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FCC Chairman Julius Genachowski has some short words for Internet providers that want to charge customers by how much bandwidth we use: Go right ahead.

“Usage-based pricing would help drive efficiency in the networks,” Genachowski told the cable industry’s annual confab NCTA, in Boston Tuesday, according to +Reuters.

Your thoughts?
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86 comments
 
On what planet does he live on.. BAD BAD FCC BOSS
 
He forgets that he works for the people, not the ISPs.
 
I'm guessing his boss has scheduled a fundraiser with some telcom heavy hitters.
 
Most people still have a 10GB cap here in New Zealand.
 
isn't that what they do already? Companies offer tiered plans based on how many megabytes per second. The worst thing to do would be to adopt the UK/Australia/NZ model that charges you for every single speck of data you use, including routine windows updates, page loads, etc.
 
That's BS!!! next they will start charging for hours of watching television.
 
That's speed +Ben Bucher, he is talking amount of information that is downloaded, not how fast.
 
Don't improve the efficiency, just use limits. These people insult my intelligence. Is that the way to the future...?
 
Wow, I used to actually like the guy.....UBB? Look at Canada to see how well it worked up there. It won't drive efficiency up....at all. Prices will increase simply because the ISPs will have the ability to do so while either dropping the caps down or increase the price while keeping the caps the same. Look at the wireless side of the house as well to see the pricing structures currently in place and how much consumers aren't happy about it.
 
I lived in Australia. The caps are ridiculously low. Then, when you go over your cap, they throttle your speed back to a virtual crawl so that the internet is basically unusable.
 
It's amazing isn't it? I have a feeling we are poised to come up with some more options to stay creative, as in creating things. The history of taking essential resources water, energy, etc. (which the internet is becoming... slowly) and ensuring people must 'pay' to use them is old paradigm, old world. The internet as a resource is beyond the current powers that be.
 
I know that total wireless have been tried before. However, it is my hope that a company like Google even in association with other players like MS, that they will set up an entire WiFi system, for communication, smart phones and even as a cable replacement. No more wiring of any sort, it would be so beautiful. Am I dreaming?
 
I would be in favor, only if ISPs were regulated along the same lines as electrical utilities, whereby they would be required to justify the rates and would be subject to yearly reviews.
 
Maybe if we had real competition (like in Europe) we wouldn't be getting f'd by telecoms all the time.

When the invisible hand is left to its own devices it likes to make a fist and insert it forcefully in consumers' rectums.
 
I am not worried as there are a few options: DSL, Sonic.net (where available), Google Fibre in Kansas, FreedomPop for wireless (half a gig free), Clear.com, StraightTalk for 3G wireless, etc. Also, the Comcast cap of 300GB is pleanty for me. I am pretty sure I am not exceeding 30GB and I watch Netflix online.
 
+Jake Miller I must've missed that chapter in Wealth of Nations :) I'd love to see that graph though.
 
I'm pretty sure you should be worried Rajiv. Just because you don't hit the limits now doesn't mean they won't bring those limits down and try to force even light users to pay more. It would be one thing if they actually 'needed' this money to build out a better infrastructure and provide better services. But in reality this is just to line their pockets even more. Time to step it up #google and use all of that fiber you have purchased.
 
Once again the government is allowing the cable companies to gouge their customers. There is no reason why cable companies need to gouge everyone for the heavy use of a few people. If they do anything, they should set a high personal use limit that migrates automatically to a commercial rate when a certain limit is reached on personal use. All personal use shouldn't have to suffer for the over-usage of a few people.
 
If all things were equal then this is a great idea, it will drive competition. But the last mile delivery is not always competitive. In my area I have my choice of Very expense but fast Comcast or Moderately priced DSL option that are 1/10 the bandwidth. I could see where Comcast could justify 10 fold charges that would scale against the slower providers. Can not see how that drive network efficiency unless the DSL providers drop their cost. That is not a likely event.
 
+Alexa Antonaras I just sent my comments to him. It would be a miracle if any of the "officials" in the government would listen. Most of them are being paid off by big business anyhow.
 
