Data Cap for Monopoly?

I just read two articles on Comcast.  The first is about its proposed acquisition of Time Warner.  Evidently, the FCC has received some opposition to allowing the acquisition, because Comcast uses some rather monopolistic practices.  More or less, Comcast and Time Warner are using their size and market share to manipulate content providers into paying for services that most ISPs gladly provide for free.  Notably, one of the complaints comes from Netflix, because Comcast and Time Warner refuse to provide direct connections for free.

Direct connections to major content providers dramatically reduce internet congestion and improve the ability of ISPs to provide good quality media streaming.  As such, ISPs that provide direct connections to major content providers benefit themselves and their customers dramatically.  Very large ISPs, like Comcast, however, use their size to force content providers to pay for these connections.  Ultimately, the content providers feel forced to comply, because without the direct connections, their services will perform poorly for customers of those ISPs.  Sadly, the customers blame the content providers, even though the fault lies entirely with their ISPs.

The second problem with Comcast is its attempt to redefine language.  According to Comcast, charging extra when a subscriber goes over a data limit is not technically a data cap.  The FCC definition of "data cap" actually includes this kind of subscription model, with a clause explicitly exempting Comcast from this definition (the FCC working group that drafted this definition includes a Comcast VP, who presumably is responsible for this clause).  Evidently Comcast's size and market share gives it the power to define language in its own terms.  Note that the term "data cap" is commonly used by ISPs and individuals to mean any data limit, whether it be a hard limit or a sort of uptier limit where extra charges are applied when the limit is exceeded.  It is clear that Comcast believes itself to have power to alter the meaning of language.

The second problem is worse than the first, but they come down to the same thing.  Comcast's motive for using data caps* is exclusively financial.  Most data caps imposed by smaller ISPs exist to combat network congestion.  Comcast is large enough that it does not have congestion problems, but they would rather charge data caps to pay for upgrades than use a portion of their already very high profits to pay for them.  There is another, more nefarious and legally questionable reason for Comcast's data caps though.  Comcast does not count data transfers to and from its own services against the caps.  This means that customers using data heavy services may feel compelled to use Comcast's services instead.  Now, I do not know exactly what services Comcast offers, but I could easily imagine some examples.  Note that even if Comcast does not offer a specific service, it could easily add it at a future date.  The first service that Comcast could offer is a video streaming service.  Video streaming from services like Hulu or Netflix are certainly data intensive, and regular use of those services could easily hit a fairly large data cap.  If Comcast offered its own video streaming service, many customers might feel like they have to use Comcast's services instead of Netflix or Hulu, to avoid paying fees for exceeding the data limit.  This applies equally to digital media sales services, like those provided by Amazon.  Digital video files are large, and can be consumed faster than streaming video (because you can download many at a time, at a faster rate than you can view them).  If Comcast offered this sort of service, a data cap would definitely give it an advantage in the market of its subscribers.

The thing that all of these problems boil down to is monopoly.  Comcast is leveraging its huge market share to force content providers to pay for services that other ISPs provide for free, because they benefit both sides equally.  This is a monopolistic practice.  Comcast uses a data cap to increase its revenue, and gets away with it because of its huge market share.  Again, this is a monopolistic practice.  Lastly, and the worst of them all, Comcast uses its market share in its ISP service to gain an unfair advantage in its other services.  This is an extremely  monopolistic practice.  In fact, large companies have frequently been punished by the government for this last practice.  The MS lawsuit over its inclusion of Internet Explorer in the US (and Windows Media Player in the EU and now in China as well) was based on the fact that MS was using its Windows market share to give it an unfair advantage over other browser (and media player, outside the US) makers. This is monopolistic because it is using the popularity of one product to sell another unrelated product (internet connectivity vs internet based service, very similarly to operating system vs application).  Further, it is not just abusing the market share of one product to sell another unrelated product (IE and Windows Media Player might seem free, but the price is included in the cost of Windows); it is actually putting customers in a position where they are effectively being fined or otherwise charged extra for using someone else's product too much.

