We seem to have gotten off on the wrong foot -- perhaps I've been unclear :

> There is an epistemological problem here about what "full price" means, which is subjective... You seem to want there to be some "other" type of price that is the "real price".

I think I made this pretty clear, but I'll re-state it to try to clarify what I mean : "Real price" is not an 'epistemological problem', it's simply the cost of dedicated internet service. That might come from AT&T or Comcast, but it might also come from US Signal, or Level 3, or Cogent, or Zayo, or any number of other providers.

When you pay for a typical home or 'small business' connection, you are not buying dedicated internet. You are buying shared internet. You've bought a small fraction of a connection. That's why, under times of heavy load, the connection slows down.

"Real price" is the cost of a connection that "never" slows down, because it is literally dedicated to you and only you.

For example, when you buy a connection from Comcast / Time Warner / Cox / Charter, they might advertise it as "up to 50mbps". Your not buying a solid 50mbps, your buying a tiny portion of that 50mbps line (a portion you share with your neighbors).

The "real price" of a 50mbps connection is much higher, because it's cost can't be spread out / shared among lots of people (since that connection is dedicated to you alone). I'm not inventing this price, it's a figure you get from an upstream provider in your area.

> Perhaps you are saying that ISPs make more money from business customers than from residential customers. Perhaps this is true, but the fact that it is convenient for the business model of an ISP to charge some customers more does not mean that other customers are not paying "full price".

Your twisting my words. I said business typically pay for dedicated internet ("full price"), where as residential users pay for shared internet ("partial price", or a small portion of the full price of that service.

Lots of people will complain they paid for "50x10". But they didn't, they paid for a small shared portion of that 50x10. They paid "partial price" for partial service, but feel entitled to full service. (They bought a shared connection, but feel entitled to a full, dedicated connection).

> You seem to be suggesting that the primary factor in network costs is use, but all the sources I read (for example this one)[1] suggest that connecting the last mile is expensive, and routing an arbitrary volume of packets over that pre-installed copper is extremely cheap.

Your have a few facts correct here, but have come to the wrong conclusion.

You are correct that 'routing arbitrary packets is cheap'. However, there are lots and lots of other costs your ignoring. For instance, installing copper is not cheap. Hooking up that copper to the internet at large, is not cheap. (You have to have internet access, to sell it.) Maintaining copper is not cheap. Simply letting copper sit in the ground, without touching it in any way, is not cheap. (One quick example: Copper is not a fixed expense in the US, you typically have to pay each month for the 'right of way' to even let copper sit in the ground or in the air, untouched. Every single foot is billed. In my city, that cost is 33cents per foot, so to run a cable from two buildings two miles apart, costs $290 per month, just for the right-of-way for that cable to exist. That doesn't include the cost to install or maintain it, or connect it to the internet, or pay anyone to install it, or pay anyone to maintain the network behind it, or any other expenses -- simply for permission for that cable to exist at all runs multiple-hundred-dollars each month)

You are correct that 'last mile is expensive'. But you have it backwards -- high-margin business connections subsidize cheap residential ones. Businesses pay for those two to three mile hops, and home users get cheaper access by virtue of being 'on-the-way' to a business. This is why many businesses have fiber to their location even while most homes don't.

> There is an epistemological assumption in here that "the system" is fair or impartial or acknowledged in general by society or based on objective costs, or something.

Nope. No assumptions. Every home user signs an agreement, that clearly states what is "fair". They include terms like "no hosting a data center" or "don't use more than x00GB per month bandwidth". I'm not inventing or assuming a definition of "fair", it's spelled out in detail when you subscribe for service.

If you don't like a given ISP's definition of "fair", you buy something else with less restrictions that you feel is "fair". That usually ends up being dedicated internet service, since you can typically do (almost) anything you want with it.

Some ISP's have ridiculious definitions of what's "fair" that break traditionally expected norms. ISP's with ridiculous restrictions should totally eliminate those (e.g. ISP's should allow friends to play Minecraft on their connection).

But the simply act of having some restrictions is not, in and of itself, ridiculous. Since the product is by-nature shared, you need some level of protection against bad neighbors, or you end up with a 'tragedy of the commons' problem.

