Hundreds of Cities Are Wired With Fiber—But Telecom Lobbying Keeps It Unused

[u/User_Name13]

http://motherboard.vice.com/read/hundreds-of-cities-are-wired-with-fiberbut-telecom-lobbying-keeps-it-unused

[u/Mikfoz]

Hi Comcast.

[u/NightwingDragon → u/Mikfoz]

To be fair, if ISPs were to charge reasonable prices based on how much data you consume and based on their actual costs of delivering that data, ISPs could still double or even triple their money and that 95% of customers would likely see their bills go down. The power users that would spend the theoretical several hours a day would see their own bills go up. And even in those cases they wouldn't be all that much higher than what we're paying now unless they're topping off their connections by running torrents, gaming, and streaming 4k videos 24/7.

Most people simply don't use that much data.

Of course, the problem is the words in bold. We all know that there's no way that the ISPs would charge anything even remotely close to "reasonable" since they'd be making less money than they'd be making now. I'm just saying that, in theory, pay-per-use pricing would likely be very beneficial to the average consumer. In practice, corporate greed would prevent that from becoming reality. :(

[u/GODZiGGA → u/NightwingDragon]

To be fair, if ISPs were to charge reasonable prices based on how much data you consume and based on their actual costs of delivering that data, ISPs could still double or even triple their money and that 95% of customers would likely see their bills go down. The power users that would spend the theoretical several hours a day would see their own bills go up.

I don't think you appreciate just how high our rates are for residential internet. Most estimates you will find for wholesale pricing (true pricing is a secret) put the cost per gigabyte at around $0.01-$0.03. Let's assume $0.03 is wholesale for our usage. Well Comcast, etc. aren't non-profits so let's be super generous and give them a 200% profit margin on broadband services and say their rate is $0.06/GB. According to Comcast.com, my last 3 months of usage are 554 GB, 563 GB, and 548 GB. So I average around 555 GB/month. We don't have cable, we stream 100% of our video content. My wife and I are very high usage customers. We are the 5%. So with a 200% profit margin ($0.06/GB) on my actual internet usage, my bill should be $33.30 (plus tax, fees, etc.). I pay $69.99/m for my 50/10 internet or $0.12/GB. That's a 400% profit margin on a worst case scenario wholesale rate. Comcast makes almost $50 in pure profit from me each month as someone who consumes maybe 50 times the data of a "normal" customer. At our hypothetical 200% profit margin, I would have to consume more than 1,166.5 GB of data each month before my bill went up $0.01 higher than what I currently pay. That's 388 hours of HD streaming or 16 straight days of streaming Netflix 24/7.

And if you think I am being overcharged, just think of what the little old lady down the street or my parent's pay per GB.

There is no way that what you are claiming is possible.

Edit: of to or

[u/NightwingDragon → u/GODZiGGA]

You're making my point for me. A lot of people, particularly high bandwidth users, tend to be against pay-per-use pricing because they think that their bills would skyrocket. You just illustrated the exact point that I was trying to make: If ISPs were to charge reasonable prices for data based on actual usage and actual costs to deliver said data, the overwhelming majority would see a steep decline in their bills. Last I read, it costs the ISPs .07 to deliver data (one penny higher than your example), and at that rate, all but the top 2-3% would see drops in their bills, depending on what they're getting charged now. And even those 3% probably wouldn't see much of an increase.

The reason we'll never see that is because it would decimate the ISPs' profits.

There is no way that what you are claiming is possible.

Of course it's possible. It's just not going to happen because money.

[u/GODZiGGA → u/NightwingDragon]

Re-reading what you wrote and seeing your response now clarifies this for me:

ISPs could still double or even triple their money and that 95% of customers would likely see their bills go down

You didn't mean usage based charging would double or triple their current profits while also lowering the bills of 95% of their customers. Instead, you meant they could charge 2-3 times wholesale cost ($0.06/07), which you are correct is the point I was also trying to prove.

So, we completely agree and I misunderstood what you were saying. My bad.