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Re: Death of the Internet - details at 11

2004-01-13 16:14:44


John C Klensin wrote:

Noel, I'm slightly more optimistic along at least two other dimensions...

...

(2) The "no servers unless you pay business rates", and its close relative, "you don't get to run VPNs, or use your own email address rather than ours" nonsense you and many others are experiencing is sort of an old story. In a competitive market, it is also a pretty simple matter of economics:

    * You don't "want" the server and address capability
    enough to pay for it,  because you consider it
    excessively more expensive than the cheap "client"
    service.  I go ahead and pay for it, both because I have
    a higher perception of need and because it is still lots
    cheaper, and offers better performance most days, than a
    dedicated DS0 from any plausible ISP I've been able to
    find.

That's a specious argument; you declare it nonsense that ISPs charge business rates, but you admit that's what they do, and in fact endorse it by paying those rates.

    * The difference between those "business rates" and
    whatever you are paying are mostly determined by a "what
    they can get away with" mentality -- we know what the
    marginal operational costs are.   If those prices stay
    high, it is either because there is no alternate
    provider, or because there is (illegal) price-fixing
    going on, or because no one sees a business opportunity
by operating a business service at a lower margin.

Or because it will cut into their "business" business, which is more to the point. The telcos are maximizing a pair of profits - business and consumer, not just consumer. The difference in rates is their attempt to create two markets, with the simplest amount of effort on their end.

These arguments could be used to justify any status-quo. Some economics environments evolve because of a shared perception, whether that perception is complicit or not.

Joe