Greetings, fellow old-world primates.
Today I'm going to flesh out an idea a dear friend of mine had: that waste heat from high-performance computer facilities could be used to heat cold regions of the world.
We humans evolved our big brains in Africa, where it's nice and warm. For better or for worse, these big brains have allowed us to develop means of keeping our bodies at African temperatures even at polar latitudes, allowing us to conquer the planet.
Technology (be it fire or clothing) has always been a factor in allowing our spread into frozen zones; today I'm going to look into something a little higher-end.
Computing in Vegas
A friend of mine works for Cafe Press, an online clothing-designing company which recently moved their main data centers to Nevada. The reason for this move was an unusual one: proximity to the Hoover Dam means cheap power to run the site's computational muscle.
In fact, data centers can generate an enormous amount of heat. A thousand processors working at 100 W each consume 100 kW of electricity: about 50 households' worth. With electricity costing 15¢ per kWh, that's over $130 000 per year in electricity costs alone, and that's before factoring in cooling costs.
Computing in Siberia
Suppose instead that data centers were built where you want to generate a lot of heat anyway. that same 100 kW data center could potentially provide heat most of the required heat to a shopping mall. How economically feasible is this? Let's look into two possible scenarios. For the sake of simplicity I'm going to assume enough people will soon do the Cafe Press trick that electricity costs even out globally around 15¢/kWh.
Scenario A: 1 fixed data center in a place cold in winters.
Here, you'd build a 1000-CPU data center for $500 000, and half of the year you'd be able to use 80% of the waste heat from the data center to heat a mall. Together, you and the mall would save $52 560 in heating costs per year of operation; more if you can use some waste heat more than half the year. Even in the summer, data centers could be used to provide hot water.
Scenario B: 1 data center in a shipping container, moving from pole to pole
Sun Microsystems' "Project Blackbox" will build you a data center in a shipping container already. Imagine having a deal with two different malls, one in each hemisphere, so that the waste heat of the data center could be used always. You'd have two extra expenses: container shipping expenses (about $10 000 for the round trip) and four weeks annually of down-time, but you'd save $100 000 in heating costs. Overall, you'd have to spend 8% more (or $40 000 as a one-time expense) on your computer hardware to compensate for the downtime, but that should be just-about recouped after the first year of operation.
Three Moore's Laws
Technologically, the use of waste heat is only going to make more sense in the future. There are three relevant Moore's laws here: performance/watt, performance/$ and bandwidth/$.
The most familiar Moore's law statement is that computing power doubles every 18-24 months, but one should also look at power efficiency and bandwidth trends. Power efficiency has been climbing slower than computing efficiency, so today's $1500 PC uses more energy than a $1500 PC from a decade ago. Conversely, bandwidths have been doubling more frequently than CPU speeds. Therefore, in the future, bandwidth (especially on the backbone of the Internet) will be too cheap to matter, and the ratio of power expenditure to computer hardware expenditure is only going to increase.
Therefore re-using computer waste heat is only going to become increasingly lucrative in the future, so it's a technology that should be on the up-and-up.
Conclusions
It's already cheaper to operate data centers where power is cheap. I think now it's also cheaper to coöperate with public buildings (which tend to be big enough to act as thermal flywheels to smooth out diurnal heat supply needs) to supply waste heat from data centers. I haven't worked in the added costs of the data center's floorspace, so it's not yet a complete no-brainer to use computers instead of /along side of traditional furnaces, but future trends certainly seem to be pointing in that direction.
Yoursfor a Greener Cyberspace,
LeDopore
PS This post printed with 100% recycled electrons
Friday, August 31, 2007
Monday, August 27, 2007
How Much do You Pay Your Machines?
Greetings, Robot Lords.
