Dirk Harms-Merbitz <dirk@power.net> wrote:

...

What is the value of a packet? It is not even clear if packet crossing from your network to my network gives _me_ any value. It can as well be for _your_ benefit.

Nah, you originated the packet for reasons unknown to me.

Yeah? Even when that packet is the direct result of your earlier DNS request?

In a capitalist economy, price generally follows value.

Scarcity creates value, hence the desire to differentiate.

Economics 101 again. Scarcity does not create anything. It's merely a range on demand-supply curve.

Once I'm connected, however, transitting traffic through your network is the only thing that I'm interested in. Why else would I want to connect to your network?

You only interested in transmission at the point where you know _where_ to transmit. Before that you have _no_ idea you may need some specific destination. You don't know all URLs you will ever use beforehand. Thus, universal accessibility has permanent value.

That's because he has (implied) obligation to provide adequate service during peak usage.

An simplified example. Lets say I have a direct T1 between A and B. A starts to transfer 4 GBytes from B to A and uses 100% of the bandwidth. Then B starts another transfer of 4GBytes from A to B. Both now use 50% of the bandwidth and each transfer takes twice as long.

It is a gross oversimplification. Things do not work like that.

I can still telnet between the two locations, even play quake - the load is hardly noticable for short transfers.

Actually, quite opposite. The handshake has nothing like quick start, only exponential back-off; so it is more vulnerable than data transmission stage of the connection.

Connection costs are generally figured into non-recurring charges. They usually do not exceed costs of equipment and overhead.

That was my point. Why charge a higher _recurring_ fee for a faster connection?

Because the share of higher-level facilities needed to accomodate projected usage is more.

This is an example of patently meaningless analogy. _Every_ business (even pyramid scams) has some capital costs. So what.

Why meaningless? There's no way to get the money back out once the cable is in the ground or the chip is being fabricated.

And so there is no way to recover all money spent on building a rental complex or sent out to first level of the pyramid. It's the nature of investment, ok?

You will be surprised. Sprint has 6 (six) strands of fiber in its

How do you know?

I used to work there. --vadim