Very few ISPs do the oppressive and monopolistic things that Comcast does.  Most ISPs now offer unlimited data in all of their non-business packages.  Most ISPs provide direct connections to content providers at no cost, because they benefit just as much or more.  Most ISPs do not have enough market share to leverage things like data caps and direct connections to rip off customers and compete unfairly with content providers.  Most ISPs do not make anywhere near the profits Comcast does.  Comcast is not doing any of this because it is necessary to remain profitable.  It is doing all of this because it wants more money and it has the power to get it.  If it acquires Time Warner, it will control even more of the internet.  We should be seriously worried about one company having this kind of power over our largest communications system (especially when that company thinks that it can just redefine language to avoid looking bad).  Comcast is already acting in ways that have been established as monopolistic and illegal in the US and most of the rest of the world.  While we should be worried, it is the government's job to protect us from this.  Not only should Comcast not be allowed to increase its monopoly by acquiring Time Warner, it should be the subject of a serious government investigation for monopolistic practices.



Here is the article on data caps definition: http://arstechnica.com/business/2014/08/comcast-tells-government-that-its-data-caps-arent-actually-data-caps/

* If some Comcast executive reads this and suddenly feels compelled to demand that I use a different term, let it be known that I will not.  Bullying large publications might work, but I am not going to redefine language based on the delusions of grandeur of some company.

Open Source Software in Business and Government

I have read some emails sent between government workers recently and have been lead to the conclusion that we need a higher degree of awareness of open source software alternatives in government agencies and businesses.

Many, upon hearing about open source software make comments about how nothing is free, or how software made by people in their spare time cannot be as good as software made by companies that dedicate all of their resources to making good software. First, while everything good requires work from someone, people often choose to give service at no charge. Consider charities for a good example of this. Open source software is like a charity, only better, since the work of one person can benefit everyone willing to take advantage of it. Second, most software companies have a limited amount of personnel to program and test software, while open source software can be programmed, tested, and reviewed by anyone with a decent computer.

One thing people do not realize about software companies is that their goal is not to make good high quality software; their goal is to make as much profit as possible (they are legally required to maximize profits for their shareholders). This means making software that is just sufficient to make people willing to buy it at the price being charged. This means that a bug that will not effect most users will probably be ignored unless it is really easy to fix. This also means there will only be enough features to make it sufficiently more useful (or flashy) to make consumers want it over competitors software.

Another major problem with proprietary software in government is that software companies usually use proprietary formats for saving data, so that customers will be forced to continue to use their software instead of switching to a competitor's product. The problem with this in government (as noted in several of the emails) is that most government data is legally required to be retained in a publicly readable form, permanently. This means that if I do not own the proprietary software used to record the data, it is not readable to me, a member of the public. In addition, if future versions of the software remove support for that specific proprietary format (this is a very common technique used to force consumers to upgrade to a newer version), and old versions are no longer licensable (ie, the company stops selling the older version), the data is no longer readable by anyone who did not buy the software when it was on the market. Essentially this means that it is actually technically illegal for government organizations to store any data solely in proprietary formats, because the data cannot be considered permanently available to the public.

Businesses should also consider this. Once again, there are records that businesses are required to keep that must be in a presentable form for government inspections or audits. If the business changes its software to something that does not support the old software's format, the business could be in deep legal trouble if they get audited. The government officials do not care if the company changed its software, they want to see the records and if the company cannot produce them in a format that is readable, the company is going to get fined, or worse.

Using open source data formats can alleviate these problems. Among other things, most open source software still supports the original data formats it originally used, even if it normally uses a newer format now. Besides that, if your records are stored in an open format, even if the software that can open it no longer exists, you can find the original formating information and construct a simple program to display the data or convert it to a newer format.

