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Good point about U > T. It also happens in Gym business where they oversell their gym capacity betting that 80% of their customers will be too lazy to come exer

Good point about U > T. It also happens in Gym business where they oversell their gym capacity betting that 80% of their customers will be too lazy to come exercise everyday. Now imagine if I sell a motivation pill that makes you go to gym everyday. It would be absurd if Gym companies send me a cease and desist letter because i am overburdening their facilities because everyone who takes my pill wants to use their gyms everyday.

saganus 12y ago
Actually, now that I think of it, we could probably name a lot of other services that rely on this business model and do a thought experiment like the gym one. An airline for example; now everyone actually caches their flight because Google's self-driving cars always make it on time, and then they demand that Google stops bringing passengers on time? Or a buffet restaurant, since now everyone goes to the gym, they can actually eat a lot more, thus restaurants complain about, either the gym or the pill maker? I don't know, it would be a strange world to live in if this happened in other industries. Maybe prices would rise too much?
aleem 12y ago
Playing the devil's advocate: what if the higher contention ratios lead to 50% reduction in gym membership fee? All other gyms follow suit and consumers and gyms both benefit from the realization that not all members will be in the gym at the same time. Marketing departments start vying for consumers who they know are unlikely to attend everyday and lure them with annual sign up discounts. Fast forward 3 years later, you come out with your pill and throw a wrench in the works. Now gyms realize they have to go back to the old pricing model because the economics have changed. Consumers will no doubt become upset at the prospec of having to pay more. Some gyms take a wait and see approach to see what other gyms will do. Your pill started it but really, it's not your fault or your problem. What should the gyms do?
- 31reasons 12y ago
  >>What should the gyms do? Be Honest. They can invent a new business model based on transparency. Imagine if price is not fixed but you are charged per use based on the traffic at the moment. It could be similar to what Uber does, price based on demand. In terms of ISPs, I think there should be a micro transaction exchange where I can buy X minutes of data transfer. If Verizon is clogged I switch my router to connect with ATT etc. All networks should create a single broker device thats given to each consumer.

saganus 12y ago

Actually, now that I think of it, we could probably name a lot of other services that rely on this business model and do a thought experiment like the gym one. An airline for example; now everyone actually caches their flight because Google's self-driving cars always make it on time, and then they demand that Google stops bringing passengers on time? Or a buffet restaurant, since now everyone goes to the gym, they can actually eat a lot more, thus restaurants complain about, either the gym or the pill maker? I don't know, it would be a strange world to live in if this happened in other industries. Maybe prices would rise too much?

aleem 12y ago

Playing the devil's advocate: what if the higher contention ratios lead to 50% reduction in gym membership fee? All other gyms follow suit and consumers and gyms both benefit from the realization that not all members will be in the gym at the same time. Marketing departments start vying for consumers who they know are unlikely to attend everyday and lure them with annual sign up discounts. Fast forward 3 years later, you come out with your pill and throw a wrench in the works. Now gyms realize they have to go back to the old pricing model because the economics have changed. Consumers will no doubt become upset at the prospec of having to pay more. Some gyms take a wait and see approach to see what other gyms will do. Your pill started it but really, it's not your fault or your problem. What should the gyms do?

31reasons 12y ago
>>What should the gyms do? Be Honest. They can invent a new business model based on transparency. Imagine if price is not fixed but you are charged per use based on the traffic at the moment. It could be similar to what Uber does, price based on demand. In terms of ISPs, I think there should be a micro transaction exchange where I can buy X minutes of data transfer. If Verizon is clogged I switch my router to connect with ATT etc. All networks should create a single broker device thats given to each consumer.