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IP video

Stream TV Splinters Net Neutrality Debate

Comcast's Stream TV is a different kind of net neutrality problem. The IP-based cable TV service, which doesn't count against users' broadband data usage caps, doesn't travel over the public Internet, but it is accessible on Internet-connected devices, and that's making a lot of industry watchers wary.

The Stream TV issue has popped up again in the news because of reports from TV Predictions and Ars Technica, both of which noticed in an online FAQ document that Comcast Corp. (Nasdaq: CMCSA, CMCSK) is planning to offer Stream TV to non-Comcast subscribers. The service will always require a Comcast-specific modem, but later this year, the company hopes to offer Stream TV to anyone that wants it within the Comcast footprint -- whether they buy traditional Comcast Internet or TV service or not.

The question at the heart of the debate: Is it okay that Comcast's new Stream TV service, which offers live broadcast TV channels, HBO and on-demand content for $15 per month, delivers content to connected devices without that video counting against subscribers' broadband data caps?

I have mixed feelings. On the one hand, Stream TV is a facilities-based service, and a service for which Comcast has agreed to meet certain public interest requirements based on the terms of regional franchise agreements. Over-the-top Internet video services have not negotiated for access to public rights of way for service delivery (that's how regional franchises were designed), and therefore do not have the same spectrum/bandwidth access and rights, but are also not bound by the same requirements.

On the other hand, the bandwidth used for IP-video service and Internet service comes from the same overall pool of spectrum, and there are no rules today about how much bandwidth should be set aside for that "managed" video service versus the public Internet. If bandwidth was infinite, that wouldn't be a problem. But the reality is that Comcast's use of bandwidth for its managed IP video service affects pricing and policies for its Internet service.

Where Comcast faces significant Internet competition, the problem is mitigated. Comcast has to deliver high-quality Internet service at a reasonable price as determined by the market. However, where competition is minimal, Comcast doesn't have to ensure that its bandwidth resources are fairly allocated. It can, if it chooses to, charge a premium for broadband service so that fewer people sign up for higher speeds, and Comcast doesn't have to invest as much money to maintain the bandwidth it needs to deliver both profitable Internet and IP-based video service.


For more on TV technology trends, check out our dedicated video services content channel here on Light Reading.


I wish I had a simple answer for the Stream TV dilemma. Recently I posted my thoughts on the net neutrality issue surrounding sponsored data solutions from wireless carriers. My idea: if carriers allow companies to subsidize content so that it doesn't count toward subscribers' mobile data caps, then carriers should also have to set aside a slice of spectrum for some PEG (public, education, government) programming so that it too doesn't count against users' monthly data allowance. (See How to Solve the Sponsored Data Dilemma.)

But the Comcast issue is a different one, and far more complex. Even worse, there's a good chance that Comcast is using Stream TV as a way to test the waters for a video service that eventually goes beyond its current regional footprint, and its own managed network. To be clear, Comcast says it is not looking outside its footprint today. But it would be crazy for the company not to consider that possibility in the future. The Internet is obliterating artificial geographic boundaries, and with OTT services available nationally or even globally, Comcast has to evaluate its options for competing across the same broad territories. (See Comcast Eyes Global Moves, BYOD & More and Netflix: The Birth of a Global TV Network.)

Again, I don't have a solution for ensuring fairness with Stream TV. The best I can come up with is a wait-and-see approach. And to quote Federal Communications Commission (FCC) Chairman Tom Wheeler: competition, competition, competition.

— Mari Silbey, Senior Editor, Cable/Video, Light Reading

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jsgreenfield 4/6/2016 | 2:34:30 PM
Re: Usage caps @Skippy9250

Everything you are claiming is either false or, on rare occasion, a true statement that has absolutely nothing to do with the issue.

That you believe all these things because they conform to your apparent worldview of your cable operator as the root of all evil doesn't make them true, and restating such false claims endlessly won't make them any truer.