Pay for what you use. I like that. For everything.
 
+Arthur Baynes +Arthur Baynes It is a more complex issue than your statement. Firstly, small businesses will suffer. Pay as you go is counter to the idea of having shared services open to the general public and therefore commoditizes access based on what you can pay. As long as you have a lot of money, you will be able to get as much access as you want. There is something to be said for fairness when it comes to phone service, electricity asite nd other core services where regulation keeps people from being gouged. I'm not saying that those companies that are using huge amounts of bandwidth shouldn't pay for it, but personal and small business accounts should be a little more regulated to avoid the requisite gouging that is bound to happen when cable companies can set up counter billing.
 
The artificial scarcity issue created by usage based billing with broadband is one of the least favorable approaches to dealing with funding the infrastructure and combating congestion as it puts the burden on the consumer when there are more approaches to dealing with the issue of bandwidth needs.

Public Knowledge wrote an insightful whitepaper on usage based billing and cap potential issues, but it barely scratches the surface and possible side effects. http://publicknowledge.org/know-your-limits-considering-role-data-caps-and-us

The usage based billing would be damaging for new businesses that are bringing together idle resources for volunteer computing and other peer to peer technology which is highly efficient for distributed storage and more.

We could avoid many bottle necks in bandwidth for heavy lifting using mesh network topology using wifi end point peer to peer connections for an entirely distributed Internet and then the traditional hub and spoke model for the low latency delivery... this would disrupt the communication industry and have to roll out over a period of time. There are so many other approaches which shift the design of the Internet and new models of business would be created... think outside the box.
 
+Robert Wendel I agree with you, mostly. Businesses should probably be on a different tier of service. For an average consumer, though, this could be a money saver.
 
To everyone who likes this idea - it sounds good until you look at companies like Bell Mobility who charge there cell phone users $52.10 per megabyte if you don't have a data plan.

I can guarantee without a shadow of a doubt pay-per-use fee's will become the highest priced internet bandwidth the world has ever seen. You think your $50 per month bill is bad now, 5 years after pay-per-use fee's come out you'll be spending $200 per month.

That might seem crazy but its not, more and more people are consuming bandwidth faster and faster some examples of this are using services like Netflix, renting movies on YouTube, downloading 20GB games like WoW.

These big companies know that as time goes on bandwidth usage will naturally increase from things like online gaming, online movies, ect... so they'll release a pay-per-use fee now, provide you with slightly lower prices for the first year and increase fee's non stop year after year until your paying $200/month or more, they'll eventually stop increasing the prices eventually but by than we'll never again see a decent pricing structure.

By then it will be too late.
 
It shouldn't be based on how much usage. That's like charging me for every minute that I'm on my phone. And by the way internet is still dail up they just split the lines so you can be on the phone and still be connected to the internet.
 
Open the pipes! If competitors can't access the same wireless, or phone and cable lines then this is a terrible idea. Competition breads innovation and that in turn creates lower prices. Usage based billing without competition just means a price increase to consumers who will be stuck with current rates and increased fees for usage. We went from a country of thousands of ISPs to only 2 or 3 broadband providers in most markets if your lucky.
 
This is the most insensitive, anti-consumer administration... They get paid handsomely, get incredible perks, eat, drink, and make merry on the public's dime...while people's wages go down, the cost of food, gas, and taxes going up, and they say the cost of Internet service can be metered! A smart professor once explained to his classroom the difference between the leaders of The Roman Empire and Socialists. Socialists are insensitive to the people they govern. This observation may appear irrelevant; I think it is. I think an enterprise can rent this administration. The rest can be inferred.

 
How is paying for a service "socialist"?
 
So much for those of us without college/trust funds having the ability to user internet business (of the ethical/legal variety) to better their lives with little-no money down... I would still be in my one room apartment if something like this passed back in the day.

As long as the rest of the world didn't follow suit, I would completely pull an Eduardo because of this...
 
