Time To Face Facts: Broadband Caps Are Really About Protecting Video Revenue

[IOWA]

As various broadband providers drool over the idea of implementing broadband caps, they've mainly focused on the claim that they're doing so to make "bandwidth hogs" pay "their fair share." Sometimes they sprinkle this with claims of poverty over having to provide unlimited access to people who actually use it a lot. Of course, none of this is true. The various metered broadband plans almost always end up increasing everyone's bills, and there's little to no evidence that bandwidth hogs are a problem, either technologically or economically speaking.

For the most part, broadband caps are really about protecting video revenue. Many broadband providers these days also provide television, and that business is a total racket these days, with TV companies rolling in cash. Internet TV breaks up the artificial monopolies and the monopoly rents they can extract, so the last thing the broadband (and TV) providers want to do is make it easier for consumers to route around their television programming and access it directly on the internet.

As if to highlight that very point, Canadian telco giant Rogers decreased its already very, very low broadband caps just as Netflix announced that its streaming service was coming to Canada. The timing may be slightly coincidental, but it certainly highlights the point. Rogers doesn't want you streaming videos on Netflix if it means you might not watch Rogers' own TV programming.

Time To Face Facts: Broadband Caps Are Really About Protecting Video Revenue | Techdirt

 

[The_Gnome_]

Good article.

Brings up a valid point I've always wondered about a company like Rogers in Canada (and I'm sure there are plenty like them worldwide). Rogers provides internet access, as well as TV programming to customers - seems like they have a strong interest in keeping customers subscribing to their TV packages, so of course their best course of action to that end is to grossly limit bandwidth. Seems like a conflict of interest to me (or at least quite unfair to subscribers who pay for BOTH and want to choose how to consume their programming).

 

[mpw]

So if there is no technical or economic reason to cap broadband usage, and the only reason this is being done is to protect income from broadband providers own paid TV content services; why are broadband providers unlinked to TV companies also doing this? Surely they'd keep offering the unlimited plans and gain market share, all without damaging any other income stream to their own business?

 

[IOWA]

So if there is no technical or economic reason to cap broadband usage, and the only reason this is being done is to protect income from broadband providers own paid TV content services; why are broadband providers unlinked to TV companies also doing this? Surely they'd keep offering the unlimited plans and gain market share, all without damaging any other income stream to their own business?

Easy. Less investment in infrastructure = more ROI. Companies want to soak as much money as they can from us without investing. Besies, how many internet carriers do you know that don't have ties with cable/subscription tv services? I can't think of one in the us of a. Not one.

 

[mpw]

...Less investment in infrastructure = more ROI...

That sounds like part technical, part economic argument to me, which the original post was implying was not the case.

So the argument now is that those linked to paid video content are capping bandwidth to make people pay for their content, NOT because of any lack of investment which is the reasoning your saying the non-content providers are limiting their bandwidth by through lack of investment.

Doesn't that imply that the video content side ARE investing in their infrastructure to be able to provide the bandwidth for the content? In which case consumers are paying not just extra profits to these guys for their service, but paying extra for extra investment? Doesn't that sound reasonable; paying for a service?

...how many internet carriers do you know that don't have ties with cable/subscription tv services? I can't think of one in the us of a. Not one.

I'm not in the US so speak purely for my local market, where none, not one of the main three ISPs provide TV services.

 

[IOWA]

That sounds like part technical, part economic argument to me, which the original post was implying was not the case.

So the argument now is that those linked to paid video content are capping bandwidth to make people pay for their content, NOT because of any lack of investment which is the reasoning your saying the non-content providers are limiting their bandwidth by through lack of investment.

Doesn't that imply that the video content side ARE investing in their infrastructure to be able to provide the bandwidth for the content? In which case consumers are paying not just extra profits to these guys for their service, but paying extra for extra investment? Doesn't that sound reasonable; paying for a service?



I'm not in the US so speak purely for my local market, where none, not one of the main three ISPs provide TV services.

Simply put, no. How you come to that conclusion is simply beyond me. I guess you think bandwidth caps are a good thing too. Maybe we should just pay per hour like the early 90s?

And do you really mean to tell me ISPs over there really have no ties to tv services? Either through affiliation, subsidiaries, or parent companies?

 

[mpw]

Simply put, no...

Glad you've chosen to be so concise in answering whether you think it fair to be asked to pay for a service you use.

...I guess you think bandwidth caps are a good thing too...

I guess they could be, it would depend on the cost of the service I was paying for and my requirements: I can't just make sweeping statements that all contacts tariffs are bad because they limit my use without knowing what the alternatives tariffs/plans/contract on offer are.

If a reasonable price for an unlimited plan is 100, and there was a limited plan offering 50 for just 10, and I had a requirement of 49 and a budget of 200 then yes a capped plan IS a good thing IMO. Are you saying you disagree, and that my opinion is wrong?

...Maybe we should just pay per hour like the early 90s?...

I was at dinner with somebody last Saturday who has limited, but necessary(to them) requirement for internet access, they still use a dial-up modem, and they save a fortune over even the cheapest capped broadband service. For some the answer to your question would be yes; does this shock you?

...And do you really mean to tell me ISPs over there really have no ties to tv services? Either through affiliation, subsidiaries, or parent companies?

