NNSquad - Network Neutrality Squad
[ NNSquad ] Re: Bell Canada proposal to cap wholesale customers
I think we're already living the grim broadband future.
One of the reasons I piped up: I used to think of Bell Canada as an ISP who "got it" and understood wholesale. Until this point I've only seen rate capping associated with providers who (I assume) collect most of their revenue from consumers or small business. A consumer/small business broadband network might be engineered for 100:1 even 300:1 oversub- scription. Wholesale networks might be oversubscribed 10:1 or as much as 50:1.
I might lump most of the cable guys into this group (they were very late in understanding the Internet or Internet backbones and often bought/buy at wholesale themselves).
AT&T might be an outlier, but then, they're so big that often one hand (retail/consumer) doesn't know what the other hand is doing (wholesale). In other cases one hand is much bigger than the other and wields much more power.
Companies who sell wholesale (XO and Level3 come to mind) as a large part of their business haven't been in the news and a few companies (Verizon) who sell both wholesale and retail haven't tested/implemented/mentioned rate capping at all. From what I understand, they have no intention of doing so.
In the absence of regulation preventing the practice, rate capping comes down to a trade-off. How many members of the marketing team become ambitious enough to gamble their customer base by rate capping versus how many clueful executives in the company stand up, willing to stop them. Rate capping in a broadband provider might be risky but the risk is balanced by the inertia of triple-play and the presence of a monopoly, duopoly. Is this fair practice? Only your favorite regulator can decide.
Rate capping by a wholesale provider means death as long as there are other providers to choose.
jy
On Apr 15, 2009, at 2:27 PM, Wes Felter wrote:
Russell Smiley wrote:Bell Canada has submitted a proposal to the CRTC to allow it to cap
bandwidth usage of wholesale customers (mostly independent ISPs). The
independent ISPs are concerned that this will essentially eliminate the
possibility of 'unlimited bandwidth' type offerings to their customers.
We should keep this in mind whenever someone suggests that open access or structural separation are the solution to broadband monopoly problems in the US. If you have a "friendly" ISP sending traffic over Time Warner's pipes, TW can still cap or throttle you and they would lobby the government to make it legal. If monopolies don't work and overbuilding doesn't work and open access doesn't work we could be in for a grim broadband future. Or maybe I'm just being pessimistic.
Wes Felter - wesley@felter.org
[ It doesn't need to be grim. But the complexity of the broadband environment (technically, economically, and politically) is such that "single-category" solutions are unlikely to be adequate in isolation, particulary when we start off with inadequate information about what's really going on. Historically, these are the sorts of situations where carefully tuned regulatory approaches have needed to be introduced and evolved over periods of time. The analogies between broadband access issues and past industrial controversies such as oil industry competition and railroads are not insignificant. To better understand the future, it's often very useful to pay closer attention to the past.
-- Lauren Weinstein NNSquad Moderator ]