AT&T promises to lower your Internet bill if FCC kills net neutrality

http://arstechnica.com/business/2014/03/att-promises-to-lower-your-internet-bill-if-fcc-kills-net-neutrality/

by hubtree • 12 years ago

5 5 12 years ago

Two things: First: So AT&T will lower your bill by charging data suppliers (Netfix, Google, Apple,...) for preferential access. Well what are these companies going to do: charge higher prices to recoup their higher expenses! Two sides of this coin: yes you pay higher fees for their service, but only users of Netflix/Google/Apple pay the higher fees. Everyone else is lower. So in a sense, this stops non-subscribers from subsidizing the subscribers.

Second: This "will help startups compete against more established players." How so? Now start-ups are going to have to pay for preferential access to serve their content too. Big players will always be able to outspend these startups and in a way reduce the exposure of any new service. This is not so good for everyone (well except the titans).

dragonwriter2• 12 years ago

Two sides of this coin: yes you pay higher fees for their service, but only users of Netflix/Google/Apple pay the higher fees. Everyone else is lower.

Once AT&T can charge the remote origin for timely, reliable delivery of data to end users on their network, what makes you think they'll restrict it to just the handful of most popular services on the internet? Why not apply it to everyone sending data to users on their network from points off of it?

Second: This "will help startups compete against more established players." How so? Now start-ups are going to have to pay for preferential access to serve their content too.

Well, as long as they are setting a popularity threshold before they start the "pay or be stalled" extortion, it'll make it easier for firms that haven't hit the threshold to grow against firms that have already hit the threshold.

(It'll also make it easier for AT&T's own content services -- at least when targeting users on AT&T's networks -- to compete against both established players and startups, because they'll never have to pay the extra toll, while established players will, and startups will know that it is coming when they get popular enough, and have to account for it in their model.)

dragonwriter2• 12 years ago

What they mean is that they are willing to give up $N you are currently playing to AT&T in exchange for $2N in new charges to the companies you are interacting with over the internet, who will pass that cost back to you, increasing your charge from Netflix, etc., from its current $X to 2N+X. So, you'll be paying more to AT&T in total, but less directly.

Of course, they'll use the additional money to offer you similar services to the ones that they are charging other people to provide you, and they'll offer you a lower price than their competitors can in the face of AT&T tolls -- say $X+1.5N.

ademarre• 12 years ago

Maybe it's time for Netflix to follow Google's lead and get into the fiber-to-the-home ISP business. If more big players on the side of net neutrality did this they might succeed in reinventing the ISP business from the inside out.

mynewwork• 12 years ago

Wolf promises to look after sheep if shepherd leaves them in open pasture.

AT&T promises to lower your Internet bill if FCC kills net neutrality

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