[opendtv] Re: News: Netflix Partner Says Comcast 'Toll' Threatens Onli
- From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Thu, 2 Dec 2010 15:33:36 -0600
Dan Grimes wrote:
> In my opinion, if the data is increasing, and if the ISP needs
> to upgrade, and if their current fee structure is not covering
> their upgrade requirements, they should increase their fees to
> the end user. It is not right to charge the source but to the
> user (this is one of the biggest fouls with our taxation system:
> it needs to tax use rather than the income.)
>
> If it isn't fair for low quantity users to pay for those using
> higher quantities, it should be sold like a utility. In fact, I
> am already paying for a particular tier with Cox, opting for the
> lower cost 1.5 Mb/s tier (yet, with no maximum to the quantity).
>
> But as soon as ISPs are allowed to discriminate, you can
> guarantee that there will be wrongful discrimination.
Well, ... It depends how you look at this. I don't think that "muscle flexing"
is discrimantion. The ISP is simply saying, pay up or shut up.
Here is the way I see the economics playing out, and I think it is indeed very
fair. Although other schemes are also possible.
Netflix is charged more for carriage by the ISP, because they have been
determined to be proportionally a much heavier bandwidth hog than previous
content sources, like YouTube.
Since Netflix is a subscription service, they pass that additional cost to
their subscribers. Higher fees for streaming Netflix service.
Net result: the broadband connection fee for everyone remains the same, but the
Netflix subscribers, who actually use that disproportionally higher bandwidth,
indirectly pay more for their usage, via the Netflix subscription fee.
The alternative would be a more usage-based fee directly from broadband users
to their ISP. My bet is, no one wants to see that model taking hold. No more
than people want to go back to a per-phone-call fee for telephone service.
Bert
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