Begin forwarded message:
From: Fritz Mills <[EMAIL PROTECTED]>
Date: January 7, 2006 5:58:03 PM EST
To: [EMAIL PROTECTED]
Subject: Re: [IP] more on : Telco's Arrogant Stand on Content
I don't have any problem with the notion of paying for Quality of
Service, but I think the argument, as it's been presented so far, is
completely confused. First, the statement quoted below from Budde
makes no sense. Google, Vonage, and others do not use the internet
for free. Like everyone else, they pay for access and they pay for
the bandwidth they use. They may not pay SBC, but that is beside the
point. I, on the other hand, am a customer of SBC, and I pay them for
access to the internet, and I pay for a certain amount of bandwidth
(throughput). I may or may not choose to use my access to connect to
Google or to use Vonage's services, but the point is, that *I* am
their customer, not Google or Vonage, and if they want to charge me
more to guarantee a certain level of quality of service for some or
all of my internet access needs, that's something we can negotiate,
but that has nothing to do with Google. Conversely, even if I do
choose to use my access to visit Google, It is because I have paid
SBC for the bandwidth to do so. Google has paid their provider for
the bandwidth to accept my visit, but they should have no obligation
to pay SBC as well.
To put it in terms that perhaps the telcos can better understand: If
I pick up my telephone and make a call to Google, I must pay my telco
for my phone line and telephone service, and Google must pay their
telco to provide the telephone service that allows them to answer my
call, but there is no obligation on the part of Google to pay my
telco, too. Nor is it true in that situation that Google has "used
[my telco's] pipes for free."
Begin forwarded message:
From: Dewayne Hendricks <[EMAIL PROTECTED]>
Date: January 2, 2006 5:25:14 PM EST
To: Dewayne-Net Technology List <[EMAIL PROTECTED]>
Subject: [Dewayne-Net] re: Telco's Arrogant Stand on Content
Reply-To: [EMAIL PROTECTED]
[Note: This comment comes from reader Andrew Odlyzko. DLH]
From: [EMAIL PROTECTED] (Andrew Odlyzko)
Date: January 2, 2006 8:34:30 AM PST
To: [EMAIL PROTECTED]
Subject: Re: [Dewayne-Net] Telco's Arrogant Stand on Content
Dewayne,
There is plenty of arrogance on both the telco and content provider
sides. But statements such as this one from Budde, and Whitacker's
"What [Google, Vonage, and others] would like to do is to use my
pipes free. But I ain't going to let them do that."
make clear is that the key issue behind much of the posturing about
open access and deregulation is the division of revenues from content
sales between the content owners and the service providers.
I don't know what Budde is referring to when he talks of telcos
getting under 50 percent of revenues from content. In general,
service provider takes are far higher. If you look at cable
companies,
they spend around 25 percent of their revenues on content, and get
to keep 75 percent or so for the maintenance of the networks,
profits, ...
Satellite radio pays someplace between 5 and 10 percent of its
revenues
for the music they play. And NTT DoCoMo's i-mode pays only about
15 percent of its revenues for content. (I don't know what the
revenue
split is on cellphone music ringtone downloads.) So it is natural
that the content industry is salivating at the prospect of getting
more competition in delivery, and boosting their takes. Getting
something like 50 percent would do wonders for their finances.
But what both the content industry and the telcos forget is that
there simply is not enough money in content to pay for all the
telecommunications networks. Connectivity, not content, is where
the real money is, as has been clear for a long time,
<http://firstmonday.org/issues/issue6_2/odlyzko/>
So yes, the content providers and Internet companies like Google and
Yahoo! can build backbones, but they can't afford to provide
universal
local connectivity.
Happy New Year,
Andrew
P.S. There are lots of other comments one could make about this
piece
by Budde. For example, his rosy prediction for tele-presence
flies in
the face of numerous failures in video telephony. But that is
another
subject.
Weblog at: <http://weblog.warpspeed.com>
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