Monopolists restrict supply

I’m shocked. Shocked.

NBN Co was considering introducing a policy of “fair use” for fixed wireless, Morrow said, so heavy users could be throttled back to the same usage as everyone else during busy periods.

“In the fixed wireless there’s a large proportion [of users] that are using terabytes of data … during the contended period,” he said.

“One of the things we’re evaluating [is] a form of fair use policy to say we will groom these extreme users.”

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20 Responses to Monopolists restrict supply

  1. thefrollickingmole

    So internet is to be “demand managed” the same way South Australias power is?

    Declare the patient cured then bury them.

  2. George

    Entirely predictable when government gets into the free market space

  3. Kneel

    “Entirely predictable when government gets into the free market space”

    Private: “there’s un-met demand – let’s service it and make $!!!”
    Govt: “there’s un-met demand – let’s suppress it with high prices and regulation!!”

  4. H B Bear

    NBN could have been completely avoided with the structural separation of Telstra prior to privatisation. Another failure by The Father of Middle Class Welfare. More dollars for another fan of Big Government to shower pork on the demos come election time.

    The price always comes in the future when they are long gone and enjoying their defined benefit superannuation and Gold Card.

  5. Diogenes

    What’s the big deal ?
    All I/RSPs do it. Google Optus , Telstra , TPG shaping , and you will find them all performing throttling even on the NBN to a greater or lesser extent. It also depends on how much capacity (CVC) they have paid for to get to each of the 121 POIs (thanks for nothing you ACCC dickheads) in which case you get stuck in a queue. ie think of CVC as a private road n many lanes wide…. if it is a single lane, you may dispatch 1000 BDoubles at once, but they ain’t going anywhere, if 1000 then they will all literally fly.

  6. Dr Fred Lenin

    Sell NBN to the Chinese ,assist with thei spying save settin up their own network . They will buy anything ,bet they would improve it no end unlike our muppets .

  7. I look back at all the arguments from the tech ‘experts’ for FTTH, as an example, and every one of them was about providing high quality video downloads and gaming. It was all about entertainment, little of it centred around the so-called business and innovation aspects, remote business, medicine, teaching etc. Probably because all of this could be achieved with far less.

    The issue with the fixed wireless in rural areas is that it becomes impossible for people to get basic internet if the airwaves are being hogged by very heavy users. I live in a rural area, though I’m lucky enough to have FTTN, but many that I talk to in the locality suffer from very poor internet (wireless or otherwise).

    In all honesty, if private industry had been left to provide for rural areas, there’d be no internet available for most people, it would be too expensive to provide. A related example is mobile phone coverage. Why isn’t private industry out here making lots of money from demand?

  8. John Constantine

    An increase in our rations between two and five o’clock in the morning.
    All heil the State.


  9. Jannie

    Grooming was once something guys did to their hair, when they had hair. Now it is a euphemism for rape and control, a tool of the thought police.

  10. Neil

    In all honesty, if private industry had been left to provide for rural areas, there’d be no internet available for most people, it would be too expensive to provide

    The Howard govt had signed contracts with private industry to give rural areas broadband with govt subsidy. One of the first things Rudd/Conroy did was cancel the contract. Opel then sued the govt for breaking the contract

    The Coalition’s 2007 OPEL broadband project would have been a better solution for rural broadband shortfalls than the National Broadband Network, according to Shadow Communications Minister, Malcolm Turnbull.
    Some regional and remote areas have limited broadband access due to lack of competitive backhaul.
    The $600 million OPEL project was to deliver wholesale wireless broadband services to those areas but it was scrapped in favour of the NBN by Labor when the party rose to power in the 2007 election.
    The NBN promises to serve those areas with a mixture of satellite and fibre technologies.
    “If the Coalition Government’s OPEL plan proposed in 2007 had gone ahead, services would already be much better in many of these areas,” Turnbull said.

  11. max

    any private own business would welcome more costumers, but government monopolies do not work like private businesses.

  12. Mother Lode

    any private own business would welcome more costumers, but government monopolies do not work like private businesses.


    A private business makes more money by getting people consuming more of their product. The service part of their business is spending and a risk, counterbalanced by the desire to make money. These are reconciled by deploying the smartest and most innovative people they can find to minimise risk so they can make more money.

