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What if carriers were forced to provide a package that gives access to the entire Internet, but also free to provide packages that makes streaming Netflix or Sp

What if carriers were forced to provide a package that gives access to the entire Internet, but also free to provide packages that makes streaming Netflix or Spotify free?

abakker 9y ago
While I have no conceptual problem with that, it only really makes sense if you pay for bandwidth. Right now, I pay for "internet @ speed". I think your model would work if I paid for "100GB of Internet @ speed". The argument against it, which I am O.K. with, is that the carrier would bias consumption toward established brands, and that would set up competitive barriers to entry for new companies. This would theoretically reduce consumer choice and decrease competition, eventually raising prices. (after all, if the carriers just recoup the costs from Netflix, they'll eventually pass them along to us.)
cestith 9y ago
Then YouTube, Pandora, and any little startup video or music streaming service is at a crippling disadvantage when Comcast decides to zero-rate stuff from Comcast, Netflix, and Spotify free. Which, by the way, won't happen. Comcast owns NBC, Universal Pictures, and a whole lot more. They own part of Hulu along with Disney, Fox, and Time Warner. They'll be zero-rating Xfinity On Demand and Hulu. Netflix, YouTube, and anything else they don't own will suffer from unequal market conditions in the large areas where Comcast has government-mandated monopolies. It's essentially government granting unfair competition to monopolies they already granted. Imagine if Ford or GM built toll roads, but customers who bought Ford or GM cars could pay nothing or some small percentage of full price to drive on those roads.
zAy0LfpBZLC8mAC 9y ago
That's ultimately just nonsense. Streaming Netflix or Spotify consumes bandwidth, and the infrastructure that provides that bandwidth costs money, thus, streaming Netflix or Spotify costs money. So, if someone is offering you "free Netflix streaming", you should ask yourself: Who is paying for it? If you are not paying for it, someone else is. The ISP certainly is not (they are a business and not a charity). So, obviously Netflix is paying for it. And as that's a cost for Netflix, and they, too, are a business and not a charity, they'll have to set their prices to cover those costs as well. So, in the end, you are still paying for Netflix streaming, it's just that you are paying for some of the bandwidth of your provider through Netflix. Now, so far that would be just pointless (you are paying for it anyway ...), but not anything necessarily wrong with it. Now, the question is: Why would anyone fight for and implement such a pointless setup? And the reason is that it allows monopolies to be established, and being a monopoly allows you to charge higher prices: If every streaming service could buy bandwidth to some ISP's customer at the same rate, which would also be the same rate that the customer would otherwise pay themselves, it would just be pointless all around ... so, what happens instead, is, that some parties buy exclusive rights in some form or another, which puts the competition at a disadvantage.

What if carriers were forced to provide a package that gives access to the entire Internet, but also free to provide packages that makes streaming Netflix or Spotify free?

abakker 9y ago

While I have no conceptual problem with that, it only really makes sense if you pay for bandwidth. Right now, I pay for "internet @ speed". I think your model would work if I paid for "100GB of Internet @ speed". The argument against it, which I am O.K. with, is that the carrier would bias consumption toward established brands, and that would set up competitive barriers to entry for new companies. This would theoretically reduce consumer choice and decrease competition, eventually raising prices. (after all, if the carriers just recoup the costs from Netflix, they'll eventually pass them along to us.)

cestith 9y ago

Then YouTube, Pandora, and any little startup video or music streaming service is at a crippling disadvantage when Comcast decides to zero-rate stuff from Comcast, Netflix, and Spotify free. Which, by the way, won't happen. Comcast owns NBC, Universal Pictures, and a whole lot more. They own part of Hulu along with Disney, Fox, and Time Warner. They'll be zero-rating Xfinity On Demand and Hulu. Netflix, YouTube, and anything else they don't own will suffer from unequal market conditions in the large areas where Comcast has government-mandated monopolies. It's essentially government granting unfair competition to monopolies they already granted. Imagine if Ford or GM built toll roads, but customers who bought Ford or GM cars could pay nothing or some small percentage of full price to drive on those roads.

zAy0LfpBZLC8mAC 9y ago

That's ultimately just nonsense. Streaming Netflix or Spotify consumes bandwidth, and the infrastructure that provides that bandwidth costs money, thus, streaming Netflix or Spotify costs money. So, if someone is offering you "free Netflix streaming", you should ask yourself: Who is paying for it? If you are not paying for it, someone else is. The ISP certainly is not (they are a business and not a charity). So, obviously Netflix is paying for it. And as that's a cost for Netflix, and they, too, are a business and not a charity, they'll have to set their prices to cover those costs as well. So, in the end, you are still paying for Netflix streaming, it's just that you are paying for some of the bandwidth of your provider through Netflix. Now, so far that would be just pointless (you are paying for it anyway ...), but not anything necessarily wrong with it. Now, the question is: Why would anyone fight for and implement such a pointless setup? And the reason is that it allows monopolies to be established, and being a monopoly allows you to charge higher prices: If every streaming service could buy bandwidth to some ISP's customer at the same rate, which would also be the same rate that the customer would otherwise pay themselves, it would just be pointless all around ... so, what happens instead, is, that some parties buy exclusive rights in some form or another, which puts the competition at a disadvantage.