The cost of a network scales with the peak aggregate bandwidth, so charging based on usage (i.e. number of bytes transmitted) makes no economic sense. Low-bandwidth usage in non-congested times is essentially free. High-bandwidth usage during congested times should be charged more. This is hard to implement but if the FCC is looking for a economically sound pricing scheme.....

And of course, the price should not depend on source and destination of the transmission.
 
Internet should be FREE! It's like public roads. Make them FREE!
 
Julius Genachowski should pay for SHUT UP YOUR FACE.
 
+Grey Geek Finally someone who understands not only the history but sees the dangers in the cable companies' usury pricing schemes.
 
Yes , +Chris Harrison, we pay taxes for nearly everything made by man or God.

We pay for making money, investing it, giving it away. We pay taxes on what we drink and much of what we eat. We pay taxes on movies, videos, and audio. We pay taxes on books, magazines, maps and comic books. Even pencils and paper. We pay taxes on our cars, cycles, bikes, bicycles and tricycles. Taxes on bottled water - water that keeps you alive, is no exception. Beer, wine, whiskey, rum - and even every variety of fruit drink. Or how about clothes? Undergarments? Just to walk the streets civilized, and soap to be clean, we pay taxes. And where a tax for conjugal copulation is found difficult to exact, we pay fees for this and anything else our grandparents and parents could once do for free. And this is just a sample of what we pay.

Our children pay a number of these taxes, too. There's hardly anything a child isn't taxed for. So much for representative government.

And in light of all these taxes, I imagine there will be one for metered breathing one day because 'they' never have enough.

 
Can someone explain to me the point of increasing SPEED, and then capping total download? That has to be one of the biggest D-bag things any ISP can do.
 
The FFC and the entire band of idiots should stay out of the markets entirely.
 
How about he try to do that with the cable industry so we can stop buying packages that we don't necessarily need?
 
+Pat Pope , you don't have to buy anything. If you have any lack of variety or choices, blame the FCC, not the market. The FCC (alongside the rest of the moronic alphabet soup agencies) is the single most destructive force in the 'communications' industry and serves no one but themselves and large companies. They do not serve you.
 
+Dave Petrie That's just one more reason why the pay-per-use is such a horrible model to follow, as the years go on our internet speeds will increase, heck I still remember using dial-up 28.8K YEAH!!

Because of that increase people will be able to view more, see more, do more, which translates into increased bandwidth usage which if they get there way translates into outrageous costs for the consumer.

They Cap your total downloads and claim its because our infrastructure can't handle it when it has a lot more to do with making their CEO's another few hundred million in bonuses.
 
+Antonius Maximus Kinda of agree. FCC has failed to make the market competitive and therefore we have the silly package deals foisted on us by Comcast and its ilk.
 
+Steve Tjiang , the FCC has prevented the market from being competitive in the same measure as they create regulations and interfere with it. Want to see competition? Delete the FCC. And with it go licensing for spectrum and all sorts of similar stupidities.
 
And his quote is precious: “Usage-based pricing would help drive efficiency in the networks,” Genachowski said. Dude, you mean customer and business determined pricing? Or do you mean 'usage' as the only 'good' model? Here's a thought: The most efficient 'pricing' for anything is demand-based (usage). What a goober. What will drive efficiency is people being able to come up with new ways to interact. Stay out of the market.
 
"..has some short words for Internet providers that want to charge customers by how much bandwidth we use: Go right ahead." Really? I appreciate you are paid with stolen money to have useless opinions, but how about this: I don't need or want your permission. My customers and I will come to voluntary agreements without requiring or desiring your involvement. If my customers are unsatisfied, they will find someone else with whom to enter into a new agreement.
 
+Antonius Maximus Exactly boy-cot this crap every chance you get, if your ISP say's to you there charging on a pay-per-use scale, phone them say SCREW you I'll never agree to those terms cancel your service and find a different ISP.

Unfortunately I understand in smaller communities they only have one or two ISP's to deal with so the above wouldn't exactly work for them but bottom line consumers have power when they band together.

Anyone remember the AACS encryption key controversy? A digg user posted a CD key that got removed by a digg employee and the entire digg community revolted taking over the site making every single post the cd key, afterwords they shut down the site for a short time because of it.

