reselling the service or using it to run a server or whatnot, and get back to just providing a pipe to use.

    I support the EFF [eff.org] - do you?
  • Around these parts (Calgary, Canada) there have (over year ago last I looked) been the CHOICE of flat rate at $20/month or Small cap (5mb) for $10/month and some $/meg after the fact for phone connections.

    Same should be available for high speed, but it isn't ('cept for a cap for web hogs) because most people prefer higher but steady monthly charges. So we get $40/month cable or DSL and that's it for your 'options'.

    The water utility offers flat rate and metered, yet most people keep flat even though (they say) that most people would pay less on metered.

    Quite simply people will pay more for financial stability and simplicity of billing. BUT I wish there would be more choices for those of us who have enough of a clue factor to know their usage patterns.

    I went with a total pay-by-the-minute cel phone this year because I KNOW that my usage is low. I would never have gotten a phone at the $20/month rate for time I'd never use up.

    I can't do this for web access; Thus I stick with a cheap 56K phone rather that pay the same for a limited (but fast) high speed connection.

    Is it worth it for administration and # of customers for this option to be offered. Dunno.

  • by BeBoxer ( 14448 ) on Friday October 06, 2000 @10:15AM (#726562)
    One of the biggest problems with metered billing is what do you do when someone decides to rack up your bill? Let's say I'm some script kiddie whose on an unmetered line (say at college.) Let's say I do a ping with 10K packet size to your home DSL address at the default frequency of once a second for a month. By my math, that adds up to almost 25GB of traffic. One ping a second won't even get noticed by 99% of DSL users, until they get that $200 dollar ISP bill.

    That's one of the big problems with metered billing. It's one thing when a script kiddie gets upset at you and floods you with traffic for a few hours. It's a whole different story if you get a huge bill from your ISP because of it.

    If everyone goes to metered billing you will see all sorts of abuses as crackers try to set up servers on other peoples machines to avoid paying the bills for their traffic. Add that up to the aforementioned harrasment traffic jacking up peoples bills. Plus the dishonest users who blame their traffic spikes on "hackers".

    I just don't see it being worth the headache for an ISP to charge by the byte. You can bet that any user that is hit by the above problems is going to run screaming to the nearest flat rate ISP. Besides, the rates are metered to a certain extent. Dialup access is not the same cost as OC-3 by a long shot. So all the dialup users are in the same cost pool. So what? They are in a different cost pool from the DSL users, who are in a different pool from the T3 users, etc.
  • Europe and Japan already have metering ... it's by the local phone company who charge for local phone calls by the minute. I've lived there, and it s#x. IMHO, it has caused slower I'net adoption and reduced usage.


  • Unfortunately most of us live in capitalist societies where the price of something is based on the market demand for that something and has very little to do with the actual cost of that something.


    Well, once the widget has been made this is true. This is why lots of analysis is done to figure out what people might pay. If those numbers are too low, then the comodity won't be produced. Likewise, when you have an excess, and the market sale price is too low, you may opt to do something other than sell it.. For example, if I have a car, and the resale value is too low, I might strip it down and sell the pieces.

    You say unfortunately, but this is a very efficient model. In the case of essential goods, the government can step in an regulate (such as the power industry, telephone, welfare, etc). In a non-market-based society, it's like having every resource regulated, which makes most services sold at inefficient levels. Often, there are pricing departments that supposedly try and find the "right" levels, but the market is too dynmic. This year, more people will want to buy the PT cursuer than next. How can you best determine who gets what? Is it first come first serve? Or should the market price adapt based on Supply and Demand, and the very first are just lucky, while towards the end, only those that really want it (or happen to be rich) get it. The difference is that it's more difficult to determine who really deserves to get the widget a-priori. Much like it's more difficult to maintain accounting on IP or CPU traffic for the entire net.

    -Michael

  • What most people fail to realize is that the cost of production for "something" ISN'T just the worth of the materials used and the machine and people that put them together. It now also involves cost of advertising, marketing, research to design new iterations of the product, etc. All these things cost money and manpower to, and drive up the "real" cost of "something."

    You can think of it like a B-tree. The leaf nodes are the resources. But that's not the total number of nodes in the system. You have all the connecting nodes all the way up the tree. The next to bottom level would be the workers that work the materials, then the supervisors, then the planners (who direct the supervisors to direct the workers). You break off the planners into R&D. At the very top is the executive board and finally the CEO. Every one of these guys has a cost.

