No, and we have two telephone companies currently competing for the tolls
and long distance communications market. It is possible, and I know of a
few people who used to do this, to set up your own links to the outside
world in competition to the main link we use. Everybody has stopped
doing that because it simply isn't cost effective.
The savings represented by the scale of economy that the
international link enjoys simply cannot be matched by a competitor. The
market size of network users here in NZ makes competition tough to
impossible. Remember we are a population of around 3.5 million people
for the *country*. Out of that probably only 0.5% of the population uses
the Internet. That gives a rough total market size of around 17,500 people
you are trying to sell to. (And this estimate is probably large.)
> I'd like to know more about this. Unless someobody has locally repealed the
> laws of economics, there are some kind of unusual technological or structural
> circumstances here that are distorting the market. I'd like to know what they
> are.
Actrix Information Exchange, known locally as Actrix, offers a flat
connection fee with IP traffic charged at varying rates on top of that.
Fees work out at something like this :- (all prices in NZ dollars.)
$80/annum for a UUCP feed.
$80/annum for an online BBS account that has IP access.
$140/annum for a unix shell account that has IP access.
$240/annum for a SLIP/PPP account.
IP traffic gets charged at $7.50/Mb transfered and email at something
like close to $50/Mb. (Don't ask me why it is more than the raw IP
charge, I haven't figured that one out myself.) All accounts get the right
to read/post news at no extra cost.
Actrix mooted an idea to do away with the flat rate for the year and
charge on a time based useage of the system, with IP traffic costs
remaining as they are. UUCP users didn't like it because the figures
given ended up costing more for a reasonable news feed than the flat
rate. And online users postively disliked the idea - they preferred
being able to take as long as they liked online browsing news and
reading email etc...
> No, that's why I specified *local* phone service.
Yes but I am talking generally. I realise you were restricting your
scope to local calls. But your whole argument, that from an economic
viewpoint only flat rate non use/volume charged schemes are viable, is
belied by the fact that the tolls market is still, and seems likely to be
for a while yet, charged in precisely this manner. Even in the 'free'
market of the US.
Certainly what happens in NZ is that we have flat rate hire for making
local calls and this is heavily subsidised by the toll charge side of
business. (Or at least that is what my sources of information say is
occuring.)
> On the face of it, you make a strong case. I almost believed your implied
> argument that the non-viability of charge-by-byte is contingent on a) and b).
> Then it occurred to me that this theory fails to retrodict -- it doesn't
> explain why charge-by-byte wasn't viable in the U.S. back when the U.S.'s
> Internet infrastructure was comparable to NZ's.
>
> Can we develop an explanation for this?
My apologies I thought I had, I shall try and be a bit clearer. My
point is that until you have a sufficiently large user base and a well
established network the time based flat fee charging schemes do not work
well. The US never had to go through the pangs of early networking under
a cost recovery basis. The early networks were funded by the government
and largely established, with an already well built up user base, before
network providers stepped in on the scene and started offering
commercial services.
Even now the US market is skewed by the presence of government
funding. The primary backbone links are, as far as I am aware, funded
and paid for on a non-profit making basis. In New Zealand we don't have
that luxury. Our government has no defence department projects running
that are establishing a high speed network across the country - even
though it would be, in my opinion, a wise thing for the NZ government to
do.
The net result is that US network service providers tend to get
charged fixed costs themselves, the costs of providing the physical
connection to reach the nearest network 'hub' to link into, and this
has given the ISPs the ability to easily budget and ration out the costs
to the end user.
Essentially the reason the US never developed a style of networking
charging similar to what we in NZ have is simply because the US has
never been in the same position as NZ.
> Not rhetoric, reality. Here in the U.S. we have the free-est telecomms market
> in the world. As a direct result, we have the lowest cost-to-consumers. Go
> thou and do likewise.
Bad example. I call the US every so often to keep in touch with
friends there. In comparing prices I have found that it is cheaper for
me, in my not-quite-so-free market, to call the US than it is for the US
to call me.
Not to mention to be exceedingly literal for a moment *why* do I
*have* to love free markets? For all you know I could quite easily
suscribe to other brands of economic practice that I feel are eminently
more suitable than the free market approach. That is why I call the
point as being irksome rhetoric.
This is has now diverged well away from FAQ related matters. I do
feel that the point needs to be made to those on the FAQ list that the
US style of networking is not the model alot of other countries use.
Accordingly suggestions to 'WWW-ise' all FAQs, and other like
suggestions, must be tempered by the effect that will have on the rest
of the world outside the US.
Or we will get grumpy. :)
Philip
-- Philip R. Banks Syntax: mail < banks_p@kosmos.wcc.govt.nz > @@@@@/| Sig Theatre presents :- Star Trek III 'The Search for Spock' @@@@/#| In the middle of the snowstorm three figures materialise around a @@@/##| huddled figure, in a swirl of glowing particles. One bends down, "My @@/---| God Jim! We have found him!" @/ |
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