Mr Engineer, What you say is true, but doesn't quite complete the picture. In the good old days, near enough was good enough with a captive market in telecoms. But things are getting competitive. It won't be economic to simply dump out more cells when the previous ones haven't been milked to the last drop [using a cow analogy popular here in New Zealand which is NOT all sheep]. While it is true that spectrum is a long way short of used up and there is serious commentary to the effect that it never will be used up, the shortage I'm referring to is of infrastructure and the resulting shrinking cdmaOne cells. But whatever the resource shortage - power supply in satellites, spectrum, basestation wiring or handset battery life, it can best be rationed by instantaneous subscriber pricing rather than broad brush, inaccurate and expensive general price plans which are used now to try to spread load.
If the companies do what you are saying, they will always have to have a big surplus of capacity to avoid busy signals at peak times, even though cells can load share by passing peripheral subscribers off to neighboring cells. They will have to put smaller and smaller cells in earlier than they would need to if they charged the service out at market rates as defined instantaneously by subscriber demand. Infrastructure costs so subscribers would always have to pay more for an overbuilt system than one optimized by subscriber priced networks which would shift demand onto less busy times by peak pricing at whatever subscribers bid to be able to make a call NOW!
Tightwads like me would put off a gossipy chat if they saw $10 per minute during a sudden 5 min demand peak when the baseball scores are being announced and all the chewing gum crowd are phoning each other to compare scores.
Here's a verbal description of the algorithm needed. Basestation gets busy. Says to self, "Man I'll get it in the neck if I run out of space for the next caller to make a call. I'm now running at 80% capacity, the neighboring cells are at 85% and can't take too many of my calls. I better put the price up a bit more to slow demand [and make a bit more money, which the boss likes]." So he shoves the price up from $0.15 to $0.17 per minute. But "Babe" Ruth [I'm unfamiliar with recent baseball players names other than Mike Tyson and I think he's back in jail] has just hit a home run and people are chewing flat out and getting on their Q-phones from Qualcomm stadium to spread the news. Suddenly demand hits 90%! Basestation "Babe!" as a handy non-sexist name panics and rams the price up to $0.34 per minute to try to stem the flood of excitement and maintain space for more callers.
Damn it all! It doesn't dent demand so "Babe!" pushes the price up to $0.93 cents per minute as he hits 94% capacity. Outside the stadium, Ramsey was about to check out some more babes on his "Anita" web phone while waiting at a red light. Sees $0.93 per minute and decides he better wait till whatever it has caused the panic subsides as his wife is getting a bit antsy about the high phone bills he's been getting since he got the latest Q-webphone. Business calls shouldn't cost so much she thinks.
Babe takes off from the plate but his trousers get caught on the horns of a bull "as seen on tv" which they've taken to letting loose during games for a bit more fun and his trousers end up on the bull's horns and he has to run for the dugout. The crowd goes wild. They start phoning home even though "Babe!" is showing $24.80 per minute in a desperate attempt to stop demand hitting 99%.
Pretty soon though, as prices hit $44.95 a few are dissuaded from calling and demand drops off. People keep their calls to a brief "You wouldn't believe it, I'm down at Qualcomm stadium and there's a Babe running round with no pants on!!!" People sitting in their cars at red lights are staring at their handsets in amazement, watching the "CURRENT PRICE IS $44.95 per minute" sign flashing at them. They put off calling home for a chat!
As the excitement dwindles, "Babe" starts cutting prices. Over the next hour or so, "Babe" has hardly got anything to do. The rush hour is over, the crowds are smiling their way out of Qualcomm Stadium, now nicknamed "Babe's Place". So "Babe" cuts prices down to $0.05 to try to generate some interest. Sure enough, Ramsey, still in a traffic jam, fires up "Anita" to check out some Babes. Does a web search to find some new ones. Gets Qualcomm stadium and Qualcomm "Babe!" profit centre results announcing huge profits due to the new subscriber auction system of demand smoothing. Pretty happy at that, he calls in and buys his wife some flowers....
All is well with the world....the cells around Qualcomm stadium didn't shrink too badly, nobody got cut off, everyone who wanted to could make a call, profits are immense, Ramsey gets Babe connections at $0.05 per minute, the local service provider figures they better put in more capacity as competitors are becoming aware of the money to be made when "Babe" is on the horns of a dilemma.
Mqurice
PS: Ramsey, you said: "..always figure you to be a Babwatch type of guy, didn't realize you follow Beverly Hills 90210 instead. Do you New Zealanders even know where Beverly Hills is?"
Okay, so I can't spell Beverly Hills, but we DO have "Babewatch" here - I've seen it in the tv listings but not being interested in baseball, I've never watched it. Anyway, why would you think I'm a babe kind of guy? That sounds prejudicial to me! I have to admit to having driven around Beverly Hills though, but I didn't see babes as seen on tv in Beverly Hills 90210. Mostly tourists of quesionable physique. |
