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Wednesday, September 02, 2009

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Guilherme

Dr. Foreskin's diagnosis:We need to drill our own oil. That would cut that costs of gas enusmoorly. No need to invest millions of dollars in alternative energy when we have plenty of untapped oil reserves here in the US. Besides, by buying oil from the Middle East, we are funding the same terrorist groups we're at war with. It just doesn't make sense.

Ricardo

people think that electric cars are the fuurte because they require less maintenance. A car starts to erode as soon as you put any type of oil or fuel in it. Even if they where to raise electric prices it will never amount to the money that you have to spend on maintaining fuel cars.You should look at a movie call Who Killed The Electric Car. I saw this movie when i was taking a science class. it shows how electric cars were used way before we even had fuel cars on the streets. Also this movie shows what happened in California, when all electric cars where taken away from the public because they worked so well that the car companies could not make any money because the cars never needed maintenance.I would like to add that car companies intentionally make electric cars slow and ugly so you wont buy one.

DM

Michael,

Phillip Dampier over at Stop the Cap! wrote a nice rebuttal to this so-called “study”. You can find his post here: http://stopthecap.com/2009/09/03/assuming-facts-not-in-evidence-consumption-billing-higher-broadband-adoption-in-america/.

Points to consider from his critique:

1. ISPs can implement different speed tiers with different prices. A 5 mb/s speed tier has lower theoretical bandwidth consumption when compared with a 10 mb/s speed tier. The economics of the different speed tiers would dictate that as the speed increases, so does the cost. Therefore, a pseudo-consumption-based pricing model already exists within the flat-rate pricing structure that is currently being used.

2. The report relies on data that can be labeled as unreliable. For example, the economic and racial demographic data is not fully understood or explained. Some of the data is presented by parties who may have a vested interest in switching to a consumption-based billing model (Cisco) and Dr. Hassett and Dr. Shapiro foolishly supported data that was taken from a study that actually argued against consumption-based billing (EDUCAUSE report).

3. The report also cites data that is presented from an astroturf group known as the U.S. Internet Industry Association. Phillip is really good at identifying astroturfers and the financial motivations that telecommunication companies provide to them.

My thoughts:

If a telecommunication company wants consumption-based billing, then they should also implement this concept into television service. However, the industry seems to hate the idea of consumption-based billing for TV. A-la-carte television would only raise prices and would stifle the innovation of “niche” channels that wouldn’t gain support of viewers. At least, that is the argument that the industry has presented many times.

You would also need to introduce government regulation and oversight to ensure fair policies and procedures are being carried out. Remember all of those examples about the all-you-can-eat buffet, driving your car, electricity and water use? Well, those restaurants, gas stations, and utility companies are all regulated by the government. Telecommunication companies would then need to be added into the mix.

Telecommunication companies seem to want to have it both ways. However, consumers are too smart to be swayed so easily by some of these dismissive arguments. I highly suggest that anybody reading this checks out Phillip’s web site Stop the Cap!. It is a good resource tool and Phillip does a tremendous job of fact checking and analyzing the “industry speak” for what it is.

Josh Bozeman

By the way, if you read the report linked from this post, it becomes quite evident in the first paragraph alone that it's little more than liberal blabber.

Broadband adoption is lower among minorities? So what? The 75% black out of wedlock birth rate could easily be one of the main causes of that (as that would mean 75% of women are, at least part of their lives, single mothers with one income). Broadband access is a right? Hardly...is cable TV a right? Why is broadband a right? Broadband would spur economic growth? Among who? Those low income families without it? Not at all. It would spur growth among the cable companies, sure, but this ISN'T a money grab, right?

I'm not buying it.

Josh Bozeman

Clearly low income families cannot afford the expense of broadband, and even if you changed billing to usage, they still wouldn't be able to afford, but SOME might take away money from more important things they DO need in order to purchase the service.

Just because someone doesn't have broadband doesn't mean they need it, and it surely isn't a great idea to push people into services they probably can't really afford.

And how long do these low income families, who probably can't afford broadband at any price range, stay with the ISP before they pay their bill late and have their service shut off, or before they realize, "oops, we still can't afford that."

Those who have been with the broadband company who are suddenly paying more are the ones who lose out, and if stabbing your loyal longtime customers in the eye is a good idea, I say go for it. I just can't imagine many of your customers will agree.

This is all meaningless to begin with- broadband and dial up costs are too close today to matter. I could cancel my $40 a month insight broadband, but if I had dial up, I'd have to pay a min. of $25 for a landline (I use my cell phone as most everyone else these days), and dialup service would be at least $10 a month. A low income family short a mere $5 from broadband? If that's the case, pricing isn't the reason they haven't joined up.

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