Who pays for all that Internet video winging our way? Answer: we all will, through higher broadband charges, according to the BBC's Mark Thompson. Speaking at the Royal Television Society's International conference today, the BBC Director General acknowledged that working out who pays for this "revolution" is problematic. You …
2 years now
and nothing has changed. The ISPs still are unwilling to accept that they are at fault for using a such a terrible business model and instead choose to whine at others. Nobody forced them to trumpet their 'unlimited' plans and certainly nobody asked them to neglect their infrastructure.
They're just pissy with the likes of the BBC because now they're forced to do something about it all instead of continuing to milk the customers.
I'd hardly say that the BBC is getting a free ride - they pay for their internet connectivity, after all, and it's a pretty hefty sum, getting that data to a place where it interconnects with the other ISP networks.
Of course, after that, yes, it takes up space on the network - just like traffic from every other service.
I don't see a really good argument for charging companies like the BBC or YouTube, but of course it's an attractive proposition to the ISPs, because they get someone to blame, and they can try and dip their fingers in the licence fee pot to prop up their failing business plans.
The real problem, of course, is that for years ISPs have been competing in a race to the bottom, claiming to offer the fastest, most unlimited services, for the lowest price possible, and shedding every bit of cost that they can, in the name of greater shareholder value.
As a result, they have creaking networks that can't serve the needs of some of their users. They should be investing money in those networks, rather than lining the pockets of shareholders for short term benefit.
And yes, perhaps some users will have to pay a premium for a less restricted service. If they complain, the main cause of that is surely not the BBC or anyone else providing IPTV services - it's the fault of the ISPs who pretended they were selling an unlimited resource, with misleading advertising ad obscure 'fair use' limits, when they really weren't doing anything of the sort.
Even without IPTV, the broadband that many people have been sold doesn't match up to the description. Attempting to put the blame at the door of broadcasters is shifting the blame; IPTV is a convenient think to point at, but we'd have reached the same point sooner or later, thanks to the unwillingness of so many companies to take a long term view.
who pays who?
"I'd hardly say that the BBC is getting a free ride - they pay for their internet connectivity, after all, and it's a pretty hefty sum, getting that data to a place where it interconnects with the other ISP networks."
Ok, so BBC pays Level 3. That's bulk transport for data involving some bits of fibre and expensive router or switch ports. Your ISP then probably pays Level 3 for transit, so you can get access to the BBC's data. The economics challenge is content providers generally pay your ISP nothing for delivery, yet your access portion is the most expensive part of the network. Costs aren't shared equally or equitably, so the only person the access ISP can charge to improve service is you.
Thompson is happy with you being charged because then the BBC isn't.
"...content providers generally pay your ISP nothing for delivery"
Which is the point of the article.
The end-customer is paying for that delivery.
The problem is that the ISP is charging rock bottom prices for a very shaky business model based on the lowest denominator of Internet use. As the network develops, this is changing very rapidly and the ISPs have marketed themselves into a place where they move from.
I don't see the problem
If we want to download more we pay more. Sounds pretty simple. It's alright though because I'm on an unlimited plan. What's that you say? ISP's have been actively trying to deceive consumers and now all of their bullshit doesn't make sense?
> The economics challenge is content providers generally pay your ISP nothing for delivery
Doesn't matter. *I've* already paid my ISP for delivering the data of my choosing to my router.
The problem is that the ISPs won't make a profit if they have to supply what they promised for the prices they charged. That might, in the long term, be a good thing - there might be more honesty in how broadband is marketed.
And, if consumers have to pay higher fees to get TV on their confusers, perhaps someone might re-think the viability of using unicast delivery for broadcast content...
Who pays for mcast?
Unicast sucks, but mcasting pushes the problem to the edge again. Who pays for that? The content provider, or you? The content providers won't pay, so you will. The UK infrastructure won't really support mcasting anyway given the way BT (and other xDSL) delivery works. And don't forget the ISP's are also supposed to pay for DPI kit, just in case that content you expect for free isn't.
