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You are here: Home / Economics / Free Markets Solve Everything / Captured

Captured

by $8 blue check mistermix|  November 9, 20118:09 am| 17 Comments

This post is in: Free Markets Solve Everything

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The FCC’s fairly weak network neutrality rules, which cut a deal with wireless providers by skipping neutrality on their networks while requiring it on wired networks, still aren’t weak enough for the money party, which is trying to push through a repeal in the Senate. The Obama Administration has promised a veto, so the regs aren’t really in danger.

If you want a preview of coming attractions if President Romney and a Republican Congress take over the Internet, look no further than Verizon’s new “Turbo” API. This API lets smartphone apps get faster connections on the Verizon wireless network, as long as the smartphone user agrees to pay extra for that connection. This is every telco’s wet dream: people paying extra pennies per minute every time they want their traffic to travel faster over the Internet, and gradual erosion of the baseline Internet speed so that everyone will ultimately want to pay.

Whenever I see a Verizon or AT&T commercial touting the speed of video on their new, fast LTE networks, I have to chuckle. If you actually used their network to stream a movie, you’d hit your data cap before it was over. Those companies want to sell their 2012 data speeds at 2002 prices, and right now there’s nothing the FCC is doing to stop them.

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Reader Interactions

17Comments

  1. 1.

    Bmaccnm

    November 9, 2011 at 8:45 am

    First world problems

  2. 2.

    Belafon (formerly anonevent)

    November 9, 2011 at 8:48 am

    We should deregulate the meat market, and then people can pay more if they want the inspected meat.

  3. 3.

    Walker

    November 9, 2011 at 8:52 am

    @Bmaccnm:

    Exactly. Developing nations like India have much better cell networks than we do.

  4. 4.

    300baud

    November 9, 2011 at 8:59 am

    Butbutbut… it’s the power of a free marketplace!

    Sigh. It is like we learned nothing from the AT&T breakup. Or any economics class that actually explains the preconditions necessary for effective free markets.

    The only reason the mobile space isn’t 5 times as terrible is Apple and Google’s efforts to pry things open a little. But Verizon’s “Turbo” API is a great example of how they are trying to claw back control.

  5. 5.

    terraformer

    November 9, 2011 at 9:09 am

    Lucky me – I ordered a new iPhone 4s and since my old 3G contract expired, AT&T (I know, I know – hi there, CIA!) grandfathered in my original “unlimited data” contract. Which they don’t offer anymore. They charge something like $135/month for 12G of data. And I get unlimited for $26/month.

  6. 6.

    jwb

    November 9, 2011 at 9:19 am

    @terraformer: How did you get them to grandfather the 3G contract? I have an old iPhone under the old unlimited data plan as well and am loathe to upgrade because I thought I’d lose the unlimited data plan.

  7. 7.

    beergoggles

    November 9, 2011 at 9:21 am

    This should become less of a problem as more places provide free access to wireless APs that we can connect to instead of having to use 3G/4G. How often do you use your provider’s network when at home or work where you can just flip over to your faster wireless network?

  8. 8.

    Walker

    November 9, 2011 at 9:26 am

    @jwb:

    Grandfathering is standard AT&T policy. I suspect it will go away once we see 4G iPhones, but for now it carries over.

    What you cannot do is break your contract; then you lose it. But contract-available hardware upgrades are fine.

  9. 9.

    Walker

    November 9, 2011 at 9:28 am

    @beergoggles:

    How often do you use your provider’s network when at home or work where you can just flip over to your faster wireless network that uses less battery?

    Fixed for what really matters to mobile users.

  10. 10.

    beergoggles

    November 9, 2011 at 9:44 am

    @Walker: I don’t have an iphone so I swap batteries on my phone on the fly. Never have to plug the phone in for recharging. Got into this habit because dual-core phones are just juice suckers.

    If that really mattered to mobile users they would never buy an iphone.

  11. 11.