Regardless of what you say, the capital investments required to support the huge growth in utilization are, in fact, enormous and ongoing, and are, in fact, the predominant cost driver for wired (not just wireless) broadband.  Even headend and core routing capacity, in fact, requires upgrading over time, but the cost for that is so small in comparison to last mile capacity, it's irrelevant.  It's last mile capacity upgrades that drive costs.

And that you look to the core to declare "the core is not congested" demonstrates just how ridiculous and contradictory your understanding and claims are.  If the last mile is not the bottleneck, then why would conversion to FTTH even be a consideration?  It wouldn't, of course.  It's only because the last mile IS the primary issue and cost driver for upgrades that discussion of FTTH even comes up.

Cable operators have, in fact, been making enormous capital investments in upgrading last mile capacity, continuously.  That they aren't running out to replace their entire plant with FTTH and presently use it only for new builds is no conspiracy, it's prudent management that benefits consumers.

If one were building out a completely new business/network, FTTH would surely be (and generally is) the choice.  But when one already has an enormous HFC plant that can be upgraded to meet demand at much lower cost, it would be idiotic to switch to FTTH just for the sake of doing so, and would harm customers by increasing costs -- that operators would surely pass on.

There is likely to come a point someday where a forklift upgrade of the plant will make sense, but it's not likely to be anytime soon.  (And when it does happen, it's as likely to be driven by the logistical challenges of managing an upgrade to existing plant, while it is serving customers vs. because it's actually impossible, or even too expensive purely in terms of technology, to upgrade the HFC plant, instead.)

Furthermore, if you actually understood HFC plant and the upgrades being implemented, you'd know that the capacity upgrades to the outside plant are pushing fiber closer to the home with smaller nodes, making any future conversion to FTTH cheaper and easier to implement.

For the time being, the only practical limitation of HFC upgrades relative to FTTH is upstream capacity.  But upstream is not a bottleneck for consumers, so this is only a marketing challenge, as an FTTH provider like FiOS pounds its chest trying to make hay of symmetrical upstream speeds (that are, in practice, irrelevant to almost all consumers).

(And even upstream capacity can be addressed via straightforward HFC upgrades -- but that's where logistical challenges come in, given the complexity of implementing the required changes on a system that's currently in use.)

And finally, unless you're planning to pay me for correcting all of your factual, logical and conceptual errors, I'm not being paid to defend anybody here.  (And if anybody were going to pay me, surely they'd want me to spend my time someplace much more productive and widely disseminated than here!)  I have simply been correcting the voluminous erroneous claims and logic you and others have been posting, because I find them outrageous, and I believe it's important for people to have accurate information to counter that nonsense you and others repeat ad nauseum.  At least a few might still have minds open enough to evaluate these issues based on the actual facts, rather than the imaginary "facts" and accusations you (and plenty of others) mimic (without any actual knowledge of what you speak).

(At that, I will cease wasting time with you here.  You obviously have no interest in trying understanding the actual reality.  And anybody who is interested in such by now has enough information to question the nonsense you're spouting, and dig deeper for themselves, if they wish.)
brooks7 4/5/2016 | 4:29:27 PM
Re: Usage caps "But if the video service happens to be converted to DOCSIS/IP encapsulation (which runs on top of QAM/MPEG2-TS, btw), suddenly you conclude that video is no longer a separate service, but now just traffic on the internet access service."

Because it is exactly the same service as Netflix and must be treated exactly the same.  Since Comcast is counting Netflix then it MUST count Stream.  

seven

Edlt: I thought I should add here.  If Comcast has already broken apart the bandwidth that it uses and has taken a lot of it away from potentially being used for Internet Access (as it does for Linear Pay TV), then it needs the new service to have the rules apply to it.  It could for NOTHING offer a $15/month service via its existing Linear TV.  Heck, they could even add in a STB rental charge and it still be better profit for them (and cheaper for the customers) than Stream.  

