Date: November 11, 2005 10:10:40 AM EST
To: "'economics of ip networks'"
Subject: Re:Vint an interview you did with me in 1997 is beingquoted on Nanog as reason to support the current so callednet neutrality bill
Reply-To: economics of ip networks
Gordon,
today, you are typically charged based on the maximum capacity of the access circuit you "purchase" - that's flat rate. At the time (8 years ago) people wanted to have the burst rate but didn't want to pay for the unused capacity so we instituted a tiered pricing system that allowed them, e.g., to burst at 45 Mb/s but only pay for the effectively used capacity. As I recall, we used something like the 95th percentile as a measurement of capacity used - in other words, you paid for that capacity below which 95% of all sampled rates fell. I don't recall all the details but there may have been a fixed/variable structure. A fixed amount for having access to burst capacity of a certain size and a variable amount depending on average rate. the implication is that if you purchased a burst T1 and used half on the average you might pay less than if you purchased burst T3 and used only a half T1's worth. The somewhat higher charge would be a consequence of having access to a higher absolute rate/capacity. This idea may still have legs today although as speeds increase, and prices fall, it may not be nearly the same issue as it was eight years ago. You might ask MCI and other ISPs what their pricing structures are today for some perspective.
I do not see that tiered pricing is a neutrality threat. Neutrality has to do with differentiation with regard to the actual content carried (or service provided). If ISPs were to inspect packets and interfere with those of competing application providers (voice, video), I would consider that a violation of the principle of network neutrality. One might think of the notion of neutrality as the 21st C version of common carriage although I hesitate to draw the comparison if only because of the complex way in which "common carriage" concept and rules have evolved.
vint
Vinton G Cerf
Chief Internet Evangelist
Google/Regus
Herndon, VA 20171
Any comments?
Any comments from anyone?
Subject: Re: [Latest draft of Internet regulation bill]
Date: November 11, 2005 12:58:40 AM EST
On Fri, 11 Nov 2005, Christopher L. Morrow wrote:
oops ;) my point wasn't that bandwidth wasn't necessary over X speed, it
was that the main motivator for consumer purchase was no long bandwidth
but price alone.
In 1997, Vint Cerf was advocating the necessity of usage based pricing
when he was still with MCI.
Although MCI has not yet made a formal announcement via a press release,
Cerf explained that "we are plainly discussing this with you, Gordon,
and your readers." The MCI move is the outcome of what Cerf describes
as a crunch between the Internet's flat rate pricing model and usage
patterns where both the amount of use and disparity between use by
applications has increased dramatically.
Will consumers prefer to pay higher flat rate charges for everything, or
prefer different pricing models when they access applications which
require dramatically different service levels to include the cost as
part of an application specific fee?
Begin forwarded message:
Date: November 11, 2005 9:11:17 AM EST
Subject: Re: [Latest draft of Internet regulation bill]
Be careful Owen - i think you may be falling into a libertarian trap - worrisome because I respect highly things i have seen you write in past.
Think about what you are saying: " Something to consider about this proposed "regulation"... It is actually
in many ways proposed "deregulation"
Yes it is indeed. It frees the duopoly to do whatever it wants. And Whittacre has said what he wants and what he will do quite plainly -- has he not? He will charge google and yahoo and skype for using his networks.
Here is how this legislation is being read in London at a public telco blog recently launched by DRKW the large investment bank:
"For all of our sakes lets hope that the telcos are not successful in their lobbying effort in the US. If they are successful, you can bet that your investment in the fixed telecoms utilities is safer but innovation on the internet is in jeopardy - which do you think creates more incremental future value in the world ultimately?"
Vint Cerf is on my economics of IP networks private mail list. The DRKW blog post partially cited above came in part from a public item comment of Vint's that i posted day before yesterday to my private list. It is fascinating that Sean Donelan whom I have known and respected since 1991 dug that 1997 item quote from Vint from my archives. Donelan: "In 1997, Vint Cerf was advocating the necessity of usage based pricing when he was still with MCI.
COOK Report: Recall the date. This is PRE stupid network and again VINT is taking the pre-internet pre stupid network telco point of view. I'll post this to my list and see if Vint has anything that he wants to say about this 8 year old opinion.
Owen, do you want some legislation that gives the CEO of ATT/SBC the world largest dinosaur a blank check to do as he wishes with *HIS* network. This bills language is HIGHLY deceptive. I too despise government incompetence but giving Whittacre a blank check is IMHO much worse. But don't take my word for it - check out DRKW's analyst's opinion. Fred Goldstein also has a pretty good analysis. I probably will not further respond to this thread discussion. Please forgive me but I am swamped with many things that demand attention.
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The COOK Report on Internet Protocol, 431 Greenway Ave, Ewing, NJ 08618 USA
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On Nov 11, 2005, at 1:38 AM, Owen DeLong wrote:
Something to consider about this proposed "regulation"... It is actually
in many ways proposed "deregulation". This bill removes more authority
from the FCC and state and local governments than it grants. It provides
a very minimal framework of regulation, then, except for taxation and
a couple of other minor consumer protections, says "The government shall
butt the hell out."
That's why I like it.
But Owen - what if getting evil gov't out gives Whittacre a blank check?
Owen