    BUT, none of this has anything to do with the price. The marginal cost (which includes interest on any borrowed resources required to produce the factories) is factored into the initial price. But once it gets going and the factories are set to produce x-widgets / cycle, then the supply is set, and prices is totally based on that fixed supply and the varying demand (which is affected by competition).

    Cost only influences prices in the long run (in terms of entry or exiting a market, or in adjusting the number of manufactured widgets).

    Telephone / cable company already has your wires layed, their cost is really that of the BW on the major trunks, and the power lines. They also try to factor in the depretiation cost of the hardware, but that's only taken into consideration at initial cost time. Your rates only really change seasonally when any major changes take place (which typically affects volume or quality of service)

  • A wire can only carry so much data.

    When it's full, everyone else has to suffer.


    Not necessarily true. You offer Quality of Service to your high-paying customers. Filter out a percentage of packets from your variable rate customers. POTS Telephone lines (like modem connections) have a fixed channel rate, and could seriously disrupt things if sample-packets are periodically dropped. ISDN, DSL and T1's however are all digital, and entire frames are droppable since the end points can recover.

    The carrier marks your Point-to-Point interface with a QOS which ultimately determines the drop-rate. The average user would be tied down during peek-hours. They'd have to spend more for peek-hour use just like current long-distance services.
    Long distance carriers can afford to do 24/7 same-pricing only because they're gambling that people make mainly regional calls. With the internet, that's not the case. We're all over the world and back several times in an evening.

    Monitoring that BW at every point and probagating trunk charges would be insane. Major trunks or backbones couldn't keep up with the volume of charging data (especially in light of their having a fixed cost no matter who sends to whom). It's only the ISPs with hundreds of home-connections and one or more major trunk connections that would have any incentive for this. And that's what we see today. For anything higher than a fixed cost modem-line, you pay proportional to the BW.
  • The /. story points you to an article by John Levine, but this is really just an analysis of Andrew Odlyzko's paper on the subject.

    You can view Andrew's paper on his website at www.research.att.com/~amo/doc/ net works.html [att.com], where you can find several other interesting papers too.

    Direct links the the Content is not king paper are: [Abstract] [slashdot.org] [PostScript] [slashdot.org] [PDF] [slashdot.org] [LaTeX] [slashdot.org]

    One interesting quote in the paper was:

    Just the spending on phone services is higher than all advertising outlays. So say good-bye to all those plans for financing the Internet through advertising! Yes, advertising can help fund some services, but it will not provide the generous revenue streams that are needed to support a communications infrastructure as large as the phone system.

  • If you access certain "more expensive" sites, will you be charged more.

    This would make for an interesting stratification of the web. Only the rich can afford streaming video and audio.

  • I agree with your estimation that things like heating, food, and lodging are essential while phone and internet access are not. There are however, many fallacies in your little post.

    Heating with wood is far more detrimental to the environment than most of the other methods. Including nuclear power. As someone who worked in the nuclear industry for 10 years, you're just going to have to take my word on that. (Yes, there are some dirty reactors still in operation but we actually know how to build them right these days. The fact that no one is doing so is unfortunate. Coal fired power plants are even worse on the environment. Ever visit a strip mine?)

    Your friends have a lot of money. Adding solar power to a house is expensive and probably not worth the money in most states in the US. The southwest, Texas, Florida perhaps. Not many other places. Gas stove? Gas costs money. They hunt for their food? On their own land? What would happen if all 300 million of us had to hunt for our food. Your friends' lifestyle is only sustainable because the rest of us live differently.

    The fact that you can survive without phone or internet access doesn't say anything about your quality of life.

    First let's look at lifestyle. If you're the loner type, then moving to a house in the woods might be the thing for you. Man (and woman) is a social animal. Most (>70% I believe) of the US lives in an urban area. We want to be around other people. We want to communicate. Picking up the phone and calling any one of my friends at any time is a convenience and definitely improves the quality of my life.

    Secondly, let's look at money. If you're not rich, how do you achieve a lifestyle of no phone/net access. How many professions (or ways of making money) are left without using the phone or harming the environment. Damn few. You can live in your shack in the woods and proclaim you're not harming the environment, but what do you do for a living?

