
Deutsche Telekom kills fixed line IP flatrates - rmoriz
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derda
Their objective is clear: Promote their own cloud-services and make deals with
cloud-service providers, since those services are not metered. They already
have a deal with Spotify in place for their mobile network ( bandwidth
throttling, after a certain volume is already common practice for all
providers ). So effectively their are killing net neutrality.

I hope that plan strikes back and they loose money and customers over this.

~~~
klaustopher
The only problem is that they OWN most of the cables and most other providers
need to rent at least the "last mile" or maybe even other parts of their
infrastructure (i.e. 1&1 uses Telekom DNS services) so there is a big chance,
that others will follow :/

~~~
derda
But they only rent the last mile from the Telekom. Starting at the DSLAM they
usually bring their own infrastructure. (Except reseller contracts).

In the last years there also have been many small, local ISPs popping up,
often partly owned by the city (Stadtwerke). Some start rolling FTTH
connections and finally bring germany to the internet-first-world.

Cable providers, at least Kabel Deutschland (which is the only option here
where I live), are sadly no alternative, while they offer high bandwidths
without volume based throttling, the traffic shaping they do at peak times and
for torrent traffic is ridiculous and makes their service almost unusable.

~~~
klaustopher
I am lucky enough to live in Cologne we have fibre in almost every household
(NetCologne) so I don't really worry .. But still most people have to rely on
Telekom offerings cause there are no other options.

~~~
pimeys
In Berlin the situation is quite bad. There are these moronic DSL providers,
which deliver the connection when they feel like it. It's quite expensive,
slow and there are interruptions quite often.

The alternative is Kabel Deutchland. Their connection quality is pretty ok,
but the throttling every evening when I get home from work is annoying as
hell.

What I really miss from Helsinki is that when you order e.g. a cable
connection, they'll deliver it the same day when you made the contract. It's
fast and reliable. No throttling, no limits.

Although I understand why the situation is what it is. And still I'm not
complaining, this connection is good enough for the most of the time.

------
klaustopher
Worst part is that they are excluding their own services from that traffic. So
you can watch Telekom IP TV without buying a traffic extension, but for movies
from the iTunes store you have to pay iTunes for media and Telekom for
traffic. Nice one!

~~~
Idioteque
This is why we need net neutrality regulation in Germany.

~~~
klaustopher
This is why we need the state to take back the phone network it paid for in
the first place, manage it and rent it out to the Telekom like any other ISP
...

~~~
Karunamon
Having the state own that infrastructure introduces its own concerns though,
especially re: privacy and anonymity.

~~~
jevinskie
It hasn't been an issue in the US. The telecoms voluntarily provide sensitive
customer info to the government.

~~~
mpyne
Ironic then that if you had sent those same communications through the
government-organized postal service that it would be much more difficult to
legally divulge that info to other parts of the government.

------
DasIch
The Pirate Party, Social Democrats and the Greens already want net neutrality.
Nice of the Telekom to play the bad boy who will cause a net neutrality law.

~~~
aluhut
Well two of them won't make it into any decision making position after the
next election and we know what happens to the Social Democrats in a big
coalition...

"Wer hat uns verraten..."

~~~
skrebbel
No, we don't know. This is HN, not forum.discussgermanpoliticsinenglish.com.
Care to elaborate?

~~~
fosap
"Wer hat uns verraten... Sozialdemokraten" is a rhyme and means "Who betrayed
us? Sozialdemocrates!" originally used by communist because the
Sozialdemocrates never where revolutionary or anti-capitalist.

