Netflix Urges FCC To Crack Down On Broadband Usage Caps
from the pay-more,-get-less dept
We've long pointed how how broadband usage caps (especially on fixed-line networks) are arbitrary, punitive and confusing. In addition to being totally unnecessary, broadband caps open the door to anti-competitive behavior (like zero rating a company's own content but not a competitor's). The idea that caps are necessary to manage the network has long been debunked, and even the ISPs themselves have admitted that caps have nothing to do with congestion. Broadband caps are little more than glorified price hikes on captive markets, useful to protect legacy TV revenues from streaming video.Despite the profoundly negative impact of usage caps, most Silicon Valley companies remain mute on the subject. One of the few exceptions is Netflix, which not only has been a vocal opponent of caps, but has often taken steps to try and help consumers navigate them. Now the company is once again pushing the FCC to take action in a new filing (pdf), urging the agency to use its authority under Section 706 of the Communications Act to crack down on caps and overage fees:
Data caps (especially low data caps) and usage based pricing ("UBP") discourage a consumer's consumption of broadband, and may impede the ability of some households to watch Internet television in a manner and amount that they would like. For this reason, the Commission should hold that data caps on fixed line networks and low data caps on mobile networks may unreasonably limit television viewing and are inconsistent with Section 706.From there, Netflix is quick to reiterate that even ISPs have admitted that caps have no actual technical purpose when it comes to managing the network:
"Data caps on fixed line networks do not appear to serve a legitimate purpose: they are an ineffective network management tool. Fixed line BIAS providers have stated that data caps on fixed line networks to not serve a traffic management function. They have been described alternatively as a way to align customers' use of the network with what they pay. As a method of price discrimination however, data caps and UBP are redundant to the speed tiers that consumers are used to. Data caps and UBP raise the cost of using the connections that consumers have paid for, making it more expensive to watch Internet television. The Commission should recognize that data caps and UBP on fixed line networks are an unnecessary constraint on advanced telecommunications capability.Netflix (now technically the world's biggest pay TV company) notes that in addition to being unnecessary, punitive, and potentially anti-competitive, usage caps are simply confusing. The majority of consumers don't know what a gigabyte even is, and by nature will tend to pay for higher tiers of service they don't need just to avoid being penalized (something that's quite easy by ISP design). Netflix is also quick to note that even higher caps may not be sufficient as consumers slowly shift to 4K streaming (not to mention other bandwidth-intensive applications we haven't even invented yet).
The problem for Netflix (and any consumer who cares about usage caps) is that the FCC's enforcement or interest in this subject has historically been inconsistent at best. While the agency did manage to prevent Charter from imposing caps for seven years as a recent merger condition, the agency has consistently turned a blind eye while companies like AT&T and Comcast expand their own usage restrictions and overage fees. And while Comcast and AT&T may have recently raised their own caps to 1 terabyte to fend off possible regulatory action, there's no real indication that any broader FCC action is forthcoming.
While the FCC has hinted that it may include usage caps as part of a voluntary push for broadband "nutrition labels", it's not likely the commission will do much more than that (even though nobody is confirming meter accuracy). Whether it's the FCC's $300 million broadband availability map that intentionally omits price data, or the agency's failure to even mention the ISP practice of using bogus fees to covertly jack up advertised broadband rates, punishing or even highlighting the price gouging that goes on in the broadband industry on a daily basis has never been the FCC's strong suit.
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Filed Under: broadband, fcc, net neutrality, usage caps
Companies: netflix
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Something something, free market. Something something, regulation. My idealism is better than yours because the government is there to help/hurt people/corporations.
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What really bothers me about this...
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Re: What really bothers me about this...
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Federal Regulation...
The Dingo is in tha house!
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There are a lot of problems. I don't disagree with you. I just think there's more than one way to skin a cat.
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A better solution would be to set up a government controlled fiber network, then allow any company to connect to the network to act as an ISP. Lower the barrier for entry and let new ISP's form. It would be a costly endeavor, but nothing stops the US Govt from being one of these ISP's, or even charging a small rent to ISP's using their network, allowing them to recoup their costs, and even providing a new revenue stream in lieu of taxes. It'll never happen, because every ISP would have a temper tantrum, but it would do the job nicely.
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At a first approximation, having two providers of the same core technology over the last mile nearly doubles the cost of the connection, as it cost both companies the same to run in the capacity for the total number of customers, and and future expansion. This makes the physical connection a natural monopoly.
