Names like Prodigy, Delphi, and CompuServe mean little to the modern Internet user. In the dark ages before the Web and http came into being, the online world consisted of lots of text, a necessary familiarity with uuencode/uudecode, and metered access.
The more things change, etc. Time Warner Cable will bring back the past with a plan to charge subscribers based on their usage, according to Reuters. That test begins in Beaumont, Texas.
Time Warner Cable claimed five percent of its subscribers use 50 percent of its bandwidth. with Internet users receives the blame, with the problem worsening when more people seek video content.
However, one industry observer commenting on the Bits Blog thinks the clampdown has more to do with content than the actual, minimal costs of providing extra broadband connectivity:
Moreover, the marginal cost of extra bandwidth is very small, he said. For broadband Internet service, 80 percent to 90 percent of the costs are fixed regardless of use. And the all-in cost of a gigabyte of use is about 10 cents or less.“The smart people at Time Warner are scared of people watching TV directly over the Internet,” (Dave Burstein, the editor of DSL Prime) said. “‘Lost’ and ‘Desperate Housewives’ look better over the Internet than they do on digital cable.”
The real problem comes from the TWCs of the world thinking they should be more than just a utility, than just a dumb pipe delivering a service like electricity or water to the home. The telcos have lobbied hard throughout the US to keep municipalities from creating more services like Glasgow, Kentucky has for its citizens.
If more cities were able to implement plans that deliver Internet and digital television over electrical connections, Time Warner Cable and its ilk would not be so keen on pumping up the price for something that costs them pennies to deliver. Today would be a good day for people to ask their elected officials why their cities can't have an Internet utility.
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Municipal ISPs
David said, "Today would be a good day for people to ask their elected officials why their cities can't have an Internet utility."
I work for an 11 year old ISP in rural Kansas. Between the RBOCs slugging it out with cable companies on price and having to adapt from increasingly unprofitable dial-up services to rural wireless almost overnight, it's been tough to just stay in business. In the 16 counties in southeast Kansas where we do most of our business, not a single town qualifies as a "city," according to Federal standards. We're just too rural. All of these citizens want high-speed and they want it yesterday.
In one of the major towns (population about 12,000) where we've done considerable collaboration with the town to provide barely-profitable Internet access, the City of Coffeyville, KS decided to become a wireless ISP. They use Motorola Canopy, whose installed CPE cost is nearly $500, they charge the customer $49 to install it and $39.95 monthly. We provide live technical support, they provide email support. We get the rural customers who don't have line-of-sight to their access points and we get calls from their unhappy customers. It appears as though Coffeyville Wireless doesn't know much about managing their network and performance has suffered as they've added more users.
We can't compete with a town whose citizens tax dollars buy the equipment the town gives to rural residents to use. The town won't even discuss the issue with us, apparently preferring instead to slowly put us out of business there instead.
Our strategy is to build a carrier-class wireless infrastructure they and no one else can match and win back their customers. We've resorted to the services of a venture capitalist and put ourselves into hock for the next decade.
To suggest that people call their local city or town officials and ask why they aren't providing Internet services to its residents very short-sighted. A better solution would be to become the Internet franchisee in a town, not unlike the cable franchise. The problem most people have with this approach is that it kills competition which leads to higher prices and evolves into a limited monopoly — most people are not in favor of that.
Don Bledsoe
Terra World Communications
Independence, Kansas
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