Perhaps Canada's Videotron needs an economics lesson from Second Life. According to the Globe and Mail, the company says "it will invest $300-million this year as its average customer uses four times more bandwidth than just a year ago."

Sounds like a growing business, but the company's reaction is to urge the Canadian government "to slap a transmission tariff on providers — like the music and film industry — so they can shoulder part of the burden." -- “If the movie studio were to mail a DVD . . . they would expect to pay postage or courier fees,” Depatie said. “Why should they not expect a transmission tariff?” He left unclear whether "whether such a tariff would be passed on to consumers through higher download fees." "But Depatie said he's against raising rates for Internet service and that it's only fair for content providers to help foot the infrastructure cost."

All of this is utterly baffling. Does he think the content producers can somehow avoid the need to recoup their costs from the prices they charge their customers? Does he think fairness requires that customers who use little bandwidth subsidize the movie gluttons? Why does Videotron need the government to act as a middlman? (Of course, the proposal may be nothing but an effort to transfer the costs from the Quebecois to U.S. consumers.)

The simple answer is to charge customers for high speed, or for bandwidth actually used, and/or charge content providers for premium services and the market will utlimately make everyone as happy as possible. They won't be perfectly happy, because they would prefer to have unlimited bandwidth at no cost -- but only a copylefter regards attaining this as a reasonable goal, or perhaps even an absolute human right.

posted by James DeLong @ 9:12 AM | Telecom

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