Broadband data expiration: ISPA considers the CPA issue

[Bern]

All we need is clarity and choice, nothing more - the market will then dictate what options are best. It would be nice to get some more flow options, but with more detail as to how the network is shared and perhaps on utilisation. I would like to know for example the contention ration to my exchange/tower, local loop and international as well as shaping policies used to try ensure reasonable user experience.

 

[jannievanzyl]

If you said anything else you may loose your job so your comment was expected

Rather than showing your ignorance with such a profound statement (not), why don't you try and understand the underlying technologies and why the concept of rollover is inherently alien to how data networks work? And how the conversion of bits/second into bytes creates the problem.

We've discussed this at length on this forum. Maybe read some of the posts.

 

[jannievanzyl]

Has anyone tried selling the data like uncapped? They buy transfer rate, so sell transfer rate.

Absolutely.

By not converting the data from a timebased unit (bits/s) into a fixed size (bytes), you avoid the whole problem.

But you do open up a new problem, that of affordability vs. performance. Most people want a high speed connection but ONLY when they access the network to do their work. Selling in bits/s at a high enough rate (say 1Mb/s) would be extremely expensive.

To get in the current 1 to 3GB price bracket, you'd have to limit the speeds down to 9k6 or 19k2.

And no-one would be happy with that.

 

[jannievanzyl]

I don't mind bandwidth expiring, the problem is that if we use too much too soon we get caught in the trap set out - the OOB rates. So we try and balance it out and there is no sweet spot for the consumer.

3 options on how to avoid this (at least from a VC perspective):

1. If you're a contract customer use Advanced. OOB=IB = no OOB Bill shock
2. If you're a Top Up customer, you probably won't have any spare money lying in your IN account. No ability to go OOB = No OOB bill shock.
3. If you're a prepaid customer, you probably won't have any spare money lying in your IN account. No ability to go OOB = No OOB bill shock.

 

[Dolby]

Wouldn't a longer roll over period cause less spikes, more stability and even things out on the network?

I'd image that come month end, you have people simply using data to prevent the ISP taking it away

 

[jannievanzyl]

Wouldn't a longer roll over period cause less spikes, more stability and even things out on the network?

I'd image that come month end, you have people simply using data to prevent the ISP taking it away

While there must be some of it going on (month-end download rush), I've been looking at the utilisation graphs for many years and don't see it, so the answer seems to be no to your question.

 

[Tricky]

It is a good analogy, and the people here who are moaning are only doing so because they like getting everything for free or on the cheap. I know, I feel the same way!

I have to mention however that when you chose the monthly cap deal you were already being discounted. Most ISPs actually have services labelled as prepaid and these bandwidth allocations usually don't expire. But when you commit to a monthly amount which does expire, you're getting it at a better rate.

 

[MickeyD]

While there must be some of it going on (month-end download rush), I've been looking at the utilisation graphs for many years and don't see it, so the answer seems to be no to your question.

In the light of these utilisation stats, is VC considering a longer roll over period?

What will keep the CPA hawks happy? 6 months?

Is there also a financial aspect to this issue, e.g. accrued revenue? Do your current systems have the capacity to accurately track it?

 

[jannievanzyl]

:facepalm: of course you cant store unused data, you cant store something that doesnt exist

when you pre pay parking you are essentially hiring the bay, you can choose to park in it or not. they dont hire them out in batches of "30 parks", but rather days.

crap analogy

And what happens if you paid for the month's parking and you park in it for only 20 days? Do you then have the right to park there for any 10 days of your choice anytime in the future? Even if the owner subsequently rented the parking space to a new person?

That's what you're suggesting with rollover. You bought capacity on a network (a data bundle) but you never used it. The capacity was paid for by the network but now, a few months later, you want to use it. This implies the operator must now buy additional capacity to service you but cannot recover the costs.

Just like the parking lot owner must build extra bays in case someone who did not use their parking for all 30 days and now insist those unused days should've rolled over so he can use it whenever.

Good analogy.

 

[jannievanzyl]

In the light of these utilisation stats, is VC considering a longer roll over period?

What will keep the CPA hawks happy? 6 months?