The problem is what you think you're paying your ISP's for isn't what you're getting. Most of the time you're getting a contended broadband service, because otherwise it'd be far more expensive. Even if you had uncontended broadband, you'd still face potential problems if the content you were trying to access is contended, or load balanced/shared.
Then you get the net neuts, who seem to think all content should be equal, mostly these are content providers, and mostly saying this to avoid being charged. Content isn't equal, and real-time apps like video streaming or voice need higher QoS than non realtime apps like email or file downloads. So lobbyists argue for the worst possible QoS for the wrong reasons.
The ISPs carrying the data to the end-user seem to forget that the BBC and others already have to pay to get that content onto the net. After all, for every meg downloaded by an ISP user, the provider has to upload it.
The costs are already shared between supplier and consumer, but the ISP to the consumer thinks it should get a cut from the supplier too. Sorry, run this past me again... what's the justification for that?
Oh, the ISPs have sold their product too cheaply... I still don't see how that's the fault of the content provider who still have to pay their bandwidth bills.
What's all the fuss about?
I pay a flat rate for my bandwidth allowance. What I pay for, I use. If I blow my cap, I pay more for it. Whether it is delivered fast or slow doesn't really matter that much; 7Mbs is more than adequate for iPlayer. There is still no argument, as far as I can see, for a two tier system, or for anyone to pay more than they're paying already.
The only thing the broadband companies are losing on, is the monthly allowance I'm paying for, and NOT using! That's money for nothing as far as the ISP's are concerned.
My broadband usage over the last year has crept up from about 10Gig a month (for which I was paying for a 25gig allowance) and is now around 20Gig a month.
All this ... and they're trying to take us to super fast broadband. Doesn't make sense with the present model.
Or have I missed something here?
>Or have I missed something here?
Yep - contention ratios at the exchange and network infrastructure which don't allow ISPs to actually provide the level of service people are promised.
Increasing costs of premium packages might even things out in that many people couldn't afford to pay, but doesn't address the underlying issue that many ISPs oversell a limited capacity on the basis that many of their clients don't use what they are paying for.
Immovable Object meet Unstoppable Force
"We see this as a straightforward business dispute, but many net neutrality campaigners think there is a consumer rights and even human rights dimension"
Not sure who this "we" is but it is a bigger issue than simply 'business dispute' between content providers and distributors/carriers; it goes to the heart of society/consumer issues of who pays for what (and to whom) and what collective subsidies are legitimate and reasonable, what rights consumers have or don't.
When iPlayer uptake incurred costs on ISPs someone has to pay for that and the outcome of such a decision on who pays could greatly affect the future and where lead to. Of course consumers are interested in that.
"When iPlayer uptake incurred costs on ISPs someone has to pay for that"
...my question is ... we're already paying for it ... at both upload and download ends. So what am I missing? Or are ISP's not charging enough for the data that we ARE paying for?
No sympathy for ISPs
If streaming video is such an issue for ISPs, why do they all refer to it as something you can do with their unlimited (capped) super-fast (traffic-shaped) broadband services?
Advertising and selling a service you can't actually deliver is illegal, isn't it?
If Royal mail did traffic management
If a postman decided his bag was a little too heavy today and started opening and reading everyones mail to only deliver what he thought was important, holding off everything else, there'd be an outrage.
But apparently its ok for ISPs.
Worse, what if the paper boys / girls did it
Maybe the paper boys / girls should read the papers they are delivering and filter out all the stuff that isn't actually news or useful content then prioritise delivery based on information density. The Daily Arsewipe would be down to the size of a stamp by the time it got to your letterbox, a week later. Of course no Daily Mail would probably increase the sales of Andrex....
royal mail do do traffic management.