> I did a cost comparison, and consumer vs business class in my area for my ISP is merely double.

Your comparison is not even remotely fair. You did a cost comparison for "consumer shared" and "business class shared". The marginal cost between those is very little (they're both the same shared connection, business class just gets higher priority).

A real comparison would be you comparing your home ISP, with a Business Metro Ethernet line, or a Business Dedicated Fiber line. It will probably take you a little while to do a proper comparison, as at these prices, you almost always have to talk to a sales person first (pricing isn't public). In my area, a dedicated 20x20 runs $400 to $800 a month, assuming your already on-net (most businesses aren't, they pay even more).

If I can add as an aside, both yours and Drew's arguments are interesting reads. Both of you are arguing well.

To add to the data, the dedicated fiber line at our business goes for ~$700 and is 500 up 500 down (in Canada, BC).

that scales slightly better than the connections we get residentially, take from that what you will.

In my opinion, if the reality is that me and my neighbours are all sharing a single 50x10, then having an third party non regulatory agency dictate the use of a utility to me without disclosing any of the factors they use to reach that decision, feels like an unfair situation. I'm also surprised to learn that so little bandwidth is present. I wonder about that.

> "Real price" is the cost of a connection that "never" slows down, because it is literally dedicated to you and only you.

So I have come to the conclusion that in part we are talking past each other. You are saying “Consider the set of people such that they need more bandwidth than is available in the pre-existing copper/fiber cabeling to the premises. In that case they need new cable/fiber. This is expensive. The fiber that they will receive is theirs alone (since, for starters, nobody else seems to need it).” Yes, that is all true.

However you are conflating this with the alternative “Anyone who does not do this shares a line with other persons and therefore can have no reasonable expectations about their level of service.” Which is not true. It is, in fact, the responsibility of the ISP to make a reasonable effort to control oversubscription. Some ISPs do not do this, of course, but the consumer is not wrong for having the expectation.

Here in Austin, we have 8x4 DOCSIS3 to the building. That’s about 340MBit/s down. If you divide that by the ten units in this building, that’s 34Mbit of (dedicated) bandwidth to each unit. Meanwhile my advertised speed is 35Mbit. I’m never going to notice if everybody saturates their connections and I lose 3% of my bandwidth. So.

There are higher packages, and so I dunno, maybe there is this class of people that is just super annoyed that they are suddenly surfing at “only” 34Mbit during peak hours. But as a huge computer nerd I am not in that set, and I suspect the number of people who are seriously annoyed by oversubscription in Austin is a rounding error.

> However, there are lots and lots of other costs your ignoring. For instance, installing copper is not cheap.

I think we are in agreement here. Essentially I am saying that the cost difference between routing 1 packet and routing 1,000,000 packets is negligible, because the cost to route 1 packet involves installing the copper/fiber (and upkeep apparently).

What you are saying is “Well, what if you need hundreds of megabits of speed at your apartment?” And yeah, that is a problem, because in that case we need to run new cable/fiber. But this is not really a “shared line” problem. There is no service here that advertises a 300mbit shared line. It doesn’t exist.

> But you have it backwards -- high-margin business connections subsidize cheap residential ones. Businesses pay for those two to three mile hops, and home users get cheaper access by virtue of being 'on-the-way' to a business.

This seems absurd to me, to the point of being unbelievable. It may be that business class fiber is installed first, because no ordinary resident will lease their own fiber. However “installed first” and “subsidizes the cost of other subscribers” are two totally orthogonal things.

If you consider a fully-connected residential network, it spans a larger area, and has a lot more cable installed (and probably is a lot more expensive to build), than a fully-connected business network. Thus, connecting an arbitrary business to a fully-connected residential network will always be cheaper than connecting an arbitrary residence to a fully-connected business network. This doesn’t have anything to do with “first” or “second”, it has to do with the size and linear feet of cable and square mileage of coverage of one type of network when measured against the other.

> Every home user signs an agreement, that clearly states what is "fair". I'm not inventing or assuming a definition of "fair", it's spelled out in detail when you subscribe for service.