Companies shouldn't under-estimate the power consumers have when there pissed.
 
+Neal Bloome , you have 'the market' figured out well beyond anyone at the FCC or any state worshiper. The consumer has all the power. Always, and forever. Even 'monopolies' are not possible in the free-markets. They only exist because of government protections.
 
+Grey Geek , if market entry by competitors is prevented by government, then all manner of perverse distortions can occur. Even monopolies. As long as you are dealing with a government controlled or heavily regulated market, market-based objections or outcomes can not be used as arguments. You're not dealing with a free-market. However, taking your point, I'd argue that a "JOE" is academic. Customers can not be forced to pay 'any price'. Customers decide pricing, not producers.
 
“Usage-based pricing would help drive efficiency in the networks,” seriously?
 
+Mohammed Al-Barrak , and remember, because he is an anointed bureaucrat his words and wise and blessed. (That idiot knows less about economics than my 4yo daughter. I wouldn't hire this fool to manage a taco-stand for fear of too much 'policy' in the tacos. It is no surprise to me the marketplace has rejected him and he has no where to go except "work" for the government.)
 
Charging based on use, in and of itself, is perfectly reasonable. But what they've always done is set a base rate for "X" amount of service (since they feel that each user owes them at least that much) and then tack on exorbitant overage fees. For example, if they charged the same rate per minute, my last cell phone bill would have only been $4 more instead of $150 more.

What would be equitable is a rule that communication companies cannot charge more for additional bandwidth/minutes/etc. than the monthly fee divided by the quantity in the plan.
 
+Dee Holtsclaw , "What would be equitable is a rule that communication companies cannot charge more for additional bandwidth/minutes/etc. than the monthly fee divided by the quantity in the plan." Perhaps. Perhaps not. But what is certain: Making a RULE forcing, at gunpoint, the market to obey this proposition is not the answer. Customers will decide.
 
Customers can only "decide" when there are alternatives. I realize this isn't the topic (e.g. cell phones) but they are a good example. In my area, there are only 3 carriers which have coverage. All of these have fee schedules as I described. Not much to "decide" there. Ditto for broadband service except only 2 options.

I never suggest legislation, rules, etc. unless it's something that is truly in the public interest. I'm all for letting competition sort it all out ... when it's even remotely possible for that to happen. But there's nothing wrong with forcing companies to play fair once it becomes obvious that's the only way to ensure fairness.
 
+Dee Holtsclaw , your lack of choice is because of government interference. Asking for more interference is unlikely to help.
 
+Dee Holtsclaw , "But there's nothing wrong with forcing companies to play fair once it becomes obvious that's the only way to ensure fairness." Yes, there is something wrong with forcing them. Just as there is something wrong with me using force against you because I don't think you are a fair person. If you don't like the way the 'play', don't pay them for their services. Don't like Wal-Mart? Don't shop there.
 
While I understand the need for efficiency in the networks, I think that for those carriers that choose to do this, many consumers will jump ship.
 
+alias inkhorn actually not so much. I got your point...it's just that I'm pretty exhausted with people's point of view on how this government may display socialistic tendencies or even why socialism is all bad.
In any case.. I did take the point to its extreme conclusion by oversimplifying it :)
 
+Arvind Gautam, truly no problem. Some times extenuating a point or adding a dash of hyperbole, or whatever, is a good tonic in discussions :)

As regarding socialist tendencies in the present administration, even my old friends from former communist countries see the present predilection and propensity for it here. As former communists, they have an uncanny ability to smell it (true communists hate socialists).

Now, less you think because I am friends with these former communists that I appreciate communism, I don't. I hate communism. For that matter i hate socialism, also. I call these people my friends because we'd sit in the evenings at some outdoor cafe and have scandalous arguments and dreadful 'wit lashings :)) It was like going to the gym for a cerebral workout :)

But unlike the Left back in the States, these people had intellectual integrity. They were honest about what they are - and I was honest about what they are, too :) The best part of all was that I could reason with them. There were many times someone would eventually acknowledge publicly or privately I was right about this or that - objectively right. In the states, my experience has often been quite the contrary. But usually they at least become more respectful in conversation :)

I know many in Europe that loved our country for its freedom - the absence of a meddling old mother-in-law style government - and the chance to be a success here because they dared themselves to be.

