Thursday, January 17, 2008

Five minute thoughts

Thanks to the internet and TV I have a 5 minute attention span, just like everyone else it seems. Combined with blog post formats and Youtube 3 minute videos, we have a contemporary pop culture that encourages affected-ADD.

But instead of rail against that, I'll cherish it with the introduction of Ryan's Five Minute Thoughts. Designed to be readable (and writable) during a Youtube video, or (in my case) a build, they are the ultimate in cognitive adaptation.

Today's 5 Minute Thought (5MT): Comcast's Tiered Service.

TimeWarner is introducing tiered internet plans - presumably in an attempt to either restrain bandwidth usage or raise funds to, and this is highly speculative, build a better network. TW claims that 5% of the users consume 50% of the bandwidth usage. Bandwidth usage is surely only going to rise, with the rise of downloadable video from iTMS and Netflix. Right now video downloaders are a leading-edge case of internet users. Bittorrent and iTunes HD downloads is the future of media consumption.

Cable operators are in an interesting position of offering "unlimited" bandwidth that really isn't. Looks like TW has decided this is untenable and decided to take this leading-edge case as exactly that. Right now it's 5% that consumes half, but soon it will be 25% that consumes 99%. At that point you can't realistically cut off a quarter of your userbase. Given the dim outlook for cable companies and subscriber growth it might make sense to plan for a future where you can accommodate huge bandwidth users without cutting them off.

Core message: Watch out for the leading-edge case users. They might become a large chunk of your business, and if you can't scale to handle them, someone else will for you.


TitaniumDreads said...

"They might become a large chunk of your business, and if you can't scale to handle them, someone else will for you." I agree w/ this statement as it relates to general business practices, but who can really handle high bandwidth users? If a giant company like comcast can't afford it, who will?

My fear is that high bandwidth traffic will simply be cut off and the us will fall even further behind in connectivity.

Ryan said...

The problem with cable operators is they have built their systems based on an assumption of how the internet works. Why they can't seem to make money, when many other providers can (see the French free ISP) I can only attribute to non-technical failings.

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