This is literally the COMPLETE relevant part of my residential-class internet connection terms of service from a major ISP:

> The Services are for your reasonable, personal non-commercial use only. You may not provide the Services to any person who is not a member or guest in your household, or to persons outside your premises, whether for a fee or otherwise. You will take reasonable precautions to prevent others from gaining unauthorized access to the Services.

Can I run an HTTP server? I have no idea. Can I use 2TB a month? No clue. There is absolutely nothing "clear" about what I can or cannot do with my internet connection, and if you think being "clear" and "fair" is standard business practice for ISPs in the United States you need a real reality check.

> “Consider the set of people such that they need more bandwidth than is available in the pre-existing copper/fiber cabeling to the premises."

Close. I'm saying 'Considering the set of people that need more bandwidth than is available regardless of the pre-existing infrastructure.

It's a subtle difference, but it matters. Your next point is a good example of why :

> Here in Austin, we have 8x4 DOCSIS3 to the building. That’s about 340MBit/s down.

Pause here, this is a faulty assumption. Yes, your buildings line is capable of 340Mbit/s down. But your line is (probably) never maxed out like that.

For a provider to offer you 340Mb dedicated to your building, they'd have to pay for a dedicated 340mb to your building. I don't know the prices in Austin, but in Urban Michigan, just getting a 200x200mb backhaul connection costs roughly about $2,000 to $2,600/month.

If there are ten units in your building, to let your building share 200x200 would mean your ISP would have to have a backhaul cost of $200 to $260 per unit, just on backhaul alone!

(That doesn't include the cost to have copper in the building, or the cost for the ISP to get that backhaul from their data center to your buildings demark, or the cost to have your traffic routed / shaped nicely, or the cost for a telephone operator to offer you support, ect)

I presume your buildings units are residential; if that's true, there's no way your paying $300 or more per unit for home internet, so your ISP likely can't even afford to provide a 200mbit line to your building. They likely have a line capable of 300+, but with service only capable of around 100mbit at the highest.

That also assumes you can even get all the units to subscribe to the ISP service. Comcast / Charter / Time Warner / ect can make that assumption because they have a monopoly. But any players smaller than them, can't make that assumption. We might only get 20-50% of the units in a building to switch, which (if we're still delivering 200mb to the building) doubles the per-unit expenses to about $400/month each.

Remember, your not just sharing the line, your also sharing the backhaul (the ISP's connection to the internet at large).

>This seems absurd to me, to the point of being unbelievable..., connecting an arbitrary business to a fully-connected residential network will always be cheaper than connecting an arbitrary residence to a fully-connected business network.

This might in theory be true if you have a government blessed monopoly. (Even then, the margins on business service are much higher and cover the lower margins on residential)

But if your ISP is any smaller than Comcast, you probably don't have this. So you won't get every house in a residential area. Which means you'll be paying for a fully-connected residential network, but only collecting revenue on 20-50% of those houses. Which means you'll be paying for lines connected to hundreds of homes which you collect zero revenue on. (Remember, each foot of that network is 33cents, regardless if it's in use, regardless of whether you've subscribed service on it).

Businesses subsidize residential use. The degree to which that happens fluctuates wildly (Comcast for instance, can also use high-margin HBO and TV / pay-per-view / other subscriptions to subsidize their residential costs. "Pure ISPs" cant do that).

> Can I run an HTTP server? I have no idea. Can I use 2TB a month? No clue.

If you don't understand the agreement you signed, call your cable company. They will very clearly tell you "no" and suggest you buy a business class service (which should spell out the extra restrictions you've removed -- or at least, Comcast Business Class does here)

> if you think being "clear" and "fair" is standard business practice for ISPs in the United States you need a real reality check.

We're arguing two different things here. Your saying "my ISP is evil, they use X, Y, Z to do evil, therefore, X, Y, and Z are evil"

I get that. I'm not defending Comcast / AT&T / other shitty ISP's. I'm fully aware that Comcast crazy oversells backhaul in many markets, or is super overzealous on what they allow home users to do. (I live with this reality every day -- Comcast is the only ISP at my home).

