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Article #41715

Re: Canadian ISP Makes Really Bad Decision

#41715
From: Calvin Ostrum
Date: Sat, 25 May 2002 22:18
148 lines
9130 bytes
In <3CEFF741.CDF6D000@sympatico.ca>
   Dave Smith <adavid.smith@sympatico.ca> wrote:


| The service agreement does provide for changes in its terms, but "the
| service" is "unlimited access to the Internet".

How is it that you get to exclude the nature of the access,
(for example, exactly what is meant by "unlimited") from the 
"terms" of the agreement?  What, for the nth time, makes you 
think that Sympatico is *required* to provide to you *forever* 
until you die precisely the same kind of access they have
offered you up until now?  Is there some legal issue here?
Or has Sympatico sold its soul to you with this service
agreement?

| Give your head a shake. They offered a service that caused a lot of people
| to abandon the competition's dialup services. Having reduced the number of
| competitors in the field, they now want to cut back on the service and
| increase the number of users of the system that they claim that we users
| have overloaded.

The people who abandoned dialup can go back to it if they want.  Or
they can choose many other ADSL providers or Rogers.  Of course,
many of those other ADSL providers already have caps and Rogers is
apparently planning a cap. 

| I beg your pardon, but they are still advertising unlimited access, and it
| would seem obvious that they are doing that in order to expand the number
| of users of their service.

This is one complaint you have that I do agree with (insofar
as it is true -- I haven't checked their pages recently).  If their 
decision to switch to a cap is a done deal, even if the service they 
are offering now will not be capped for a few months, they should be 
telling prospective new users about it.  

| This is the same service that they claim is
| being slowed down by excessive use.

Where do they claim this?  Exactly what do they claim?

| Yet, they continue to try to attract
| more users to their supposedly overloaded system.  The other possibility
| is that it is adequate for the number of users they have now, but that
| they are planning on converting hundreds of thousands of people over to
| their system.  With each of them paying the higher rates, it's all gravy
| for them.

Can't you figure out any other possible explanation for this?
I don't have all the facts myself, but I can imagine other
explanations.  Have you actually got evidence to rule out
this possible explanation: 

First of all, there are lots of people who would benefit
from high-speed access.  While the system is not is not
currently totally congested, it is running near capacity
so that new users cannot be signed up as it is without
risking bad congestion.  Either people's usage has to be 
reduced in some way, and/or money has to be raised to be 
able to increase the bandwidth (and this bandwidth increase,
over time, has to extend to all parts of the internet and
not just the part Sympatico can build) Money can be raised, 
of course, by signing up new users.  But it can also be 
raised by charging those who use more bandwidth to pay 
for that bandwidth.  Perhaps not enough money can be 
raised from new users, especially when many of those new 
users  will not be using a huge amount of bandwidth and
thus don't see it as worth switching if they cannot get
a package which suits them but instead have to pay the
same as very heavy users.  Given that bandwidth is a scare 
commodity, it makes sense that (aside from the existence of 
special needs) people should pay for the amount of it that they
take.  And that is essentially what is being proposed now.

It generally  doesn't make sense to give away a scare 
commodity for free, unless perhaps one can figure out 
some kind  of rationing scheme to avoid using prices.  If 
people have to pay for their bandwidth, they will use it 
more rationally.  That is what Hal Varian's research, which
I have brought up before and which has been ignored by
all the entitlement ranters, showed.  It showed that 
when there were small prices put on incremental increases
in use, people used a lot less.  They don't derive as
much utility from that excess use that others would
derive if they were allowed to get on and use that
portion of the bandwidth instead.  There are problems
applying this somewhat old research to the current
day, but at least it illustrates the principle.  It
shows that charging for amount used can be good public
policy, in just the same sort of way, for example, that
a progressive taxation scheme can be good public
policy.

| > The destruction here might be averted by raising the
| > cost on everyone.  But this, as I said, is not fair,
| > (even if it works, which it may not, since the light users
| > which subsidize the heavy users may be driven away).
| > One should be able to get a limited plan where one gets
| > less access for a lower price.  You claimed one could, and
| > I pointed out this was not the case.  If one wants
| > high-speed access, there is only the one choice.
| 
| I believe I said that dialup services offered different packages. There

No, you did not.  You did not explicitly restrict your
statement to dialup services.  You said:

| If you are not using the net much, you can buy more limited plans. Planning to
| spend more time on the net, I opted for the unlimited access offered by
| Sympatico. ...

This is just plain nonsense, of course.  You can spend as much 
time as you want on the net (in terms of time sitting in 
front of the machine) with unlimited dialup plans *and* with
the current Sympatico HSE.  And if you are not using the net 
much, you may still want to use it in a high-speed mode.  Probably 
even more so; if you are using the net a lot, you can for example 
read some web pages while others are downloading.  If you don't 
use it much, preferring to do other things, you may want to get 
on, download the pages fast, and not waste time sitting around.  
The issue of the desirability of high-speed is separable from 
both how much time you want to spend on the net and also how much 
total downloading you want to do.  But you don't even bother to 
separate these, and apparently insist on just telling those who 
want high-speed, but are not "using the net" as much as you, to be 
happy using only a slow dial-up line.   And you apparently don't 
even see what you are doing here.  

I give up!  I find the idea of network pricing schemes
quite interesting, and would like to see some rational
discussion of it, but I don't think we will be seeing
such a thing here...  anyone who knows of some good
elementary references on this subject though, please
let me know.

---------------------------------------------------------------------
Calvin Ostrum                                        cbo@interlog.com
---------------------------------------------------------------------
 To say altruism and morality are possible in virtue of something 
 basic to human nature is not to say that men are basically good.  
 Men are basically complicated; how good they are depends on whether 
 certain conceptions and ways of thinking have achieved dominance, a 
 dominance which is precarious in any case.  The manner in which 
 human beings have conducted themselves so far does not encourage 
 optimism about the moral future of the species.   
      -- Thomas Nagel, "The possibility of altruism"
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From: calvin_ostrum@yahoo.ca (Calvin Ostrum)
Newsgroups: can.general,mtl.general,ont.general,ns.general,chi.general
Subject: Re: Canadian ISP Makes Really Bad Decision
Date: 25 May 2002 15:18:17 -0700
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