Not anymore. At least not now. One friend from Eastern Europe living in New York told me, 'Now that I'm a success the government owns me like the communists did in my own country!' Not as bad as he thinks. I joke and tell him, 'At least you net a little bit more after all your Federal, State, and City taxes, bridge tolls, and personal expenses.' :)

People i know or know about mock the president for entirely different reasons than they did Pres. Bush. Where they thought Pres. Bush was dumb, they think Pres. Obama is a fraud, and no more different than any corrupt politician in their own country (which is an extremely insulting comparison). Stunning, since nearly all these people were cheering for Obama 4 years ago.

I just realized how terribly long this is. My apologies and best regards.
 
He will be working at Comcast in 6 months then
 
If there is open access by all ISP's to all buildings, I reckon pay for use would work. But with zones currently locked down to as little as 1 supplier - No way!
 
If there was equal coverage it would make some sense.
 
Just look at his face and hair... and that stupid grin. He obviously doesn't know what he's talking about
 
+Miles France Would you rather have cable and wireless companies charge by usage or increase prices for everyone? Also, the fact that internet access providers have not increased prices for everyone means there is enough competition that prevents them from doing that. Another point, if FCC can’t control how much IAPs can charge for unlimited data usage, why should consumers expect them to impose bandwidth caps.
 
+Randy Liddil , the Wall Street Journal had an article also on this news. Near the end of the article it reads:

"Republican lawmakers expressed hostility toward the FCC's actions Wednesday. Rep. Joe Barton (R, TX) and Rep. Cliff Stearns (R, FL) demanded Mr. Genachowski explain why he didn't think he had authority to enforce net neutrality in May but now believes he does. Meanwhile, House Minority Whip Eric Cantor (R, Va.) promised lawmakers would "conduct rigorous oversight and explore all our legislative options to put things back on the proper track.""

The move by Mr. Genachowski is not his, it reflects the White House. And following Washington politics for a long time, more than likely a view has changed because of campaign money. Time will tell.

I've not the time to fact-check a comment by txpatriot on a stopthecap.com post yesterday [http://stopthecap.com/2012/05/22/consumer-groups-question-fcc-chairmans-endorsement-of-internet-overcharging-schemes/], but I found it very interesting. I recommend reading it.

I'm shoulder to shoulder with +Antonius Maximus regarding this news. Customers can 'balk and walk'. And I've learned from key employees at Verizon and AT&T, the market is too competitive between all the service providers for any of them to be 'clever by half'. The wicked little twist is the FCC putting its 'finger on the scales', making good commerce bad : )

In the meantime you might want to read "Why bandwidth caps could be a threat to competition" [http://arstechnica.com/tech-policy/2012/04/why-we-should-worry-about-the-decline-of-the-unmetered-internet/]. I was disappointed it didn't get more attention on Google+ last April. It's worth the time to be informed.
 
Before they go and charge per usage I think they need to take into account things like streaming movies and such.
 
It is impossible for a consumer to be informed on bandwidth usage and to be in control of their usage. How many people replying to this post know how many gallons of water they use to wash their hands, do the dishes, or take a shower? Water being nearly free drives improved sanitation. If it were as expensive as, say, milk, many would forgo washing their hands with clean water to spare the expense.

If information became expensive, many would become poorly-informed. We cannot compete as a nation without a well-informed populace. Capitalism's function depends on this as well. So, as bandwidth gets more expensive, users are actually less equipped to shop for a better price. It's a feedback loop, and we all lose.

It's almost as if certain entities have a stake in how poorly informed American consumers are. They want our only source of information to be broadcast. As it is, upload is more expensive than download, incentivizing mass-media distribution of content. Putting something in place like this wouldn't kill the internet, just make it so that people don't use it as much. Is that really what's best: using the internet less?
 
another way of pimping consumers
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