Just looking at a price list of discount calls to Lithuania from the UK, I notice the following:
important notice: we have been getting reports some numbers, usually the lowest cost ones are inaccessible at times due to capacity problems, this is why we supply a sorted list, use it :-)
I wonder how long it will be before there emerge “discount” internet connectivity providers with, ahem, less than comprehensive peering arrangements. You can try calling Aunt Maude in Melbourne via Skype, but the packet loss will be too horrendous for it to be practical.
In one way it wouldn’t be a bad thing, because price discrimination lowers average prices and increases average consumer welfare. (You really don’t want all those airline tickets to be one fixed price.) But the consumer is very unlikely to be able to know what they’re really paying for here. A business class broadband connection isn’t as visibly different as a business class airline seat. Whilst there are surveys published of broadband speeds, it’s a bit late if you’ve just locked yourself into a 12 month contract based on the false promises of a broadband sales rep. And those survey speeds are just aggregated, with no breakdown into national, regional and global connectivity.
Inevitably this is going to be a case for regulation. The market failure is one of misrepresentation and asymmetry of knowledge between buyer and seller. How would I do it? Your broadband quality would be listed in the same way a new car’s fuel consumption is rated. Get a third party to do independent monitoring, force each provider to participate. Rate every month based on congestion (how fast compared to advertised speed) and connectivity (how even speed is to globally dispersed points). Repeat until false.
Posted by Martin Geddes at 11:56 AMTrackBack URL for this entry:
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Well you're right, especially as why would I need for a best-available QoS in those circumstances when I make a call to a destination like Lithuania where I know that anyway call termination is not very good ...
Can Skype actually do that ? Would not it lower their fees with their call termination partners if they adapt the QoS to a lower value when the call is terminated in an area with poor call termination ... ?