Many people want flatrate internet in South Africa where we pay about $36 US for each GB we use. Flatrate broadband is being offered by the likes of IS; at a price. (about $300 US per month, with high latencies and restrictions on P2P)
Imagine the following scenario. You and your mate go to the local shopping mall. He buys a pair of sneakers, a new DVD player, a present for his girlfriend and 3 books at the bookstore. You buy some new socks.
Both of you pay a flatrate of $500 per month for your shopping mall "subscription". I.e. you've just subsidized everything your mate bought. Do you think consumers and shopowners would buy into this concept of shopping mall subscriptions? Of course not!
So why on earth would you want flatrate internet, where the majority of users are subsidizing the excesses of a minority?
It used to be that the internet was about reading emails and surfing the web. These days it's about VoIP, IPTV, streaming audio, podcasts, YouTube and Web 2.0 applications. One person could be getting a lot more value out of an hour on the net than another!
It makes sense to me that the more you 'buy' at this new 'shopping mall', the more you should pay. Of course you should qualify for bulk discounts, but why a flat rate for unlimited usage?
I envisage a world in which everyone is online all the time. There's simply no point in charging for the time you are online. You'll be online from birth. Therefore, Skyrove charges per Megabyte. It's a natural differentiator.
There's a pretty much direct correlation between the value-add of most online services you use and the amount of bandwidth it consumes. Web 2.0 apps use more bandwidth than surfing, VoIP uses more bandwidth than Web 2.0, video uses more bandwidth than VoIP etc.
One of the main reasons we are given is that consumers simply don't understand the concept of MB. The sooner internet operators realise that consumers aren't idiots and that "Megabyte Education" isn't impossible, the sooner we're going to see more affordable internet access.
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2 comments:
Err, actually ACCESS to the network is the future of the internet, without any string attached. This is the result of bandwidths "Moore's law" the price drops by half every year. There is two reasons for this, the networks is a "sunk cost" meaning you have to "use it or lose it" to its capacity, otherwise you just wasted alot of money. The other one is trying to sell an super abundant SERVICE. Megabytes literally costs a very small fraction of a cent, so it becomes much easier to just charge an average amount(Which is still cheap). Also you obviously don't have a clue what the difference between a product and service is. It would be stupid as well as wealth destroying to refuse to extend further service that doesn't cost you anything to do so. The shopping mall analogy is also kinda stupid. The only way to use a shopping mall is from the owner and renters perspective. Imagine a mall is only 10 percent occupied, this is a result of high prices, of course the owner refuses to lower prices because he is the only one allowed to open one, thus no incentive. Another apt analogy may be a road.
If you look at broadband penetration, those with high numbers have flat rates and real costs in the fraction of cents per MB. While the metered ones is very low and high real costs per MB. So restriction and regulation just drives the cost up, resulting in vast inefficiencies, while a free network uses the available resources very effectively.
I agree, the shopping mall analogy isn't too good. Roads is a better analogy. I.e. more cars will mean higher costs to maintain the roads and that bigger roads will need to be built. There is already a road tax built into the price of petrol in most countries.
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