The Pitch
How much do you value your free time? In Stephen King's The Stand, the Walkin' Dude comes by Mother Abigail's place in the guise of a vacuum cleaner salesman, making the pitch that he's not actually selling her labor-saving vacuum cleaners. Instead, he's selling her cool lemonade sipped in the shade on a hot day, time to lazily read a novel, or time to do essentially whatever Mother Abigail likes best. The premise is simple and appealing: we buy (or make) machines which save us drudgery, and then allegedly have more free time.
The Catch
In reality, our time-savers often end up owning us instead. It takes a lot of time, energy and money to maintain every piece of equipment we buy. On the other hand, I have a lot more free time than any subsistence farmer I've heard about, so there must be a good side to this tech too. How do we know if a given piece of labor-saving tech is worthwhile?
The Players' Salaries
One interesting analysis is to figure out what effective wage you're paying your labor saving device for your extra free time. Everything doesn't always boil down to money: it's not as if chores are equally onerous (I enjoy gardening more than cleaning the bathroom), but quantifying the hourly rate of free-time-saving makes for an interesting analysis nonetheless. Here's a summary table, then I'm going to talk a little more about some entries. Here "machine wage" isn't how much you pay per hour of operation - it's how much you pay per every hour of labor it saves you. I've ordered this list in descending order of utility.
On that note, let me hand it over to you. The numbers I've presented are highly personalized and might not apply to you. I do a lot of serious computing, and even for me a new computer only barely makes sense. I live close to work, so biking is a great option. We do a lot of entertaining, and thus a dishwasher is pretty much essential. If you truly need a car, or if you don't entertain or run scientific computing experiments your personal table is likely to be quite different. Still, I encourage you to do the same sorts of analyses before listenening to the Walkin' Dude.
Rule your 'bots with an iron fist!
LeDopore
The Pitch
How much do you value your free time? In Stephen King's The Stand, the Walkin' Dude comes by Mother Abigail's place in the guise of a vacuum cleaner salesman, making the pitch that he's not actually selling her labor-saving vacuum cleaners. Instead, he's selling her cool lemonade sipped in the shade on a hot day, time to lazily read a novel, or time to do essentially whatever Mother Abigail likes best. The premise is simple and appealing: we buy (or make) machines which save us drudgery, and then allegedly have more free time.
The Catch
In reality, our time-savers often end up owning us instead. It takes a lot of time, energy and money to maintain every piece of equipment we buy. On the other hand, I have a lot more free time than any subsistence farmer I've heard about, so there must be a good side to this tech too. How do we know if a given piece of labor-saving tech is worthwhile?
The Players' Salaries
One interesting analysis is to figure out what effective wage you're paying your labor saving device for your extra free time. Everything doesn't always boil down to money: it's not as if chores are equally onerous (I enjoy gardening more than cleaning the bathroom), but quantifying the hourly rate of free-time-saving makes for an interesting analysis nonetheless. Here's a summary table, then I'm going to talk a little more about some entries. Here "machine wage" isn't how much you pay per hour of operation - it's how much you pay per every hour of labor it saves you. I've ordered this list in descending order of utility.
| Item | Price | Cost/y | Lifetime (y) | Hours saved/week | Hours saved | Total Cost | Machine Wage |
| Dishwasher | 500 | 5 | 3 | 780 | 500 | 0.64 | |
| Non-stick fry pan | 100 | 20 | 0.05 | 52 | 100 | 1.92 | |
| Lawnmower (electric) | 400 | 1 | 10 | 0.25 | 130 | 410 | 3.15 |
| Newer computer | 1500 | 2 | 1 | 104 | 1500 | 14.42 | |
| Kitchen Mixer | 200 | 1 | 20 | 0.0096 | 10 | 220 | 22 |
| Melon baller | 10 | 10 | 0.00064 | 0.33 | 10 | 30 | |
| Car | 5000 | 2000 | 5 | 1 | 260 | 15000 | 57.69 |
- I'm a dishwasher evangelist. I've been responsible for (or at least influential in) the decisions of no fewer than 5 households I know to acquire a dishwasher by hook or by crook. (If you're renting, look into portable dishwashers - that's what I own.) Until today I just always had a hunch that dishwashers were good time-savers, but the hard numbers really nail it for me. Operating a dishwasher (in hot water and dish soap) costs about the same as washing by hand, and by my analysis my $500 dishwasher will save me 780 hours of scrubbing. Since I value my free time more than 64¢/hour, owning a dishwasher is a no-brainer.
