Coyote Blog

Readers of this blog know that I have always been skeptical of the value of net neutrality rules.   I see the Internet just like any other vertical value chain with multiple players, which we might oversimplify as content providers who hand off to bandwidth providers to get in front of the customer.  Nearly every industry has these vertical value chains with multiple players -- think Coke and Pepsi fighting for floor space and margins through Wal-Mart.  What is amazing to me is how the large content streamers, particularly Google, Netflix and Facebook, have somehow convinced the public that the whole future of the Internet depends on the government hamstringing the bandwidth providers in their relationship with the content producers.

When Youtube wants to stream at 4K rather than 1080p, the majority of the instractructure hit is on the bandwidth provides, and Google/Youtube wants that bandwidth to be there but does not want to have to pay for any of it.  That is why these companies are the main supporters of net neutrality, but they are smart enough not to say this, but to instead flog some mythology that bandwidth providers might block or discriminate against certain providers.  Even supporters of this meme are forced to agree that it is wholly hypothetical, that no one can really point to any good examples of it happening (I have always suspected that general public hatred for Comcast in particular has created more support for net neutrality than anything else).

This argument for net neutrality is even odder as clear discrimination and deplatforming is happening on the Internet apparently everywhere BUT with the bandwidth providers.  Or as I wrote on Twitter:

I might be unable to get a domain registered. I might not get hosted. I might not get anyone to handle my payments. I might not be able to syndicate on any social media. Google might not show me in searches. But by God Comcast is going to give equal treatment to my traffic!

— Coyoteblog (@Coyoteblog) November 29, 2018

This is my usual long-winded lead in for a very good article I read a while back and forgot to link.  It's from Drew Clark at Cato and is titled "Seeking Intervention Backfired on Silicon Valley".  I recommend the whole thing but here is a small piece:

The companies that drove the engine of America’s information technology machine essentially argued as follows: We provide the good stuff that you — the American consumer — want. You go to Google to get your searches answered. You want Facebook to keep up on posts from friends, families, and trusted content providers. Access to the content in the Apple iTunes store or to Amazon Prime streaming video subscriptions doesn’t need to be regulated because we tech giants compete vigorously among ourselves. But Washington does need to step in and regulate the telecom market because of a lack of competition among ISPs. And the FCC agreed in 2015 with what was officially dubbed the Open Internet Order. ...

Major content companies like Google, Facebook, and Netflix feared that ISPs would seek to throttle their services as a way of extracting payment for prioritization. Particularly for data-intensive video- streaming services like Netflix and Google’s YouTube, this concern had a certain economic logic, even as it remained hypothetical. Having long courted Silicon Valley as a key constituency and facing a highly visible public demand with enthusiastic grassroots support on the left, Obama complied....

Silicon Valley’s regulations-for-thee-but-not-for-me attitude has come back to bite them. They want the strictest form of regulation for telecommunications providers but no scrutiny of themselves, and now the tables have been turned.

Pai has not hesitated to point out the hypocrisy as he has moved to undo the net neutrality rules. In a November 29 speech in the lead-up to his net neutrality rollback, he said that the tech giants are “part of the problem” of viewpoint discrimination. “Indeed, despite all the talk about the fear that broadband providers could decide what internet content consumers can see, recent experience shows that so-called edge providers are in fact deciding what content they see. These providers routinely block or discriminate against content they don’t like.”

Cost-based pricing would say that digital media streamed to the home should always be less expensive than the same media delivered on physical disks in boxes delivered by UPS.

Value-based pricing says that someone with a Roku who wants to see a show right now, not two days from now, and doesn't have a DVD player and doesn't want to hassle with putting disks in and out to get through a whole season of a TV show might pay more for the digital delivery.

Sometimes cost-based pricing rules.  Sometimes value-based pricing dominates.  Sometimes pricing is weird due to temporary scarcity or gluts.  Sometimes pricing is inexplicable.  Which is this (click to enlarge):

Entire Season on physical DVD's with free Amazon Prime delivery:  $13.99

Entire Season streamed digitally:  $22.99

Since I like to buy the disks and then rip them to my video server at home running XBMC, I was happy to get the disks inexpensively.

I have been an Amazon Prime customer for years, and have been very satisfied to get the free two-day shipping.    And they have always done a good job with this, and in the past I have had literally hundreds of shipments in a row arrive on time.

