From: jim bell <jimbell@pacifier.com>
Date: Sat, 17 Aug 1996 11:48:14 +0800
To: jya@pipeline.com (John Young)
Subject: Re: FCC_ups
Message-ID: <199608170022.RAA29008@mail.pacifier.com>
MIME-Version: 1.0
Content-Type: text/plain


At 02:31 AM 8/17/96 +0000, Vipul Ved Prakash wrote:
>>    8-10-96. WaPo: 
>>    "Phone Service Via the Internet May Slash Rates." 

[deleted]

>This kind of report is often confusing and more often misleading.
>Most of the internet still runs on "the infrastructure provided by 
>the giants of the telecommunications industry, who according to the report 
>would cease to exist after some time". 
>
>Bigbells and Babybells provide cheap [flat rate local calls] and 
>expensive long-distance calls. They make most of their money on the
>later. This money goes into development and maintainance of their
>infrastructure. Once they loose these profits 1. They won't be able
>to provide cheap local-calls and/or 2. They would go bankrupt and shut the
>entire network which is used by many to connect to the internet.
>
>This is complex problem and the only solution I see to it is a
>different pricing policy. [Prolly a differential pricing system might fit
>the scenario but I don't have much idea about that] 
>
>First flat rates would have to go out.
>If Alice uses her phone for 5 hrs in month and pay _x_ dollars and Bob uses
>his for 100 hrs and pays _x_ dollars, then Alice is subsidising Bob, which
>is not really ethical. Everyone should pay for the amount of bandwith 
>one is using.  

I'm afraid you're promoting what I consider a rather old (and, now, odd) way 
to look at it.  Unlike old mechanical telephone switches, the new hardware 
does not "wear out" and thus a person who uses it more doesn't cost the 
phoneco any more bucks.  If that's the case, I don't see the logic in 
charging a person more for greater use.  

The only remaining argument for charging for use is that if everybody were 
to start using the telephone 3 hours per day, it is possible the switches 
would have to be upgraded to allow more simultaneous connects.  However, 
this is unlikely to happen, and as I understand it electronic switches have 
plenty of capacity for current needs and substantially more.

There's a good reason that Internet-connect traffic won't substantially 
impact telephone network limits:  My impression from my local ISP is that 
peak times for him are between 9pm and 11 pm.  This is a time which 
relatively small numbers of voice calls are made, certainly compared with 
the peak times during the day for business calling.  Because telephone 
networks are designed to meet peak usage needs, there is plenty of unused 
capacity at other times.  This is connect capacity that would otherwise be 
"wasted."

In other words, telephone switch capacity is starting to be more efficiently 
used, looked at on a 24-hour basis.  This costs the phoneco not a penny 
more, so they have no reason to charge more for it.


Jim Bell
jimbell@pacifier.com