But here is the thing. This is clearly an attempt to lock out competitive streaming services and should be shut down. 
Skippy9250 4/5/2016 | 11:46:34 AM
Re: Usage caps "So in fact, usage is, by far, THE predominant cost driver for broadband service."

Again, no usuage is NOT a prodominent cost driver as it cost fractions of a penny to deliver gigs of data. So again, you stating they need to cap or charge overages to recover those cost is a flat out lie. The capital expenditure of virtually all ISPs has been fairly stagnent or lower, so your claim that their capex is so great is again wrong. Now if you want to look at wireless (which is not broad) and make that claim, I will go with that as telecoms have been focusing on that becasue it is cheaper to deploy and much more profitable for their profit sucking shareholders but irrelvant to last mile and actual broadband.


"Such enormous growth in demand requires an enormous amount of capital to build out infrastructure -- e.g., node splits, new CMTSs, etc."

So which of these ISPs are investing in Fiber in the last mile on a large scale, the really only true upgrade they should be doing? Pretty much none and you can't provide facts showing they have been beyond very limited places (Google competition, new subdivisons). So even though the cost of fiber has greatly decreased and the cost to support it is vastly cheaper than copper, they all have pretty much stopped putting money into it to try to change public perspective. This is clear by most of their claims of rollouts being nothing more than press releases. You want to know why they have not been investing? Because your claim that enormous growth is putting such a strain on their network is a farce. Their core networks are plenty capable of handling the bandwidth. You would not be able to show a single major ISP as having any congesting problems anywhere in their core that would justify their caps and overages. Not a single one.


"You seem to imagine that that "maintenance" to prevent congestion is something trivial.  When demand is growing at such enormous rates, it's anything but trivial, because "maintenance" to prevent congestion means constantly building out a ton of additional capacity to accommodate the rapidly growing demand -- precisely as I describe above."


Yes it is pretty trivial and no it does not mean constantly building out. It means doing it right the first time with fiber and not trying to continue to suck on the teet of a 100 year old copper network. These companies you are being paid to defend by misleading the public can afford to rollout fiber to every home and business in the country while paying cash to do it as they couldnt roll it out fast enough to burn through their billions of dollars a quarter in profit.


What you are proposing to allow them to do is a disencentive for them to maintaian and invest in their networks. They will put the bare minimum into the network to keep it going to justify their "need" to cap and bill for overages.You know this and I know this and arent fooling anyone with half a brain that sees through their greedy motives. If you want to continue to push for caps and overages, then they should be fully regulated as a utility: have their nodes monitored with punishment for allowing them to saturate, regulated SLAs, regulated uptime, have their meters certified as accurate and their rates controlled.
jsgreenfield 4/5/2016 | 1:35:04 AM
Re: Usage caps "What kind of BS is this? Once a network is installed there is virtually no cost in sending data so your silly statement is nothing but a PR stunt (lie) to promote meters and caps. Whether a user uses 100k or 100 terabytes a month the actual cost to the ISP is almost unmeasurable in the grand scheme. You claiming more is a flat out lie."

This is simply nonsense.  It's certainly true that opex costs for bandwidth utilization have come down to small levels that are generally not significant.  But it's also irrelevant, because broadband economics are driven by capex, not opex.

Broadband is a capital intensive business, and that capital is driven by usage, and more specifically, growth in peak utilization.  That growth has been enormous for years, with a CAGR on the order of 50%.  (And that's on a per-user basis!)  Such enormous growth in demand requires an enormous amount of capital to build out infrastructure -- e.g., node splits, new CMTSs, etc.

So in fact, usage is, by far, THE predominant cost driver for broadband service.

 

"The ONLY time you need to restrict, or discourage use of a network, is if there is congestion. The only time you will experience congestion is if the network is not maintained as it should be."