    And lastly, I believe you're incredibly shortsighted. Right now it's not necessary to have net access. I'm not sure that's going to be true in 50 years. You'll likely get everything but the essentials via the net. Music, books, entertainment, interactive games, etc. You'll be able to get by without it, just like you can get by without a phone today. The Amish do so. Doesn't mean the rest of us want to live that way.

    Perhaps in this day and age online access shouldn't be subsidized, but I see a point in the not too distant future when it becomes necessary. I know that phones are still subsidized for low-income families. I believe that will happen for 'net access also.

    You can proclaim your friends as having less kharmic debt to nature than most of us but the only thing that allows them to do so is the rest of us living differently. 100 million people hunting and searching for fire wood for their families would shortly deplete our forests and game.

    Your friends are not living an ideal life in any absolute sense. Just in your estimation.
    --
    Looking for a job [hotjobs.com]
  • by Sloppy ( 14984 ) on Friday October 06, 2000 @12:06PM (#726577) Homepage Journal

    What a horrible idea. I don't want my electric bill to go up, just because all my neighbors prefer refrigerated air over evaporative cooling, incandescent over flourescent, etc. Flat rates take away peoples' incentive to be efficient.

    The reason you can't compare bandwidth to electric is that when electricity is flowing a resource is really being used up. It's not just infrastructure, it's consumed energy too. With bandwidth, there isn't the consumption aspect of it.


    ---
  • As anyone who's been to Comdex knows, the buffets at all the casinos suck big time. They're designed for low, low cost per attendee, and they make their money (or break even: remember that cheap buffets bring in the gamblers) by making college dorm-quality grub in huge volume. Not so great for the gourmet.

    But ISP service is fundamentally different. Buffets offer a wide variety of food, and can charge a flat rate (and offer very skimpy table service) because they can average it all over a large number of fairly predictable users. ISPs, on the other hand, offer one thing: internet access. It's more like a cafe where you get free refills, and they know that most users don't get the refill; they can afford to accommodate the few all-day coffee drinkers, who also buy more donuts (think email accounts, listservs, that sort of thing). It all works out.

  • This allows politicians' rich crony friends to use obscure taxcode loopholes. The gub'mint doesn't want a simple algorithm because people might actually understand it.


  • What shouldn't be charged for on the net is distance. That concept is obsolete even for the phone companies (it's just that they are required by law (and telecom law is the most byzantine and insane of all industry regulations) to charge you for distance, even if you travel entirely in, say BEll Atlantic's network).

    What makes you think a "long distance" packet doesn't really cost more money to send then a "short distance" one? If you send a packet up your ADSL line to someone down the block (who is signe up with the ISP) the packet will go up your ADSL line, maybe across a DSLAM, into some manner of router, maybe to another router in the same hub across a relitavly cheap gigabit ethernet (or maybe just 100Mbit).

    If you send the same packet from VA to NJ you also involve one or more long haul links which have a large monthly cost. Sure you use a tiny bit of it, but if you packet it part of the peak demand, then it is part of what causes the next round of expansion (if it is off peak then it is essensally free).

    If you send the packet from VA to Europe there are even more expensave links involved. (very very costly undersea links...expensave links in countries where the PTT has a monopoly, or effectave monopoly on data lines...)

    If you cross from one ISP to another you have the cost of the links, and you have the cost of whatever polotics needed to be run through to get peering, or dollars to be a "wholesale reseller", and monthly rent on more space in the middle of some telco facility, and...

    I don't think it is a good idea to charge for long-distance Internet traffic, but the idea that distance is free is just wrong. I think the cost of even finding the cost for IP packets would excede the cost of the packet, let alone the cost of recording it! Even if it didn't nobody would want to pay.

  • You have a point - but as an operator of the server, it would be my responsibility to limit the number of users/bandwidth to something reasonable, so that it wouldn't be hogged. In addition, @Home should provide sufficient bandwidth at those local nodes so that such flooding is less of a problem for others, as well as providing tools to see how much bandwidth you are using out of the "pool", so that you can throttle back as needed.

    I have thought about running on high ports, but that isn't quite the same as how I have my site right now, where anyone who clicks the link above can see it, and search engines can see it easily as well. IOW, I would rather run on standard ports for http.