    Woodrowfan

    November 9, 2011 at 10:07 am

    S**T. I need a new phone (mine is about 7-8 years old at least) and I like Verizon’s service. But damn, I don’t want the hassles of the new phones and data plans.

  12. 12.

    Villago Delenda Est

    November 9, 2011 at 10:13 am

    Large corporations HATE HATE HATE competition.

    It’s as simple as that. They will do almost anything to get rid of it and sit back with as close to monopoly control as they can get.

    Smith identified this trend 235 years ago. It’s still around.

  13. 13.

    beergoggles

    November 9, 2011 at 10:14 am

    @Woodrowfan: Try this: http://republicwireless.com/

    20 Bucks a month, hybrid calling. Use Google Voice for texting to bypass text limits. U do need to run a wireless network at home and hook into it while at home.

  14. 14.

    John Carter

    November 9, 2011 at 10:37 am

    The ads for Verizon’s new super fast 4G along with the data cap mean that you can now get to paying for additional download time because you an get there faster!

    If the older 3G took you a week of download to reach the cap, the new 4G might get you there in a couple of days.
    Win-Win for Verizon and a big loss for the customer.

    Budget your download? If you’re using 4G you really don’t have a choice. Everything you do will get Verizon’s limit faster for them so you get to pay extra.

    Imagine sex taking a good hour (It’s not unheard of!)and costing $20. You might even be able to get 3 sessions in at that rate. With the new Verizon Screw the same sex takes 20 minutes now but you still pay the $20 and might only get one good time. Want the other two? “Fork” over another $40!

    Great job by Verizon to get everyone hyped on faster 4G with those lightning commercials, then they added the cap, then they sold the quickie!

    Someone got a big bonus for coming up with that idea!

    Can’t wait for 5G where you go over the cap turning on your phone!

  15. 15.

    Martin

    November 9, 2011 at 11:03 am

    I would urge consumers to think not about their data speeds and their data plans as separate things, but as the same thing, because they’re related.

    So Verizon isn’t selling you a 2GB/mo data plan and an 8Mbps LTE plan. Instead they’re selling you the right to use their network for 34 minutes per month. That’s how long it takes to hit the data cap.

    What bothers me here is the marketing because Verizon wants to look generous at both ends “Look at how much data you can download!’ and “Look at how fast you can download it!” but put the two together, like watching a movie (which they advertise) and you’re walking into a trap because you can’t accomplish what they’ve advertised.

    I’d MUCH prefer to see these plans marketed as what they are – how much time you can spend online. If they want to boost their data speeds, they need to boost their data caps accordingly, because as soon as that new speed becomes expected by app developers and content providers, they’re going to take liberties with how much data they shove.

    Anyway, if you’re shopping for service, do that little bit of math just to remind yourself of what you’re actually buying.

  16. 16.

    Gromit

    November 9, 2011 at 2:37 pm

    If you want a preview of coming attractions if President Romney and a Republican Congress take over the Internet, look no further than Verizon’s new “Turbo” API. This API lets smartphone apps get faster connections on the Verizon wireless network, as long as the smartphone user agrees to pay extra for that connection. This is every telco’s wet dream: people paying extra pennies per minute every time they want their traffic to travel faster over the Internet, and gradual erosion of the baseline Internet speed so that everyone will ultimately want to pay.

    I don’t think this is a net neutrality issue. Net neutrality is about whether certain kinds of data gets priority on the networks, not whether certain end users higher bandwidth. Users paying more for faster/wider connections has been SOP in the ISP business since pretty much forever, and net neutrality isn’t meant to address this. Or am I misunderstanding something about what Verizon is doing?

  17. 17.

    Gromit

    November 9, 2011 at 2:39 pm

    @Martin:

    Point taken on the ads showing folks watching streaming movies, but to be fair, most online activities won’t saturate the 4G connection, so it isn’t quite so simple to calculate how much time you get online.

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