You seem to imagine that that "maintenance" to prevent congestion is something trivial.  When demand is growing at such enormous rates, it's anything but trivial, because "maintenance" to prevent congestion means constantly building out a ton of additional capacity to accommodate the rapidly growing demand -- precisely as I describe above.
jsgreenfield 4/5/2016 | 1:17:55 AM
Re: Usage caps "That is correct.  Services need to be independent of delivery mechanism.  The delivery mechanism - IP based Internet Services - are required to be neutral common carriage under Title II.  No matter what content is being carried, no matter what source, no matter if similar services are offered in other ways.  That is the point of Net Neutrality and the point of common carriage."

You don't seem to be hearing what I'm actually saying, so I'll try to say it one last time, differently.

You have two separate services: video and internet access.  You seem to understand that these are separate services when they are delivered using two different technologies -- e.g., bare QAM/MPEG2-TS for one, and DOCSIS/IP encapsulation for the other.

But if the video service happens to be converted to DOCSIS/IP encapsulation (which runs on top of QAM/MPEG2-TS, btw), suddenly you conclude that video is no longer a separate service, but now just traffic on the internet access service.

That is not a reasonable conclusion.  (And that's precisely why the FCC -- a very anti-cable FCC, at that -- even in imposing Title II regulation on internet access services, recognized non-BIAS services as distinct from internet access.)

 

"You are trying to save an industry that is dead."

I'm not trying to save anything.  I'm stating accurate facts and logical analysis in response to mistaken assumptions and faulty analysis based on such.

Whether the industry is alive or dying or dead is irrelevant. (For the record, I have no doubt that the pay TV industry will undergo major changes in coming years.)

 

(Feel free to have the last word if you wish.  I don't expect to respond further, as this does not seem to be productive at this point.)
steve q 4/4/2016 | 10:22:03 PM
Re: Usage caps I think the idea that Comcast has is telling the other if you like to be a leader then you must follow. And the only other company that is able to do that is Verizon FiOS. But for some reason Verizon is not seeing what meaning of streaming service like that of Comcast. With the cost of the cable programing and what people only watch on Tv the best way to provide everyone is though streaming the service at a lower price that fits the customer.
brooks7 4/4/2016 | 12:09:39 PM
Re: Usage caps "You are asserting that use of a common technology -- in this case, IP transport, on the last mile -- by two different services renders one of those services merely "traffic" on the other."

That is correct.  Services need to be independent of delivery mechanism.  The delivery mechanism - IP based Internet Services - are required to be neutral common carriage under Title II.  No matter what content is being carried, no matter what source, no matter if similar services are offered in other ways.  That is the point of Net Neutrality and the point of common carriage.

The equivalent (going back to the start of common carriage) is Rockefeller making it more expensive for his competitors to carry oil on the same trains.  The courts ruled a long time ago on common carriage in that industry.  All pricing for carrying the same cargo must be the same.

By saying that bandwidth caps exist for only a portion of the services, it is a separate pricing scheme for some content (whether it is the company's own content or the content of a partner).  

The fact that Comcast offers to carry the same traffic in Linear Pay TV is irrelevant.  Once the content is in the IP domain ALL traffic is created equal.  So, Stream can not be exempted from the bandwidth cap.

I think STBs policys are like regulating buggy whips.  They are dead with a long tail.  Not worth the time to regulate.  Now if you were Comcast (and you might be), I would think eliminating the need for you to have Linear Pay TV would be a boon to you.  Just let people buy video from the source (Hulu, HBO Go, MLB TV, etc.), deliver great Internet Service, and drop all video processing and delivery at all.  Take the recovered bandwidth and have more bandwidth for Internet Services.  Eliminate everyone in the company that deals with video services outside of NBC Universal. Revenue would go down, but profit would go up.  

You are trying to save an industry that is dead.  Let's take a look....I have all kinds of premium channels and am paying about $190/mo for that.  If I buy:

Netflix + Hulu + HBO Go + CBS All Access + Showtime Streaming I end up paying $45/month.  I can afford to stream several of the major sports as well and still end up saving money.  