    Now, high non-standard ports would be OK for me to do some other work I have thought about (setting up a personal, my use only, FTP server - to xfer files between my work and home - etc), but I still would rather be able to do this legally, than skirting the edges and getting my contract canceled because I ran a telnet daemon on my box that I used occasionally...

    I support the EFF [eff.org] - do you?
  • Robert Metcalfe founded 3Com Corporation and designed the Ethernet protocol for computer networks. Metcalfe's Law states that the usefulness, or utility, of a network equals the square of the number of users. I believe that this is true of internet traffic. If we had metered bandwidth, less people would post on slashdot, less people would share their napster files, there would be fewer downloads of linux, fewer patches posted for linux, a dramatically, exponentially smaller free software movement. The internet would suck.
  • What makes you think a "long distance" packet doesn't really cost more money to send then a "short distance" one? If you send a packet up your ADSL line to someone down the block (who is signe up with the ISP) the packet will go up your ADSL line, maybe across a DSLAM, into some manner of router, maybe to another router in the same hub across a relitavly cheap gigabit ethernet (or maybe just 100Mbit).

    Have some fun with traceroute. I have sent packets to a location only a few miles away that got routed (in several hops) across several states and then back down (through different states) only to arrive a short distance away. If it really cost much more to do that, I'm certain that the various providers would have made sure that such routes didn't happen.

    The real costs are based on peak usage. The equipment needed to maintain 10Gb is much more expensive than that needed to maintain 28Kb. The long route I saw will be eliminated when enough packets take that route to require equipment upgrades. At that point, the cost of adding a peer route locally (possably as cheap as 20 feet of Cat-5, possably as expensive as laying several miles of new fiber and 2 new switches + rack space) will be compared to the cost of upgrading the existing route.

    In the cost equasion, there is never any benefit to carrying less than peak traffic (though in reality, that happens all the time). So, someone sucking up an extra Mb at peak time on a network running at capacity costs real money. The same person doing the same thing at 3:00 A.M. with a network at 10% capacity costs nothing.

    Costs also involve a lot of other factors such as the difference between simply charging everyone in the user database the same thing and not worrying about invoices vs. actually measuring the average peak used for each user, producing an invoice (electronic or paper), charging the various amounts, and fielding questions from customers who don't understand why they got a high bill this month, or who feel that they were over charged. Include in the latter category those who feel certain enough (right or wrong) to actually refuse to pay.

    To top it all off, there's the guy down the street who's just getting started and charges a flat rate to entice your customers away.

  • My point was that all these guys DO factor into the price of creating a product, and they usually aren't paid attention to. That "fixed supply" can vaary wildly depending on the costs of marketing, further research to keep the industry alive (one reason pills cost so much- because the reasearch to develop them was so costly, and the research to keep developing them is also costly.)
  • You are right, so am i, and the guy above you and below me is wrong.
  • You are right, so am i, and the guy above you and below me is wrong.

    Actually, I was just providing information one could base an opinion on. Personally, I feel that in many cases the issues in the last paragraph can be expensive enough to make adding a bit more pipe or just clamping bandwidth during peak hours cheaper than metering.

    That includes low usage customers. You'd never notice the clamps since you're not a big consumer. High usage customers would likely use cron jobs to do their transfers at 3AM or just attribute the slowdown to heavy traffic (somewhat true no less). Any savings you might see based on your low usage would be eaten up paying for the overhead of actually measuring your low usage and billing every customer a different amount.

    There is a good arguement for simply offering broad categories of usage and using a traffic shaper to enforce it. Low use for the person who is primarily interested in email and light surfing, moderate for most people at about 33Kb and a high usage bracket providing DSL like limits. Possably a HAWG usage for people who do Napster 24/7. For the person who really is only interested in email, an email only account is also a possability.

    A well configured shaper would allow any category to burst to full capacity briefly and only clamp it down as it approaches the usage pattern of the next category. In the best case, the shaper would only go into effect if the usage would push the ISP's average peak higher or starve other users' bandwidth.

    Short summary: I believe there probably is room for multi-level flat rate service, but metering is probably too much of a pain.

    It is also worth noting that most ISP's now don't have any traffic shaping provisions. You'll notice that dialup users don't get committed rates at all.

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