The slogan is used right now to say the SPD is very weak on all their
positions and a fan of half hearted compromises.

~~~
mtowle
>The slogan is used right now to say the SPD is very weak on all their
positions and a fan of half hearted compromises.

Funny how pervasive the "progressive* party leadership has the will but
doesn't know the way" trope is across progressives of all stripes and nations
(e.g., Mr Obama's perceived capitulation on the so-called Public Option for
healthcare). One could probably write a doctoral thesis analyzing the reasons
for the ubiquity of the sentiment!

*Word chosen over 'leftist' or 'democratic' to avoid differences in meaning from country to country

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mtowle
_This translation leaves a lot to be desired. Some people in the comments look
like they could benefit from a better job of it, so here you go:_

After the information was initially leaked, Deutsche Telekom has officially
confirmed that they plan to introduce volume restrictions (throttling?) for
all landline broadband connections from here on out. Starting May 2nd, the
performance specs for all new contracts will include a fixed bandwidth
restriction dependent on total upload/download volume. For the time being, the
new restrictions won't affect existing customers.

Till now, Deutsche Telekom had only ever introduced such stipulations on VDSL
("very-high-bit-rate DSL") - and fiber-optic connections with download speeds
between 25 and 200 Mbps. After reaching a monthly download limit of 400Gb for
customers with 200 Mbps connections and 75Gb for customers with up to 16 Mbps,
the throttled data rate drops down to a uniform 0.384 Mbps - regardless of
previous connection speed. (50 Mbps and 100 Mbps connections, if you're
curious, are restricted to 200 and 300 Gb per month, respectively, before
throttling.)

For now, however, connection throttling, while practical, is not expected to
be implemented yet - Deutsche Telekom is merely securing for itself the right
to do so.

When exactly the implementation will be introduced depends on how "traffic on
the internet grows and develops." "As of yet, it's been our expectation that
we won't introduce the limitation in a technical manner until 2016," said
Michael Hagspihl, Director of Marketing at Deutsche Telekom.

Once the throttle is actually implemented, customers should still be able to
purchase unlimited monthly transfer volume as an "add-on" option. But that
possibility is not set in stone. The use of IPTV (internet protocol
television), Telekom's VOIP communications, and the sharing of connections via
"WLAN To Go" will not count against the monthly traffic limit. Reason being,
according to Deutsche Telekom, that customers pay separately for these
services. Civil liberties activists and consumer advocates alike criticize
such practices as violations of net neutrality.

Deutsche Telekom justifies their move with the ever-growing volume of traffic,
which requires continuous development/expansion of their network. A nationwide
fiber-optic infrastructure for all of Germany would cost €80 Billion, Deutsche
Telekom says. And that's just for residential connections. But bottlenecks
develop on the backbone of the network, irrespective of whether DSL or fiber
is used on the "last mile." Internet connections with higher data rates would
only squeeze those bottlenecks even tighter.

------
rmoriz
This is the introduction of the end of net neutrality. It's only a matter of
time that Google, Facebook, Apple, Amazon have to pay directly to Deutsche
Telekom to exclude DT customer's traffic from the volume limits.

It's like a medieval toll road…

~~~
Udo
Indeed. Especially since they already leaked that certain VOIP offerings,
certain IP TV channels, and in general certain streaming providers would
exempt from volume restrictions. That means they'll monitor our traffic and
whenever we're connecting to a partner company, everything will be fine. The
bandwidth cap is only intended for, you know, the actual free internet.

~~~
klaustopher
They already do that in their mobile offerings. In certain plans, Spotify
traffic is excluded from the monthly traffic limit

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rayiner
Why should bandwidth be charged for on anything other than a per-gigabyte
basis, perhaps with congestion rates for peak hours?

~~~
wmf
Because almost all of the cost of the network does not depend on usage?

~~~
rayiner
So what? There is certainly a capital cost to building and maintaining the
network, which scales with the provisioned capacity. That fixed cost can be
apportioned on a per-GB basis.

It's not different than the electric grid. Power plants are pretty much binary
creatures--they're either on or off. Each incremental kWh doesn't really cost
any more once the plant is up and operating at design capacity, except to the
extent that sufficient extra kWh might necessitate more capacity and thus more
fixed costs.

~~~
lmickh
Those extra kilowatts can be sold to other areas. That is exactly what is
happening in most instances.

You can't sell the left over bandwidth of an infrastructure you provide to a
consumer.

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mschuster91
The real plan of the DTAG is something no one has thought of yet. Because this
will only affect new customers, the new customer-base will drop, if not vanish
entirely.

Now, the DTAG can complain at the BNetzA (regulatory body) that they don't get
new customers and that they can't maintain the infrastructure because of
missing money, and so can increase the amount they charge of resellers.

At the same time, though, they will lower their own pricing, so that they have
a _massive_ competitive advantage again.

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gphreak
If you look at their current conditions, for Call & Surf VDSL and fiber
contracts there is already a cap in place [1]. It is not enforced, though, but
certainly will be in the future. Entertain contracts on the other hand do not
mention this for VDSL, only fiber [2].

From my basic understanding they cannot change that, so I switched to
Entertain for the next two years. I currently costs the same as my old
contracts for 24 month.

[1] <http://www.telekom.de/dlp/agb/pdf/40569.pdf> [2]
<http://www.telekom.de/dlp/agb/pdf/40926.pdf>

~~~
klaustopher
IMHO throttling to 6Mbit/s is a lot different than throttling to 384kbit/s

~~~
gphreak
Agreed, but it still hurts. Also, the upload goes down from 10mbit to 0,5,
which is quite severe.