The only reason I don't do it right now is that I don't feel like setting up a proxy server to be able to stream locally blacked out sports teams.

seven

 
Skippy9250 4/4/2016 | 11:58:34 AM
Re: Usage caps "Usage metering could only be anti-competitive if it were imposing costs unrelated to the actual cost of service.  That's not at all the case for braodband.  In fact, the problem is actually the other way around, because there is a very large cost associated with usage. (Usage is, in fact, the dominant cost, as broadband is dominated by the capital investments necessary to accommodate massive usage growth.)  It's actually the absence of metering that distorts competition, and is anti-consumer.  (And mere caps, set very high -- as ops have done to this point -- don't come anywhere close to capturing the actual costs of usage.)"


What kind of BS is this? Once a network is installed there is virtually no cost in sending data so your silly statement is nothing but a PR stunt (lie) to promote meters and caps. Whether a user uses 100k or 100 terabytes a month the actual cost to the ISP is almost unmeasurable in the grand scheme. You claiming more is a flat out lie. The ONLY time you need to restrict, or discourage use of a network, is if there is congestion. The only time you will experience congestion is if the network is not maintained as it should be.

I guess you want us to ignore that several ISPs have already openly admitted that caps and overages have nothing to do with congestion or cost and is about monetizing, thus increasing the average revenue per subscriber.


Not a single ISP, other than wireless which is nothign but a 2nd rate on the go connection, has ever shown a need for meters and how they will assist in network management to maintain growth. The shear fact that you can get by their limits by paying more shows exactly that.


I am a consumer with a vested interest in making sure this monopolized industry doesnt continue to bastardize the internet. What is your motive here?
Joe Stanganelli 4/4/2016 | 11:06:01 AM
Re: Usage caps @daniel: Hear hear.

Isn't net neutrality supposed to protect consumers?  But heavens forbid we allow such a renownedly evil company as Comcast to offer a good deal. /sarcasm
jsgreenfield 4/3/2016 | 9:04:29 PM
Re: Usage caps "Network neutrality wants to look at the practice of delivery, not the details of transport. The type of transport does matter; if you're going to meter IP broadband and not QAM video, and the act of metering is the distinction you exploit to gain an advantage, then that is what is directly relevant to network neutrality. But diving too deeply into the technical details becomesa form of pedantry."

I'm having a hard time understanding your comment -- can't tell if you have mistyped in the above.  (Does transport matter in your view, or not?)

The above makes it sound like you believe that usage metering is inherently anti-competitive.

As I said before, this comment thread (particularly with the poor comment system they have here) is too unwieldy to extend the scope of the discussion even further here.  So while I'd be happy to engage the discussion in a more suitable forum, I'm going to resist the urge to respond comprehensively on this point, here.  But I will summarize an alternative view:

Usage metering could only be anti-competitive if it were imposing costs unrelated to the actual cost of service.  That's not at all the case for braodband.  In fact, the problem is actually the other way around, because there is a very large cost associated with usage. (Usage is, in fact, the dominant cost, as broadband is dominated by the capital investments necessary to accommodate massive usage growth.)  It's actually the absence of metering that distorts competition, and is anti-consumer.  (And mere caps, set very high -- as ops have done to this point -- don't come anywhere close to capturing the actual costs of usage.)

Before you dismiss that as ridiculous, I'd suggest you consider the following thought experiment.  Suppose you are a mobile customer who watches very little mobile video, and therefore, pays for only a small data allocation each month.  Then suddenly, all mobile providers decide to switch all customers to one-size-fits-all flat-rate data service.  No longer can you purchase a small plan, and your cost for mobile data service instantly skyrockets. It then continues to increase over time -- rather than decreasing, as it had been -- as the average user consumes more and more mobile data, now that it's "free."  Would that be a consumer-friendly change in pricing?

(And for anyone tempted to answer that "Yes" -- do you, then, also think the current big pay TV bundle is consumer firendly?)

If you want to continue the discussion, Brian, feel free to suggest a more suitable forum.  I don't expect to continue to try to debate the issues here.
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