It's called first class, second class, special delivery etc. etc. How much you pay is directly related to how quickly you want the item delivered and the relative cost of doing so (you pay more for bigger / heavier things)
That aside I agree with the other posts, the ISPs created this problem for themselves. They will have to move to a different business model and sting either the cosumers or the content providers
That would be more akin to Assured Service
That would be more akin to "assured service",as used in for example for BT vision. In that case, the priority is specifically requested by the fee-paying user. We decide for ourselves "What is important", Royal Mail don't decide it for us.
With traffic management, as implemented by UK ISPs, the networks are deciding for themselves what is important. Maybe I need that torrent full of mission critical updates quickly? Maybe I'm using that video stream for business use? What right does the ISP have to decide what is best for me?
I pay for my end of the link, you pay for your end of the link. It's been that way since before TCP/IP was even a concept. The marketing forces of the world need to get used to the idea.
Not by this post but by the article. Had a chat with my brother last night along similar lines. I live in Germany and ISP costs are just not an issue. Nobody talks about them neither fixed line nor mobile. Fixed line services are nearly all completely unlimited flats and 16 MB/s downloads are standard for city dwellers and faster is not uncommon.
According to my brother, who works in the UK telco industry, everyone is making a loss on data. We couldn't square the circle but German companies did make extensive capital investment in the run up to privatisation of the telephone network in the 90s so there is abundant capacity - there are at least 4 independent glass-fibre loops in my city. I think this is one of the reasons why we have so many data centres here. Driving down costs and increasing availability are considered politically to be essential for ensuring competitiveness which is why the recent TV dividend auction was coupled with requirements to provide broadband to rural areas where DSL isn't an option. France has taken a predictably dirigiste approach with the government requiring France Telecom to build out new exchanges. But even there competition has both driven down costs and improved services.
The UKs privatisation of telephone network in the 80s is yet another example, along with the railways, of how not to do it. BT and C&W made a killing for years because there was neither regulation nor competition. But rather than invest the proceeds in improving infrastructure they passed the profits to "investors" and now everybody suffers. If prices do rise then business will be one of the main casualties.
Sorry, but this short-term approach is, to me, systematic of the British (probably Anglo-Saxon) disease. Of course, being a Brit, I'm just as slapdash as the next!
How about no internet tv?
I'd quite gladly pay for an ISP that provides an internet service that doesn't carry iptv. I'm sick of having a connection that drags virtually to a halt at peak times. If ending net neutrality meant I could get an internet connection that denied Youtube traffic, I'd be more in favour of it.
Time to change ISP
No way in hell ISP's and BBC...
UK bandwidth is very bad compared with many other countries. Therefore iPlayer may hit our shit UK ISP bandwidth, but it wouldn't hardly notice in other countries ISP bandwidth usage figures.
Also technology will continue to improve over time and therefore bandwidth will improve. We cannot and must not be tied to a short sighted greedy business model that taxes us on various types of data bandwidth based on current technology limitations especially because once they bring this in, then no matter how much technology improves after that, they will not want to give up their ability to tax our data in ever more ways whilst also exploiting their ability to also spy on our data in ever more ways, simply to find ever more ways to tax us all! (and that is before you even add in the ever increasing risk of them moving towards Phorm like ways to exploit their ability to spy on us all).
They cannot be allowed to start taxing data.
(Flame icon for fires of hell directed at ISP's and BBC bosses).
Arn't the BBC paying their way...
In terms of providing licence fee money for Fiber roll out to places where it isn't economic to otherwise install?
Customers should demand more for their money.
Sod the ISPs
The ISPs have oversold their networks - they persuaded us to cough up for this unlimited, super-fast, ultra nifty broadband whilst quietly sniggering to themselves as they thought that we would never be able to use all this bandwidth. They therefore sold the same bandwidth to 20, 30, 50, whatever number of other users, at the same time, and they are now finding that we /can/ - and will - use that bandwidth that they don't have, and now they find ways to cheat us of what we have paid for - download caps/bandwidth shaping/protocol capping, you name it.