A new player may be able to enter a market, where their is an opportunity to carry out a technology upgrade, i.e DSL to fiber but they tend to become monopoly supplier of that technology, and drive the older supplier out of the area.
One answer to this problem is to logically separate the connection from the service, ala UK landline services, along with co-location of equipment at the nodes. As an example, this means that I have a choice of DSL providers, over the same copper, (being rural there is no cable), and get an unlimited service.
One exception to this natural monopoly is the mobile device network. In this case the Final mile is essentially free, being a radio link, and customers demand full coverage from each supplier, as otherwise the value of their devices is reduced by not being able to connect wherever they go. However in this case a cartel has formed, where they all offer about the same terms and conditions of service.
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So the cure for poison is to take more of it?
Free Market is the antidote. Regulation is nothing more than providing businesses one stop shopping to build an oligarchy. It is a shame that you along with the majority of other are so ignorant or posses Nelsonian-esque knowledge attitudes.
The corruption is so entrenched you are not even capable of fully comprehending it. You are a good example of the Dunning-Kruger effect, you know only just enough to survive your own illusion of superiority while doubling down on the stupid.
Regulation "created" this fucking mess and now you stupidly expect that it will resolve it.
Brilliant!
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Re: Re: Re: Federal Regulation...
One thing I've noticed about free market enthusiasts is that the last thing they want is an actually free market. The idea that someone needs to DO SOMETHING to stop the supply side from preying on the demand side is abhorrent to them. Why, that would lead to... regulation!
They claim we can take them to court. Litigation is a rich man's game, most of us not only can't afford it, the litigation itself needs to call upon existing laws and tort reform makes suing bad corporate actors harder.
They claim we can vote with our feet — AFTER the offenders have taken our money and there's no way to get it back.
And they claim that we could opt to do without. Where the service is essential to either social or business life, that option is not sustainable.
"Nyaah! You're over a barrel, now squeal like a pig!" is not the free market in action, it's antithetical to a free market.
In an actually free market there would be a balance between the demand side and the supply side with either actor having the choice to take part or decline to take part in a transaction without being forced to do so by a situation created by either side.
So... how do we go about creating that freedom in the market? Basically, we need an all-powerful referee to stop any biting, gouging, or hitting below the belt. Refusing to get in the ring in the first place is not the answer.
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"A free market is a system in which the prices for goods and services are determined by the open market and consumers, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority."
Don't most markets in the US meet this definition? When I buy a banana or a used car, is the price set by a government, or the banana/used car cartel, or is it set by supply and demand? Or do you have some other definition of "free market"?
In an actually free market there would be a balance between the demand side and the supply side with either actor having the choice to take part or decline to take part in a transaction without being forced to do so by a situation created by either side.
Are you suggesting that every service and product you come into contact with is managed by collusion among the market players? If not, then it seems to me that you have the option of various competitors. Each of them is trying to produce a product or service with characteristics and prices that will entice you to purchase. What's not free about it?
I'm excluding certain markets such as broadband (in some areas) and utilities where there really isn't competition or perhaps not meaningful competition.
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Don't most markets in the US meet this definition? When I buy a banana or a used car, is the price set by a government, or the banana/used car cartel, or is it set by supply and demand? Or do you have some other definition of "free market"?
It's actually set by the vendor. You then decide whether to buy the banana at the price set by the vendor or to go elsewhere to buy bananas. Funny you should mention bananas, though: http://www.law360.com/articles/633545/eu-high-court-backs-46m-dole-banana-cartel-fine
You see, banana price-fixing is STILL a thing.
Are you suggesting that every service and product you come into contact with is managed by collusion among the market players? If not, then it seems to me that you have the option of various competitors. Each of them is trying to produce a product or service with characteristics and prices that will entice you to purchase. What's not free about it?
Some markets are more free and fair than others, e.g. the telecoms sector in the UK. However, they're not completely free, e.g. the energy sector in the UK. https://en.wikipedia.org/wiki/Big_Six_Energy_Suppliers_(UK)
In a truly free market we'd each be able to haggle with vendors for the products and services they offer but the truth is that most of the big players fix the price and that's what you pay unless they're having trouble shifting it off the shelves. That consumers are willing to put up with this in, let's say, the fresh produce market, is due to the inconvenience for many of us in having to seek out farmers' markets where we're more likely to be able to be a bit cheeky. Okay, I'm being pedantic, and yeah, you've got me: I'm reacting to free market idealism in which free market = cure-all. To be perfectly honest it's impossible to have a truly, perfectly free market, but I'm not too bothered about that. I just don't like being lied to — or fleeced by an unscrupulous service provider.
