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Where's The Meter?

Om's post of this past Thursday, aimed squarely at Comcast, asks the question "Where's the Meter?"

That reminds me of the old Wendy's commercial, "Where's the Beef" and at the same time "Show me the Money" from Jerry McGuire fame.

Here's my take.

1) Cable companies have never cared how much tv you watch.

2) Cable companies have used UNLIMITED telephone calls to take customers away from the telcos.

3) Cable MSOs have become the market leader in delivering broadband to the home and as a result, have accomplished number two at the peril of the telcos.

You don't see Comcast saying "Mrs. Jones, you watched too many soap operas, spent too many hours watching HBO and your kids spent hours watching Disney kids."

Why not?

Because they are paid not to. Beyond the local must carry rule that requires cable MSO's to carry the local tv stations, each home that is served and each cable box installs carries with it a payment back to the cable channel from the MSO, which is taken from the monthly subscriber fees or from payment for premiums channels as WikiPedia points out.

Basic cable networks receive at least some funding through fees paid by the cable TV systems for the right to include the network in its channel lineup. Most basic cable TV networks also include advertising to supplement the fees, due to their programming cost being greater than the fees paid by cable TV systems. Premium cable refers to networks, such as HBO, Cinemax, and Showtime, that scramble or encrypt their signals so that only those paying additional monthly fees to their cable TV system can legally view them (via the use of cable box or converter). Because these networks command much higher fees from cable TV systems, their programming is generally commercial free.

We are about to enter a time where the content providers need to start to pay the cable operators and other ISPs for the delivery of their rich media content, because in an era of metered bandwidth, the reason the MSO's need to charge for that is they are losing eyeballs from their commercial supported business. TV. That means the likes of Google with YouTube, Apple with iTunes, and everyone else will need to figure out a way to share the pie, instead of making billions off of OPM (other party's megabytes).

The second piece of the pie that needs to be addressed is the difference between business Internet and consumer/residential Internet. As a teleworker I am willing to pay more per month for a better grade of service, guaranteed up-time and shorter repair cycles. I'm not willing though, nor would other business owners, want to pay more for sharing the same pipe that goes to the kid down the block playing games, running P2P services for videos and music downloads and more.

What Comcast failed to show was the meter. They also, as Om points out, played bully saying "go over the limit twice and we turn you off." Instead they should say "go over and you pay this penalty or move up to a higher rate plan."

For the person who makes their living off of the Net we'll likely pay the price. That will lead to municipalities looking at how they can make money off of access, and in turn create a competitive environment.

Comcast's mistake is they're in a monopoly situation. By becoming the bully in the neighborhood and with a changing political climate in the USA, the bully won't be standing around long. My guess is we'll start to see more effort placed to opening up competition with cable companies, just like we saw with the telephone company.

History always repeats and what's more, we're entering an era of even great need for more people to work anywhere, not drive as far, if at all, and most of all, to inspire growth in the economy.

When all that happens, Comcast will be likely wishing for the day they had the customers who were moving that much data.

As one of their largest shareholders will understand very clearly:

There's greed. And there's 'anti-greed.' What Comcast is doing now is totally anti-greed.


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