In any other industry, they'd be guilty of fraud, but our numpty governments get lobbied, the watchdogs pass the buck and we get screwed.
The ISPs need to work out what they can deliver, and sell that.
Not just ISPs playing this game
"In any other industry, they'd be guilty of fraud" -- except, possibly, banking.
The banks lent money they hadn't got, to people who couldn't afford to pay it back, to buy houses that they thought would have appreciated sufficiently in value by the time repossession became inevitable to cover all the eventual costs and still leave a tidy bonus.
Maybe the ISPs are hoping for a government bail-out?
If an airline sells more seats than it has available, then tells someone they can't get on the flight, they must wait for the next one, there would be uproar.
If I get (as I do) a 24Mbit/s unlimited internet connection, I expect to be able to use it whenever I want. If my use involves me saturating that constantly for a year, that should be my prerogative.
If the connection is NOT unlimited, it should not be sold as such. If a fair use policy is in effect, with a bandwidth cap, the product is NOT unlimited, and should not be sold as such.
Luckily I am with Be and I have, in the past, used my 24Mbit/s download and 2.5MBit/s (I think) upload constantly for weeks on end. There is an FUP, I have never had it affect me, nor has anyone else. There is no 'cap' (I think the wording is to do with affecting other users, not a specific amount).
The longest suicide note in history
EddieD: I think you´ll find if you look at the very very small print in the contracts, thats its a 50:1 contention ratio on consumer ADSL circuits. So its no suprise that the Networks started to creak when streaming services came along.
This snake oil aproach of selling the same bandwidth to 50 different people has been going on since the days of dial ups, (or in those days fit one modem for every xx customers).
ISP´s should start to sell on the quality of the service now and not on the lowest price. I am more than happy to pay extra for smoothly streamed video´s and quick torrent connections. But my granny who only read her emails only wants a reliable connection at a cheap price. One size does not fit all and the ISP´s have to accept that or go bust. The price of wholesale bandwidth can not fall much lower, most people who want a ADSL line have one, so the only way to churn customers now is lower your price (financial suicide) or be better than the competion.
But Airlines DO that...
I've regularly been at Heathrow and been asked if I'll move to the next flight for either cash or vouchers...
Free ride? Why the BBC will not be pulling teeth
As increasing numbers of people abandon the tithe that has traditionally been extracted by the now Bolshevik Broadcasting Corporation, so its iPlayer is not a concession to a free market (least of all - in ideas), but an elephant trap that is being carefully laid now to be sprung in some future. ISP costs will rise; prices might, depending - but the BBC will be skimming. How better to secure a revenue stream than to hide it behind someone else's price rises and have them take the heat? In future IMO if you and I want the broadband banana we will have to pay for the BBC gorilla whether we like it or not.
Less with the licence-fee bashing, please
Other broadcasters sell audiences to advertisers. The BBC sell programmes to audiences.
40 pence a day is, frankly, a tiny price to pay for this difference; which is precisely what allows the BBC to make some of the world's finest drama, documentaries and cutting-edge comedy without kowtowing to the interests of advertisers or government.
Still, I would like to know why a viewing card reader was not mandated for all digital receivers from the day that it was decided that the future would be digital; then the BBC programmes could simply be scrambled, thus obviating the need for poison-pen letters and intimidation on the part of the licence fee collectors (who are not employed directly by the BBC).
"40 pence a day is, frankly, a tiny price to pay"
Which means you value it very highly, and so should be paying more. I am guessing you can probably afford it.
Many people (especially on lower income) use very few BBC services, and so should be paying for what they use. They will be paying less. The compulsory flat-rate tax is no longer a sensible or fair way of raising revenue - it isn't even fair to the BBC.
A subscription model for the BBC is the way forward. A voluntary one, of course
Make BBC and Google pay?
What utter crap!! Why should BBC and Google pay because users are consuming their product? Can I get Southern water to pay because of all that water they shove to my house down pipes? What about the electricity company?