That seems to be a correct understanding of what I've posted above IOWA. Again, does this shock you?

 

[IOWA]

Lol no your taking my answers from one question and broadly applying them all all questions. Good job. Your colors are showing. Keep following me into threads though. Do you have a crush on me or something?

I guess your a stock exchange expert tooo, since you already know all the repsective companies affiliations and sub-properties. Keep going though, your credibility is already passing pluto. Nasa should take lessons on space travel that fast.

 

[twospirits]

be nice people. Thats all I have to say.

TS

 

[sebby]

And do you really mean to tell me ISPs over there really have no ties to tv services? Either through affiliation, subsidiaries, or parent companies?

A few of the UK ISP's are tied, mainly SKYor Virgin but from what I have read SKY are unlimited. But I can think of a lot more that are not tied to a tv service than I can think of ones that are tied.

My ISP is my electric, gas and telephone provider and as far as I know they have nothing to do with any tv services and my package is also unlimited
No I'm not with BT.

 

[lekky]

I'm not in the US so speak purely for my local market, where none, not one of the main three ISPs provide TV services.

UK? Who do you think the 3 main are?

According to this source [http://www.ispreview.co.uk/review/top10.php], the top 3 are BT, Virgin Media and Talk Talk.

Just checking Wikipedia on these:

Bt has an arm called BT Vision.

Virgin Media Inc. is a British provider of television, telephone and broadband internet services

TalkTalk Telecom Group plc is a television, home phone, broadband and mobile business

So the top 3 all have a hand in TV in some form. If we extend to the top 4, which includes Sky, then the top 4 all have something to do with Tv!

 

[IOWA]

UK? Who do you think the 3 main are?

According to this source [http://www.ispreview.co.uk/review/top10.php], the top 3 are BT, Virgin Media and Talk Talk.

Just checking Wikipedia on these:

Bt has an arm called BT Vision.





So the top 3 all have a hand in TV in some form. If we extend to the top 4, which includes Sky, then the top 4 all have something to do with Tv!

Oh snap, mpw proved wrong, again. Not really a surprise though... thanks lekky.

 

[mpw]

Lol no your taking my answers from one question and broadly applying them all all questions...

Maybe if you gave some sort of a clue as to which of the multiple questions asked you were actually answering it would be easier, but you rarely actually answer a question directly IOWA. So I decided to take your simplification of answer to be a general answer as if you'd understood the general tone of my post as a hole; I did this in part to give you the benefit of the doubt that you weren't just being as evasive as possible, suspecting that in being so you could later make claims that your piss-poor answering had been mis-interpreted. I wonder know whether I should just doubt what you say by default.

...Do you have a crush on me or something?...

Yes, I have a thing for huge cocks.

...I guess your a stock exchange expert tooo, since you already know all the repsective companies affiliations and sub-properties...

Sorry? Actually that isn't one of my stock answers; in fact I'm not sure that I've ever given an answer about the company affiliations of those ISPs.

...Keep going though, your credibility is already passing pluto...

Really, what in this thread damages my credibility?

UK?...

No, but what you say about the UK market is correct.

Oh snap, mpw proved wrong, again. Not really a surprise though... thanks lekky.

Oh snap, IOWA making false claims, again. Not really a surprise though...

Methinks you're digging yourself a hole looking for an argument you won't win IOWA, why not just stop now?

 

[Slug]

First point... please keep your personal vendettas/grudges off these forums. It may be mildly entertaining for those involved but to the rest of us it's a bore and a royal PITA. Stick to the point of the discussion and accept the fact that in a public forum anyone is free to contribute.

Second point.... in the UK there is regulation designed to prevent the situation described in the OP, where one content provider can gain an uncompetitive advantage. That's why the BBC, ITV, C4 etc (the main content providers or "programmers") are prohibited from offering ISP-type services. The likes of BT Vision and TalkTalk are no more a "tv company" than the outfit who supply my electricity (and also offer a tv service). They are resellers, nothing more.

It's quite probably that bb caps are being driven by video here, but to protect an increasingly inadequate backbone infrastructure unable to cope with the greatly increased demand for bandwidth rather than another revenue stream, which is already provided either by a licence to view (BBC) or advertising (ITV, C4, Five).

Note: Sky are a different case entirely as their own output is only available to subscribers

 

[LoyalServant]

Sorry peeps but I do find it all very curious.
Some point out infrastructure and that's plausible but in the states.... I don't think so.
During the internet boom telcos built huge fiber networks all over the place.
In places you would not expect there is fiber - and most of it us unused.
Existing active fiber also doubles in capacity on a regular basis as new tech becomes available.

I think it's a two fold issue.
One, if the telcos light all of that fiber up they are going to have so much excess capacity that it becomes cheaper
The other is the same issue as pointed out by the OP.

Telcos are getting into the TV business, look at AT&T - with their u-verse service.
Since they now have an interest in your cellphone, your TV and your internet access they are going to protect the portions that are profitable, and if TV is profitable they will cap your net so you don't watch it online.

Telcos have PLENTY of infrastructure.... they just don't want you to know that.

 

[IOWA]

[personal comments removed]

Now, back on topic. My theory still stands, and just makes the most sense, especially from a business and shareholder standpoint. It's all about that ROI, and they want to deliver less and take more.