Is there also a financial aspect to this issue, e.g. accrued revenue? Do your current systems have the capacity to accurately track it?

As already discussed, a longer roll-over period will have an impact on pricing but I don't think it's fair to let everyone pay because some want a longer rollover. Thus my idea of a VAS, where a subscriber can buy a rollover period over the standard 30 days.

When I asked this forum recently if they want longer rollover but pay a premium, vs. 30 days at a lower rate, you can guess which option was chosen.

The CPA 'hawks' clearly understand the application of Section 63 in that it applies to the lifespan of the voucher and not the lifespan or business rules of the product the voucher delivers. ISPA is quite correct in their interpretation.

You're spot-on on the financial aspect, BTW.

 

[zamicro]

And what happens if you paid for the month's parking and you park in it for only 20 days? Do you then have the right to park there for any 10 days of your choice anytime in the future? Even if the owner subsequently rented the parking space to a new person?

That's what you're suggesting with rollover. You bought capacity on a network (a data bundle) but you never used it. The capacity was paid for by the network but now, a few months later, you want to use it. This implies the operator must now buy additional capacity to service you but cannot recover the costs.

Just like the parking lot owner must build extra bays in case someone who did not use their parking for all 30 days and now insist those unused days should've rolled over so he can use it whenever.

Good analogy.

The problem is that you are not selling me guaranteed access at full speed. A better analogy would be that the parking garage with 1000 bays are rented to 20000 people who do not park there every day, but only once in a while. Thus it would be fair to suggest that your unused parking days be carried over to the next month

 

[jannievanzyl]

The problem is that you are not selling me guaranteed access at full speed. A better analogy would be that the parking garage with 1000 bays are rented to 20000 people who do not park there every day, but only once in a while. Thus it would be fair to suggest that your unused parking days be carried over to the next month

Actually, we're on the same page. As some people have already explained above it's exactly these factors that are all melded into the price. So I could ensure that we'll have enough space for you to park whenever you feel like it and will reserve your space for you, even if you don't use it often.

But I'll need to build a bigger parking garage to do this and will have to pass the cost somewhere.

 

[alt21]

What about give us what we pay for and if you feel you need to charge us more (not that you really need the extra profit) then do so instead of trying to convince us that its in our best interest to have our cap not roll over.

 

[sand_man]

We should pay for what we use. Billed monthly per mb and at a reasonable rate, how does R0.10c per mb sound to you?

 

[icyrus]

What about give us what we pay for and if you feel you need to charge us more (not that you really need the extra profit) then do so instead of trying to convince us that its in our best interest to have our cap not roll over.

Because if telcos gave you transparency in their products you would know exactly how thoroughly they're fleecing you.

 

[system32]

Q. Should your broadband data expire?
A. No.

Marc Furman is just spin doctoring the fact that they are in violation of Section 63 of the CPA.

We predict that it will have the effect of driving up prices considerably,” said ISPA joint chair Marc Furman.

Where's the proof or explanation of the statement - drive prices up?

Sounds like the argument that LLU and naked ADSL will drive the prices up - but no proof is provide.

“Applying Section 63 of the CPA in this way to bandwidth would actually have the unintended consequence of disadvantaging consumers rather than protecting them,” Furman concluded.

Another statement with no logic or explanation.
I would rather the protection of the CPA, than the forked tongue of ISP's/MTN/VC/Cell-C/Telkom/etc.

ISPA urges ISPs to spell out the contractual details of each data bundle very clearly to consumers, explicitly stating when data does not roll over from month to month.

That's the crux of the problem - ISP's don't tell you until they steal your unused, paid for data bundle.

I would rather they comply with the CPA, so that we can make a fair comparison between products.
They all expire at the same time, and you can make full use of what you paid for.

Even if prices go up, the consumer will get better value.
eg. I purchase 2GB for R389 from MTN PAYG, I have 30 days to use it.
If I use 1GB and end up losing 1GB, so I effectively payed R389/GB
I would rather pay R400 for 2GB and have 3 years to use it.
R200/GB is way less than R389/GB in the example.

You can spin it which every way you like, we know you talking BS.

Strange how many clauses the ISP's/MTN/VC/Cell-C/Telkom/etc had to remove from their contacts because of CPA, as they were deemed to be unfair to consumers.

