[12242] in Commercialization & Privatization of the Internet
Re: Future Internet Pricing; incentive to conserve?
daemon@ATHENA.MIT.EDU (Roger Bohn)
Wed May 11 03:07:04 1994
Date: Tue, 10 May 1994 23:00:52 -0700
To: telecomreg@relay.adp.wisc.edu
From: Rbohn@ucsd.edu (Roger Bohn)
Cc: sharoneg@clove.lcs.mit.edu, hbraun@ucsd.edu, kc@cs.ucsd.edu,
com-priv@psi.com
At 9:53 PM 5/10/94 -0500, sharoneg@clove.lcs.mit.edu wrote:
>does anyone else besides me see implications for this "usage-based
>pricing" discussion in the lawyers who "carpet-bombed" the internet
>recently, advertising their ability to help immigrants get green cards
>from a lottery?
Absolutely.
No incentive to conserve bandwidth (e.g. no price nor a quota) ===> people
will treat bandwidth as free, as the C&S crowd did.
Rulers and committees have tried to repeal the laws of supply and demand
for millenia; so far without more than transitory success. A failure to
implement some form of usage based pricing will inevitably lead to
"pollution" of the "ether".
I sincerely expect to see undergraduates running Cu-See Me from their dorm
rooms across the country, for multi-day periods. (Remember the old urban
legend about keeping a phone line open to a girlfriend in Alaska for days
on end, then telling the phone company their computer must be buggy because
no one could be that stupid?) The days of "too cheap to meter" are about
to be cut off by the advent of interactive multimedia.
The nice thing about _smart_ incentive schemes is that all the newsgroups
and budget constrained users can still send stuff out for free. Hal Varian
and Jeff Mackie-Mason have written to this group about one such proposal;
Hans Werner-Braun, Steve Wolff, Kim Claffy and I have proposed another.
(Ours is based on quotas rather than prices, but it could be implemented in
a way which is quite similar.) These systems get the best of both worlds:
incentives to conserve on scarce bandwidth, but allowing effectively free
services to continue as well. (The catch is that those who are willing to
pay will get faster service than those who want it free. But everyone is
provably better off.)
Roger Bohn
School of International Relations and Pacific Studies
University of California San Diego
rbohn@ucsd.edu