    There is no such imperative. They are happy to get more money, and can avoid the unpleasantness of providing a service.

    Demand management.

    I would love to demand manage their oxygen supplies with piano wire around their necks.

  13. The Howard govt had signed contracts with private industry to give rural areas broadband with govt subsidy. One of the first things Rudd/Conroy did was cancel the contract. Opel then sued the govt for breaking the contract

    Indeed. In fact the big providers didn’t want a bar of the rural internet, they wanted to provide for the metropolitan areas first and foremost (and probably nothing else), as that’s where the money lay.

    From memory, Brunswick was the first suburb to be provided with the NBN, even though it already had ADSL, cable, mobile and wireless internet available.

    Rural areas were supposed to be the first to receive NBN, but that soon petered out as governments and leaders changed.

  14. Egor

    The major private use of NBN speed is kids downloading movies.
    A sad waste of $40 billion.

  15. Louis Hissink

    Government monopoly = tautology

    tsk tsk.

  16. Nicholas (Unlicensed Joker) Gray

    Sorry, Louis, but one monopoly is NOT enforced by any government. DeBeers runs a cartel and a monopoly, and they keep getting away with it.

  17. yarpos

    such is the need for control, you would think all these extra problem data packets where being carted to their target addresses in wheelbarrows pushed by armies of public servants. “Fair use” determined by govt? sheesh.

  18. John Constantine

    The DeBeers diamond cartel is a dead duck.

    Even DeBeers themselves are now selling man made diamonds that are identical to mined diamonds, except DeBeers marks theirs with an identity number.

    The chicom and Russian mafia do not mark their man made diamonds with anything at all.

  19. Tel

    Suppose you were running a private company and you are setting up just one single airline route. Where would you likely fly between? Probably between two major cities, I would expect.

    After you have got your airline route up and running, would you run enough flights such that every person gets an aircraft to themselves? Probably not. Would you keep aircraft and crew on standby just in case every person in town all decides to fly at short notice? Probably not.

    Would you charge the exact same price for the guy who turns up at random demanding that he absolutely must leave this very minute, as what you charge for the guy who does a proper booking several months in advance. I’m guessing no to that one as well. Of course the guy turning up at the last minute puts greater pressure on the airline, while the guy who books well in advance is easy to cater for.

    Is this somehow evil, because you didn’t want to run an air route between Dubbo and Bunbury that takes 10 people per week? Is it anti-social for you to build infrastructure based on typical usage patterns instead of catering to the merest whim? No, the point of any infrastructure project is to provide a service where people will use it, at a price set by the market, because if there’s profit then what that means is PEOPLE WANT THE SERVICE BECAUSE THEY ARE WILLING TO PAY. When they stop wanting to pay any extra, that means, on the margin, THEY DON’T VALUE THE SERVICE ANYMORE.

    Let me explain about this whole Network Neutrality bullshit that has come up again and again. Used to be there were multiple services running down the same cable: if you pay for the cable TV service then you pay for both the physical delivery of the movies, and also you pay for the licensing that enables people to make those movies; on the other hand, if you pay for the Internet you just pay for physical delivery of bytes (running on a generic packet protocol that isn’t really designed for movies but can handle video in a so/so manner). The cable TV company needs to allocate guaranteed space for people watching the movies that they have paid for (because that’s how the network was designed) and then they share space of what’s left for general purpose Internet traffic.

    So along comes YouTube and Netflix and others and people say, “OK, I won’t pay for cable TV, I just pay for Internet and then I still get movies but despite using 10x the data of everyone else, I don’t feel like I should pay any extra!”

    Well actually, if you have a lightweight user paying $50 per month for the service of data transport and you also have a very heavy user paying the same $50 per month for the same service, it’s entirely reasonable to give the lightweight user priority and throttle the heavy user … because then both users get something proportional to what they pay for. If the heavy user wants to sit and stream movies all day that uses more facilities, and therefore it’s going to cost extra because you are using it more.

    Trouble is that “Progressive” politics is all about convincing people that it’s just fine to sponge off other people and not pay for the service you use. So they came up with this Net Neutrality concept where the company selling the product cannot charge based on how people use that product, which is counter to every normal notion of how a business works.

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