This is just another example of unfairness to the consumer.

 

[Lounger]

Actually, it's a very good analogy.

A parking lot has a fixed capacity, it can only take so many cars at a time. Then you chop it up into smaller spaces and sell those on a time basis.

Networks are also physical with a fixed capacity.

The authors point is valid. What would happen if half the people did not use their parking and then all show up the next month, claiming their space? There won't be enough space for all of them.

You can't 'store' unused parking space. Just like you can't store unused data.

If someone doesn't use the parking space, another person can. There is no loss. The difference is that the cell company takes the data and resells it to someone and the customer loses out.

It's a very bad analogy.

 

[Chevron]

And what happens if you paid for the month's parking and you park in it for only 20 days? Do you then have the right to park there for any 10 days of your choice anytime in the future? Even if the owner subsequently rented the parking space to a new person?

That's what you're suggesting with rollover. You bought capacity on a network (a data bundle) but you never used it. The capacity was paid for by the network but now, a few months later, you want to use it. This implies the operator must now buy additional capacity to service you but cannot recover the costs.

Just like the parking lot owner must build extra bays in case someone who did not use their parking for all 30 days and now insist those unused days should've rolled over so he can use it whenever.

Good analogy.

Cannot recover costs?

That doesn't make sense. You received the cash with the initial transaction. There are no extra costs.

 

[Gaz{M}]

Cannot recover costs?

That doesn't make sense. You received the cash with the initial transaction. There are no extra costs.

Actually, it costs the networks a few dollars a month for licences for each and every subscriber on the network, so there are on going costs, including internal costs to support your services, financial reporting etc. If you bought a 1GB bundle for R200 and had 3 years to use it and never again recharged or purchased any other bundles or services, the network has to keep you on their system for 36 months for R200 and make sure there is bandwidth the entire time to meet your unpredictable usage of data.

If all bundles had 3 year expiry dates, the prices would definitely have to increase, since nobody would buy the smaller bundles anymore (10MB, 100MB, 200MB etc.). So, it would make more sense to buy the cheaper "per MB" bundle and use it over 3 years. The smaller, more expensive bundles earn the revenues that the networks use to balance their books and subsidies the 'cheaper' bundles and services. If anything, we should complain about the high cap/uncapped people getting really cheap MB's that we have subsidized (this applies to ADSL accounts too).

However, I think in this debate their is a middle ground, where consumers have a choice of bundles that expire in 30/60 days and 3 years. Obviously pricing will be adjusted to take into account the above issues.

Cell C and 8ta have launched bundles with a 1 year expiry, and the pricing is very competitive with 60 day data bundles. The other networks need to follow suit.

 

[Chevron]

Actually, it costs the networks a few dollars a month for licences for each and every subscriber on the network, so there are on going costs, including internal costs to support your services, financial reporting etc. If you bought a 1GB bundle for R200 and had 3 years to use it and never again recharged or purchased any other bundles or services, the network has to keep you on their system for 36 months for R200 and make sure there is bandwidth the entire time to meet your unpredictable usage of data.

If all bundles had 3 year expiry dates, the prices would definitely have to increase, since nobody would buy the smaller bundles anymore (10MB, 100MB, 200MB etc.). So, it would make more sense to buy the cheaper "per MB" bundle and use it over 3 years. The smaller, more expensive bundles earn the revenues that the networks use to balance their books and subsidies the 'cheaper' bundles and services. If anything, we should complain about the high cap/uncapped people getting really cheap MB's that we have subsidized (this applies to ADSL accounts too).

However, I think in this debate their is a middle ground, where consumers have a choice of bundles that expire in 30/60 days and 3 years. Obviously pricing will be adjusted to take into account the above issues.

Cell C and 8ta have launched bundles with a 1 year expiry, and the pricing is very competitive with 60 day data bundles. The other networks need to follow suit.

No one said anything about 3year bundles.

1 or 2 month rollover is all we're asking for. Then I'd buy 100gig bundles. My usage constantly varies between 70-150 gigs. So the current way this work is not optimal for me. Some months I'd buy 150gigs only to have 80gigs fall away?

It's profiteering.