I'm excluding certain markets such as broadband (in some areas) and utilities where there really isn't competition or perhaps not meaningful competition.
Competition does indeed keep you honest and I'm very much in favour of it. As I said, I'm just sick and tired of gooey-eyed idealists blathering on about how We the People could magically bring this about if we all just upped sticks and sodded off to pastures new, or something. It's not as simple as that, and that's the argument I'm making. What I've been calling for since I started talking about it here is a more open, more fair, and more free market in which We the People are not being screwed, that's all.
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Ahhh, now I remember. You use a different definition of "Free Market" than everyone else.
The existence of price fixing or collusion indicates that a market is a Free Market more so than not. A lot of the regulations in place in our current markets are explicitly designed to curb collusion and price fixing. A true Free Market would have no such regulations.
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Free market doesn't mean unregulated market. In fact an unregulated market is almost certain to not be a free market given enough time. If there are regulations preventing collusion, monopoly abuse and the like then it can be a free market via regulation.
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It doesn't? I thought that was right in the definition you quoted: ...free from any intervention by a government...
I've seen quite a few economists state that being free of intervention from government is the most important part of the definition of "free market".
I've also seen plenty of economists define a free market as one that is free from monopolies. I'm not sure I agree with that. Just because I am the only one providing the supply side of the equation doesn't mean that the market isn't following the laws of supply and demand, does it?
But, IANAE (I am not an economist), so it very possible I am wrong about all of this.
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I interpret that to mean supply and demand is allowed to operate freely. So you don't have things like price floors or tariffs. Regulations about, for example, collusion actually promote the operation of a free market.
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It's not, as such, but it would be an example of the forces of supply and demand operating freely, like that time I bought a fridge freezer from a Currys outlet that sells shop-soiled goods. I asked if the sticker price was fixed and the salesman said no. I haggled him down to £250 + delivery (£20). A giveaway for a Bosch!
What characterizes a free market (to me) is choice and supply and demand. If I don't want Yoplait I can buy Dannon instead. And they are both constrained in their pricing by the existence of their competitors - charge too much and people won't buy because they have other choices. The fact that I can't approach the teller and offer 79 cents for the yogurt instead of 85 doesn't make it not a free market.
Erm, yes it does. Particularly since you'll find other distortions, e.g. subsidies, in play as well if you dig a bit. That the market isn't free doesn't mean there's no market. Nor does it mean that the forces of supply and demand don't affect price; of course they do. Basically, as long as you've got enough choice and can afford the things you want, the lack of freedom in the market is not a real problem.
When you can't afford the things you want due to price-fixing, etc., e.g. medicines, then it's a problem.
A more fair and open market is easier to achieve than a truly free one, and honestly, I think it's what we ought to be aiming for.
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Erm, yes it does.
Now I'm confused.
Particularly since you'll find other distortions, e.g. subsidies, in play as well if you dig a bit.
I think it's worth noting that there could be a market that isn't 100% free but mostly operates that way. There may not be a market that is totally and entirely free from interference but that isn't a very useful standard to apply (IMO).
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Agreed.
The ability to haggle is a good indicator of the freedom of the market but it's not the be all and end all where freedom is concerned. Set pricing by vendors doesn't bother me that much if I can shop around but you may find that the subsidies and lock-in deals with suppliers artificially affects the price we pay for goods. When suppliers are constrained from shopping around to get a better deal from vendors, or from selling directly, that's not freedom.
We're mostly in agreement here; as I said before I'm reacting to that "magic of the market" trope. It really does annoy me.
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Supply and demand really is an incredibly powerful thing. However I think where it goes wrong is with some people thinking that the solution is to back off and let everyone do what they want without interference. Sounds nice, but that results in the powerful preying on the weak and uninformed.
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We've discussed this before, I believe.
Free markets do exist and have existed ever since humans started trading things with each other. The illegal drug trade is a good modern day example - it exists without any regulation at all due to the fact that it's illegal to begin with.
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"No regulation" does not equal "free market."
"No artificially imposed distortions" equals "free market."
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Phenomenal cosmic power, itty bitty living space
Phenomenal internet speeds! Itty bitty data cap that shuts off the pipe after use.
