Cisco appears to be taking a page from the tobacco industry with its blog statement today: "The aim is to transform users' addiction to broadband into willingness to pay."
"One only has to look at the price of water to see that it is possible to implement strongly differentiated prices for a commodity product.
"The aim is to transform users' addiction to broadband into willingness to pay.
"Building premium value-based pricing plans will require:
"Technical characteristics - Important technical characteristics may include ultra-fast Internet access, turbo buttons, and guaranteed quality of service in terms of bandwidth and latency.
"Differentiated pricing - Differentiated pricing strategies may include time-of-day pricing, dynamic or spot pricing, broadband access bundles shared by multiple devices and/or people ('family plans'), or embedded connectivity."
Well, here are my 4 problems with Cisco's strategy:
I prefer to only drink tap water provided by my local government, so I've never had a need to consume premium bottled water!
I'm totally addicted to broadband, however, there are only 2 broadband providers offering broadband access to my favorite office, Verizon and Cablevision.
Plus in reality, I actually have only one broadband provider and that's Cablevision. Why? Because Verizon has proven to me that they are totally incompetent (view local, state and federal cable franchise regulation).
Since in reality, there actually is no broadband access competition today, broadband providers have now become "Natural Monopolies," and as such, transforming users' addiction to broadband into willingness to pay, is an abuse in my personal opinion.