The correct person to pay is the one who consumes it.
As for shaping traffic, I think that should be BANNED. In a world where the ISP cannot deliver the bandwidth that everyone wants, it should be shared out (per users). It certainly isn't fair that someone gets all they can eat of iTube or YouBBC while I cannot download the latest SUSE release because my packets look different, even though I am paying for the same service!!
BT Whoresale dont help
BT wholesale carry a share of the blame, especially after last years 20 odd % hike in IPSC bandwidth costs. I guess when you have a virtual monopoly in some areas you can take the P*** virtually all of the time.
I guess someone has to pay for the FTTC and 21cn roll-outs.. shame its those who face the longest wait for the "superfast" services IPTV is going to kill things on our exchange
Whilst I understand why everyone is UK focused, how would this make any difference to either the Beeb or UK based ISP's to foreign based clients. I know there are many who use not only the Beeb's streaming service but others too,(Hulu,Sky etal via a proxy) whilst living abroad, theres a double or triple whammy there, not only UK ISP but the foreign residents ISP as well. So I'd gladly pay as the S.koreans do, less than $20 month for 100Mbit line. How are the UK ISP's going to justify passing a charge onto UK customers, as they will do we all know that, in excess of $20 for residents abroad. The only option they will have, is to take the highest rated country and apply that charge, so everyone will end up paying $50 a month for some pensioner living in Spain watching repeats of Eastenders using whatever bandwith is left out of my less than 1mbit line on an unlimited upto 8Mbit line package for which the fee is already in excess of $20. Is that right?
Q E bloody D
So basically ISPs are whining because they realise they don't have the bandwidth to offer customers.
You know, you need to invest in the system as well as the shareholders.
And as for the subject line? Video data is getting smaller and smaller and network links are getting faster and faster. This means, back way back when when ISDN was around and the world used MPEG2, it wasn't really viable to download video "for fun". Now we have MPEG4 and many-megabit links. My hardware isn't cutting edge, but that video of the guy and the huge tower posted on El Reg the other day arrived faster than its playback time, meaning that streaming video is now viable for everybody. Get with the times and stop complaining!
We should pay more in the future?
We aren't getting what we've been sold now...
Not often I look at comments (and the articles) on the reg and think to myself "wtf"
There is some serious confusion here about what we are talking about and they are all really separate arguments / discussion.
Two (or more tier networks) - deals between ISP and content providers / search engines / a another to provide faster service to them specifically - this is the original net neutrality argument, and rightly caused some consternation.
Traffic Engineering and management - wow...just wow - the fail here is epic - this has been ongoing for years and will continue to go on - the idea the human rights etc comes in to play is foolish in the extreme, in what is in essence boils down to a way of controlling traffic between delay and non delay sensitive types (and all the grey between).
Then there is quality assured management - where you pay a premium for guaranteed services (within an sane definition of guarantee) , again nothing shocking about this and in fact many people already do this perhaps without realising...
Finally all this has blurred into people who wish to pay for a dumb pipe that isn't actually at all dumb (only everyone thinks so because of the way clown's like BT and the ISP's, mobile or otherwise have marketed it) and in fact its the services you run that differentiate your usage, not the pipe. You want to watch real time streaming - well that's different from sending email or browsing HTTP...
This all boils down to away of pricing a system that allows people to get what they want, for what they want to pay - and the ideas espoused by some above where they seem to forget that without the bit in the middle there isn't actually a service, mystifies me.
Well, in the end, the consumer pays.
If content providers have to pay extra for end-user delivery, they add it to the bill and it comes out of the public's pockets.
If you doubt this, consider mail order. The suppliers pay the cost of delivery, but there's that little entry "P&P" on your bill -- they pass the cost on to you.