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FLOOD!
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The way I see it...
The FCC defines broadband as at least 25 Mbit/second downstream. To me it means that, since this speed should be available at any time (and not only during the first few days of your month), the volume promised by broadband is about 8 TerraBytes per month (25Mbit/sec speed * 2592000 seconds per month = about 8000 GigaBytes)
Anything less is not broadband.
Right?
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As we have seen quite often, these corporations have entire departments setup to handle 'high value' clients.
Direct lines to top VP's & troubleshooting teams.
Plans & Rates no one else can get without a pin identifying them as a member of Congress or being on a board.
Sweetheart deals on mortgages & loans.
Perhaps the better solution would be to outlaw providing different service or the acceptance of it by government.
Perhaps if they had to actually live like those they claim to represent & allegedly have the best interests of they might be a tad bit shocked how the real world works.
Think all of the state laws banning competition would stand when they cheerleaders are getting the same shit service they sentenced their constituents to?
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They create demand for your product and you haven't contributed anything while enjoying the benefits.
Unlimited usage is not the only option, but offering 'high speed' service that can hit the cap in 3 days of continuous use and then trigger hundreds of dollars of 'overage' charges isn't the right answer either.
What is required is honesty, and your case is different than ATT/COMCAST.
Taking state subsidies while ignoring connecting or repairing lines to force people on to higher cost more limited options.
Imposing caps to force customers off of DSL onto the 'all new fiber network' (that is still delivered on the same copper at the end).
Pretending that Google owes them money for using their pipes, that were already paid for by customers.
Bandwidth is not this super limited super expensive resource that only a few people are abusing hurting others. (Conditions may apply in AK & HI).
They charge more for people who use more, yet offer nothing to people who use less, while claiming it is all about fairness.
They manage to transmit their own video offerings for free across their networks, but somehow Netflix is harder to deliver.
Use of the internet has been growing for a very long time, and yet they managed to put very little into maintaining or expanding their network to handle the demand.
They took BILLIONS in subsidies to bring broadband to places they wouldn't otherwise serve... funny many of those places are still high and dry... and face laws keeping them from developing their own systems.
They get concessions and deals predicated on offering low cost access to poor people... and make sure next to no one can qualify to get it... but they can pay full price & get hooked up.
They want consumers to pay to not have their traffic spied on and get more ads inserted... costing more bandwidth pushing them to the cap quicker.
How much infrastructure would half of the bonuses paid the the CEO's of ATT & Comcast have created?
Alaska is a unique situation because it is remote raising costs for the network, but why someone in a major city is facing a 150gb cap on a 3mb line makes no sense.
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You are intentionally creating demand for a product where there is no actual shortage of supply. You are just being greedy and refuse to add necessary infrastructure.
Don't tell me that you to justify shit like your trophy wife's lavish vacations & clothing habits, your son's Lamborghini after he wrecked it in a drunk driving accident and a lawyer for your daughters drug induced bangbus debut.
Get a life you cuckold, because you are only making other people miserable.
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Try harder.
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tsk tsk tsk...
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What is the name of his ISP. Where is his website at least. What is their contact number. Where are they stationed. Who do they serve. Can he identify himself so I can see where he in fact lives?
Someone can start digging and see who uses this ISP if it even exists or is just some fake website set up to look like an ISP.
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The standard rallying cry that (insert tech thing here) owes us money for using our pipes has been around for a while. The dipshit who started it still hasn't put his money where his mouth is to pay Google's bandwidth bill for 1 month.
Rather than challenge the alleged ISP owner to fill in the blanks, its much more satisfying to shatter the claims and turn them right back around. I don't see ISPs paying Netflix for getting consumers to get more expensive plans to keep up with streaming.
Setting it in Alaska was to leave them an out, because Alaska can be very remote and costs there are not anything like what we see in 95% of the country. They might be using a very expensive microwave relay system or bad satellite link system that has its own costs and issues where they actually need fairness in bandwidth use. But using that as the basis for why the monopoly players keep screwing multiple cities & states with the empty claims of fairness and not admitting it is a cash grab shouldn't fly.
I've found its always best to answer with the details, debunk the stupid they owe me claims, and sometimes finish with telling them to go fsck themselves if they really annoyed me. This one wasn't smart enough to piss me off, I was more offended by the braintrust who posted a series of personal attacks, more than likely to create the illusion we just shout people with different ideas down.
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Did'nt get
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