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transfire
Time to evolve those mesh networks!

~~~
jauer
Wireless mesh technology can't touch the capacity and latency profile of
traditional last-mile access networks even with bandwidth caps.

------
jpollock
This is charging per byte. They're implementing an amount of traffic bundled
with the base package, throttling when it's exceeded and the ability to
purchase additional full speed traffic blocks.

Charging per byte is a "good thing". It encourages carriers to go after the
top 1% of their bandwidth users. Otherwise, they treat them as a cost.

Even better, it places a lower bound on the value of a piece of media. Here in
NZ, I'm paying US$1.20/GB. That means that 720P torrent of Game of Thrones
would cost me US$1.70 to download. All of a sudden, people can compare
torrenting something with getting Sky (HBO provider).

Even better, if the total value is around the cost of traffic, it encourages
the provider to do a deal with the telco for cheap transit and revenue splits.
That typically results in better performance for the end customer - such as
Google's YouTube caches.

~~~
rallison
The problem with this is that the actual transit cost per GB never seems to
come close to what the ISPs charge. $1.20 per GB could very well be 100 times
what the ISP ends up paying to actually move the GB. The basic problem is that
the up-front infrastructure and maintenance costs are expensive, but the
transit is extremely cheap. So, unless the ISP charges a base minimum amount,
a heavy user just ends up heavily subsidizing the infrastructure and
maintenance costs of the light users.

Not to mention that charging by byte is a great way to stifle innovation on
the web. Basically, I would disagree with your assessment.

~~~
jpollock
Yes, you are correct about minimum account fees being required to avoid a
subsidy in the other direction (large->small). NZ packages typically work out
to about US$24 + $US1.20/GB, although the per GB price is dropping. We're
getting fiber in the next couple of years, and at least one ISP is already
offering TB/mo data bundles for US$144 (incl 100/50 fiber).

I don't see how it stifles innovation at all. It does stop a cross subsidy
from the ISP to the company attempting to implement a new, even higher, usage
service.

~~~
rallison
I appreciate the reply and further details on these NZ plans. Given the rather
high cost of $1.20/GB, I naively assumed that these plans did not actually
also have a minimum account fee. I would still contend that $1.20/GB is
ridiculously high for home broadband, barring special circumstances (remote
areas, cell network, etc).

As for stifling innovation, consider what the internet would look like if we
were all still on dial-up. Greater bandwidth continues to open up new
innovations; customers struggling with low bandwidth or expensive per GB
pricing schemes hinder that innovation.

~~~
jpollock
I can see that. I just look at the NZ market and see competition working. :)

You're right, $1.20 feels expensive and we all grumble about it. Even so, I
did some math and found out it was cheaper to stream video at $1.20/GB than it
was to pay for cable tv, so I cut the cable and upped my data bundle. :) It's
all relative.

I'd argue that it's only when there's a single monopoly provider does pricing
start to stifle innovation. The NZ ISP market is split into wholesale/retail,
with an unbundled local loop and a regulated wholesale price. ISPs can
purchase DSL connections from the wholesaler, or pay for access to the cabinet
to install their own equipment.

Even when NZ was analog they had innovation. The biggest one was the creation
of "Free" ISPs, where they lived off of the termination fees that they were
able to charge the originating carrier - much the same as free conference
calling and international long distance services out of Ohio. That lasted
about as long too. :)

NZ has tried unmetered service several times, with really bad results.
Throttling, low bandwidth, ugly. High traffic users would shift to the
unmetered plan and overwhelm the provisioning ratios. You ended up with a
service that only bulk users (low throughput, high volume) would want to use.

However, since unbundling (2006), we've had pretty vibrant retail ISP
competition, which goes through ebbs and flows of price competition. The shift
to fiber is currently causing lots of competition. :) We've got 3 mobile
carriers and 7 major ISPs. The ISPs all offer fixed phone service as well,
some on their own equipment, some from the wholesaler.

The carriers have learned that the market isn't going to pay extra for fiber,
but it is expecting more service and bundled data. Some are currently
grumbling about that, but their competitors are jumping on the treadmill so
everyone has to. We're starting to see fiber accounts with 1TB for US$115,
which is US$0.12c/GB, a much better price.

I look at my connection and I've got a 100/10 link, and I can pull 30-50mbps
of international traffic out of it during busy hour. I can get the full
100mbps to the ISP's servers - the local Steam mirror can be wicked fast. I
attribute this to the carrier perceiving me as a source of revenue to be
encouraged instead of a cost to be driven out.