But unlike Sky, the Beeb can't just arbitrarily up it's income to compensate for increased outgoings. In the old days if I wanted info from the BBC I was invited to send them a stamped-addressed-envelope, which in the old days we abbreviated to SAE. That way they were able to send me their content without receiving money (not allowed) and without incurring unacceptable costs.
Let's call my ISP fees my new "SAE".
Simple issue, complex problem...
There are a number of issues here which compound into a very complex problem:
The BBC, ITV, SeeSaw et al are content providers, that is they create the products for consumption by the consumer.
Consumers, pay for the content through one medium or another whether it be the licence fee or having to watch a couple of advertisements.
In the middle are the suppliers. This is the ISPs. The problem they have is that they set them selves up as the deliverers of content just like the tranport firms who deliver goods to shops. The issue they are now finding is that they have insufficient bandwidth (or to keep the analogy, vans or wagons) to deliver the content. They therefore need to buy new vans and money is scarce so like any supplier they can either increase the charges for delivery but that will potentially put consumers and or the content providers off using them and thus they lose business or they look at other ways to increase the value of what they do.
If you look at the big transport companies they go way begond providing just a van to stick things on. The create warehouses to store goods for their customers, they advertise on their assets, etc. ISPs needs to learn from this. Content providers need systems to improve delivery, the iPlayer is rubbish when accessed at peak times as programmes constantly stop while they buffer due to the volume of users, what is needed is a good warehouse a bit closer to users in different parts of the country to store the content and make delivery quicker. There is nothing to stop ISPs providing such a service from adding in some additional advertising of their own into the stream (targetted if the users allow). By doing this they improve their revenue streams without actually increasing base charges.
The problem is that ISPs are telecom providers in the main and they all have to rely on BT to provide the wholesale bandwidth except in a few urban areas. The result is that they are not able to put in place the warehouses and OFCOM will not allow BT the monopoly of building them. So we end up where we are to day.
If only people had listened to Lord Young in the early 90s when he was at C&W, the killer app for networks was always gong to be video and the merging of telecoms networks with entertainment was always going to give the telecoms players a chance to pull revenue through content unfortunately the delays in its arrival meant everyone went to commodity pricing for something that will never be a true commodity.
Isn't that the point of Canvas?
But isn't that the point of Canvas - that ISPs and content providers get closer to each other and understand what's needed to deliver the "future"?
Crap logic from ISPs
Rogers blocks VPN on their G3 internet sticks. You have to pay extra if you want to use VPN. The extra charge gives you no more data per month, just unblocks ports.
Why pay more for one type of data? It seems that they feel VPN data is more valuable then other data so you should pay more.
What did they do to warrant extra pay? Zip. They didn't do anything to make this data worth more to me.
They keep saying that the data is valuable so they should get a cut, after all the data is using their network.
iPhone Tethering charges
With the iPhone, its not even the traffic thats different, its just, shock horror, you want to look at it on a bigger screen! Pay up please.
Pretty much every thing in relation to computers follows Moore's law, yet for some reason the ISP's decided that Bandwidth use would not when they started overselling their capacity...
I have no sympathy for them.
It's not bandwidth, it's QOS
Whilst the bandwidth for delivering individual video streams such as iPlayer may present a challenge, they can be addressed by techniques such as caching at local exchanges. The real challenges come with VoIP or desktop video teleconferencing, where strategies such as caching and pre-buffering are not an option. For these, it is Quality of Service that we will end up paying for - service levels for latency, jitter etc., not solely bandwidth. And since these are end-to-end parameters, it is not unreasonable that users with higher QoS demands should have the "opportunity" to pay for higher service levels.
There seems to be a school of thought that, when approaching a motorway lane closure, EVERYONE can move into the outside lane and overtake everone else. That just does not compute.
BT Vision anyone?
Every one I know with BT Vision also has terrible landline noise to the telephone.
Here in France, Orange bundle web TV access with a standard broadband package. No idea how the economics work out but they actively promote the fact that if you get their broadband you can access more than 30 realtime TV channels via the net for no extra cost.
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