However, two of my last three orders have been late, and the last order, which should have been here on Thursday, still, two days later, has not arrived despite the fact the system says it was delivered June 23 at 12:54.

But it is actually fairly easy to figure out why the service has deteriorated.  On both these late orders, Amazon used the USPS to deliver the package.  That explains a lot.  The USPS has awful, unreliable service and has absolutely no package tracking capability.  Not only is it my package missing, but neither Amazon, myself, or the USPS have any way to find out where it is.

This is awful service.  I am not only a pretty high-volume customer, but I have paid an annual fee to get premium shipping -- and I can tell you that there is likely no one on Earth who considers the USPS a premium shipping option.  If they keep sending my 2-day packages snail mail, there will no longer be any point to being a prime member.  Maybe they will offer a super-prime membership sometime in the future that guarantees they will not use USPS (though I suppose I can get this now by clicking the one-day shipping button and paying the $3 or whatever it is extra).

Up until the last month, I have been very happy with Amazon Prime, the service where you pay $80(?) for a year of free 2-day delivery.  I am sure I have ordered more stuff from Amazon because of it, and I know I order it faster because I don't wait weeks with things in the shopping cart to group shipments.   

However, in the last month, I have had not one but two orders show up in 7-8 days instead of two.  The first was a Batman Begins DVD, pre-ordered to ship on its release date (which it apparently did).  It was shipped USPS, so there was obviously no hope that it would arrive in 2 days.  The second was a new Nikon D50, which was back-ordered for about a week.

I never really got an explanation for the DVD shipment (maybe they don't apply Amazon Prime to pre-orders?), but I did get some explanation for the Nikon D50.  After writing Amazon, asking them why my item shipped UPS Ground with a 7-8 day delivery time instead of 2-day, which I had paid for with Amazon Prime and was listed as the shipment method on the order page, I got this response  (greetings, apologies, etc. omitted):

After your order leaves our fulfillment center, we may use any
appropriate ground or air shipping service necessary to ensure that
your order is delivered within one or two days, depending on the
delivery option you selected.  These delivery options do not
directly correspond to any carrier-branded shipping services.

I have researched the order in question, and it appears your package
will arrive on time.

We understand that customers who select Two-Day or One-Day delivery
want to receive their orders faster, and we will only use an
alternative shipping method when we know your order will arrive by
the estimated delivery date. 

This is obviously not very clear, but here is what I infer:  When the item was back-ordered, they gave me an updated delivery date range, something like "estimated delivery Nov 2-10".  What I infer from this email is that once they give you an estimated delivery date range, they feel like their obligation to ship 2-day is voided.  The only obligation they now feel they have is to hit that date range.  So, despite the fact that my camera shipped on Nov 2 and I paid for 2-day shipping, they feel they are meeting their obligations if it gets to me by Nov 10, the back end of their estimated range.

The conclusion is not to feel sorry for me that I have to wait to play with my new toy, but that this may be the first sign of a program that is being gutted under profit pressure.  When lawyers looking for loopholes take over the customer service and fulfillment department, things can go downhill pretty quickly.  Note that the "est. delivery date" dodge really gives them carte blanche to get out of the 2-day obligation any time they want, since they set the estimates. 

As a note, I tried to confirm my interpretation with Amazon and have been unsuccessful.  In the tradition of making itself one of the hardest companies in America to actually contact, one can't reply to their customer service email so I can't get an easy confirmation or clarification.  I actually got and called their customer service phone number, which you will never find on their site (write this down:  1-800-201-7575).  The person on the other end of the line was useless, not understanding that I wanted a clarification of the Amazon Prime rules rather than some resolution of a particular order.  She couldn't access the emails I had sent to customer service or had received from them, and didn't seem to understand Amazon Prime rules, so she was no help.  The only funny part was that as I kept trying to clarify what I wanted from her, she kept upping the gift certificate amount she offered me as compensation, despite the fact that I kept saying "I don't want money I want to know what the rules are".  I think I ended up with $20 without even wanting it.

Which makes me wonder why I can't reply to Amazon's customer service emails.  I don't have a problem getting customer support via email rather than the phone, but to make this work I really need to keep working through to resolution with the same person, and the Amazon process makes this impossible.