But those things aren't evil because Comcast / AT&T use them for evil. If Comcast hops into an fast car and hits a bunch of pedistrians, that doesn't make "fast cars" evil. It makes Comcast evil.

Bandwidth caps aren't inherently evil, they're a useful way for low-volume users to save cash on their connection. Shared connections aren't inherently evil, they're a useful way for home users to get faster burst speeds that they normally couldn't afford.

Does Comcast use those restrictions to do evil things? Absolutely. Does Comcast lie about their restrictions, or purposly mislead folks around them. Certainly. Should ISP's be infinitely more transparent about their pricing and services? Absolutely! (and some already are).

Should we abolish these things just because Comcast uses them for evil? Not at all.

Are you sure about those numbers? That's massively expensive, and it's hard to imagine ever even being profitable. If you charged your users 60 dollars a month at a minimum for access to that line you'd still need a minimum of 33 people, for one area. At just the rates you describes. Let alone the 33 cents per foot for the cable lines going to peoples houses and additional expenditures.

How on earth is the internet even possible at these rates?

Googles charging people 70 a month of gigabit up and down, those are sparsely connected homes throughout Kansas. The monthly maintenance cost alone for one block must be enormous, and for what? Two or three homes each block?

I was willing to accept that they were losing money on this endeavor, but not as catastrophically as this!

> but with service only capable of around 100mbit at the highest.

I can tell you from my direct personal knowledge, that my neighbors' and my combined speed through this ISP can exceed 200mbit, and there is another ISP available in this building that can exceed 110mbit. We are getting a third ISP in 2014 that is several orders of magnitude faster, so that will be at least 3 lines to this 10-unit building that have objectively-measured speeds exceeding 100mbit.

It is entirely possible that this 200mbit+ backhaul is shared over multiple buildings, but if that is the case, I do not notice. I move on the order of 25GB a day, 7 days a week, 365 days a year, and consulting 2 years of router logs suggests that I have never dropped below 30mbit (e.g., assuming both endpoints are up). That is sufficiently close to the performance of a dedicated line that moving any closer is irrelevant for any application I would ever have.

What I am saying is that this shared line is managed very well. And it is reasonable expectation for a user of a shared line that it is managed well. It is a reasonable expectation that the user achieve advertised speeds most of the time, and if this is unachievable, then the ISP should advertise achievable speeds. My ISP is perfectly capable of advertising 200mbit (since it is objectively achievable) but instead they advertise 35mbit. It is true that they do not always achieve 35mbit, but the performance is sufficiently close.

For example, it is at this very moment a peak time for a residential area. A speed test suggests I can achieve 33mbit down (94% advertised speed) and 5.5 mbit up (110% advertised speed). This is well within the margin of "close enough" for people who aren't doing high-frequency trading.

> So you won't get every house in a residential area.

Neither will you get every business in a business area. You have not presented a basis upon which to believe that it is more likely for an ISP in a competitive market to get a business customer than a residential customer. So if we assume the fill rate for a residence is 50%, we should assume a similar fill rate for businesses, and the geometric argument I presented still holds.

> If you don't understand the agreement you signed, call your cable company.

It's not a matter of me "not understanding" the agreement. It's a matter of it being objectively unclear.

The cable company is not the arbiter of what the agreement I signed means. The meaning of the agreement is objectively determined by either a judge or the AAA, the application of contract law in the State of Texas, and a good dictionary. Based on my knowledge of the forgoing, I believe that I could host an extremely high-traffic personal website within the terms of the agreement.

Would they like it? No. Will they threaten to cut me off as a customer? Possibly. Is it a violation of the agreement I signed? No. So here we have a situation where the real rules of the road (e.g., they will stop serving me as a customer if I do this) are not in fact the agreement I signed when I signed up for the service, but are arbitrary and unwritten decisions that are subject to the whim of some person at the ISP. I am saying that your claim that most ISPs have clear and fair written rules is objectively false, because there is no rule in my agreement that prevents me from saturating my connection all the time, and yet there are unwritten rules that prevent me from doing so.