These are the purely technical reasons for using open source software as opposed to proprietary software. Following are some less technical, but just as important reasons for using open source software.

Earlier I debunked the myth that software companies have more reasons and resources for making high quality software. Here you will find why open source software is often considered much better than proprietary software. Most people that are working on open source software are not getting paid for it (some companies do pay some of their programmers to help work on specific open source projects). This means that their incentive for making the software is not to earn a paycheck. Most people working on open source software are doing it because they intend on using the software and they have a specific interest in its functionality. This means that they actually want the software to work properly. If you research open source software you will find many projects that claim they are not suitable for commercial use at this point. If you use these programs you may also find that they work as well or better than many programs sold by software companies as commercial products for commercial use. The reason open source software is often superior to proprietary software is specifically that those making it aren't being paid to make it. Also, as I mentioned earlier, since anyone with a decent computer can test it, bugs are weeded out much more quickly and efficiently, and frequently new features are added as suggested by those using the software (or even added by those using the software).

Finally, one of the best reasons to seriously consider using open source software in government and business is that it is usually free. Anything that can replace a high cost commodity in government or business at no cost should be seriously considered. I have seen arguments over availability of documentation, training, tech support, and other things as reasons for avoiding open source software, but a few Google searches will quickly reveal that the community of open source software users are far more friendly for sharing information than anyone using proprietary software. Some open source software may not include as good documentation as some proprietary software, but free technical support is far more available on the internet for open source software (and you don't have to spend hours on hold waiting to talk to some guy in India who doesn't even understand english).

Switching to open source software can save large organizations enormous amounts of money. The last time I checked, Microsoft Office cost $160, if you have to buy Office for 200 computers (not unusual for large companies), that is costing you $32,000. This is just one piece of software. Adobe Photoshop CS4 costs almost $700, Adobe Illustrator CS4 costs over $300, and Adobe InDesign cost from $250 to $300. A graphic design studio could save $1,250 or more per computer using The GIMP, Inkscape, and Scribus, free open source alternatives to the proprietary programs I have mentioned above. Businesses may be able to negotiate lower prices for buying in bulk, but they can't beat free.

I would like to recommend government agencies and businesses to look for open source alternatives to the software they buy large amounts of, or pay large amounts for. If you find alternatives that appear to have any potential, download them and evaluate them. The only costs incured for evaluation are man hours, and with the potential savings, it is well worth the time spent. Just don't forget that any new software is going to have a learning curve. Remember this if, after five minutes, you decide that the software is difficult to use. If it was really that hard to use, would there be enough interest in it for it to be worth the work people are putting into it? Give your evaluators a little time to learn to use the software, then watch them use it and decide if your proprietary software is really worth the licensing costs.

Lord Rybec

New Software Development Model

Microsoft has come up with a novel new development model that saves them tons of money. Actually, not only does it save them money, they actually earn money with it.

Microsoft has successfully convinced consumers to pay to beta test their products. In traditional software development the developer normally hires people to test their software to find bugs and other inconsistencies that might affect the performance of the software. Many software companies have been 'allowing' individuals to test their software for free over the last few years. Microsoft has gone one step further.

Microsoft has begun releasing beta software for individuals to test as well, but now they are charging for the 'privilege'. The trick is that they don't tell you that the software is only beta level. Microsoft puts it on the store shelves as a finished commercial product, when in reality it is early to mid beta level software. If Linux or Mac tried that, only hard core fans would ever use the OSs, but Microsoft has managed to slowly break down consumers expectations to a point where the consumers not only willingly use half finished software, but the consumers actually pay for the experience.

The U.S. needs an Underwriters Limited for software. Obviously Microsoft's quality control is unable to accurately discern the actual quality of the software. The solution is to have an independent organization analyze and test the software, like UL tests hardware. Of course, Microsoft would really hate this, since competition from Linux and Mac would squash them in the quality department and Microsoft would never have any of their products listed by the organization.

Lord Rybec