- I just bought a $100 super-high-quality frying pan, with (I kid you not) embedded diamonds as the non-stick coating. So far I have no complaints performance-wise: I get an even heat and the food has been scrumptious every time. As a side effect, I estimate that I spend about 3 minutes per week less cleaning, since now I can use this pan instead of my older stainless steel pan (which was a pain to scrub). Those 3 minutes per week over the 20 years the pan should last amount to 52 total hours saved, so I'm "paying" this machine $1.92/hour for the privilege of not washing dishes.
- If I were to buy a new computer (something I dream about way too often) I might spend about 1 hour less per week waiting for my numbers to crunch (I'm a "power user": I run intensive numerical operations on a regular basis; for word-processing I doubt a newer computer would save more than a minute or two per week). If the new computer I'd keep for about 2 years, then it would save me about 104 total hours, so upgrading now (for $1500) would be like paying the machine $14.42 for every hour I save not waiting for that progress bar to end.
- I broke down and bought one of those designer kitchen mix machines the other year. We barely use it, truth be told. If it were to save 15 minutes twice a year, this $200 machine would save us 10 hours of work over its 20-year lifetime. (Inside, I doubt it will save that much time, but the truth hurts sometimes.) It really sucks power too, so I guess its lifetime cost (price + power) will be $220; meaning we're paying it $22 per hour that it saves us. (Note: this mixer brings an invaluable quantity of ancillary joy to my better half merely by gracing our kitchen - which is precisely why this kind of analysis didn't have the last word.)
- We also own a melon baller! If it saves us 2 minutes a year (we hardly use it), we're paying it $30/hour for the privilege. Maybe single-purpose kitchen gadgets should be contraband.
- Last (but not least) we don't own a car. I can get to and from work without one (and, considering the parking around where I work, biking is faster), even though it makes doing errands a little more tricky. I estimate I spend about 1 hour more per week doing errands because I can't just hop into a rust bucket. (Aside: if I were to offset time I don't have to spend in the gym because I bike, this 1-hour figure could very well be negative!) In any case, were I to buy a car, over 5 years it could well cost $15,000 in insurance, depreciation, maintenance, parking and fuel. For each of the 260 hours it would save me, I'd be paying it $57.69: a pretty lousy deal. I guess I won't be buying a car until my lifestyle requires one.
On that note, let me hand it over to you. The numbers I've presented are highly personalized and might not apply to you. I do a lot of serious computing, and even for me a new computer only barely makes sense. I live close to work, so biking is a great option. We do a lot of entertaining, and thus a dishwasher is pretty much essential. If you truly need a car, or if you don't entertain or run scientific computing experiments your personal table is likely to be quite different. Still, I encourage you to do the same sorts of analyses before listenening to the Walkin' Dude.
Rule your 'bots with an iron fist!
LeDopore
Labels:
21st century capitalism,
economics,
health,
luxury,
philosophy,
technology,
wages
Sunday, August 19, 2007
Middle Ground Meat?
Greetings, omnivores.
Today I'm going to talk a little about animal welfare, and how we might improve it without getting angry at anyone.
Lately some animal rights protesters have been harassing someone close to me (I'm not going to go into details), and it started me thinking about ways in which animal rights activists might improve animal welfare most effectively. I think there are two main inefficiencies with current animal rights activity: extremism and lack of perspective.
Problem 1: Animal Rights Activists Tend to be Extremists
"You catch more flies with honey than you do with vinegar...*"
There are three general stances you could take on animal welfare:
Even if you do believe murder is justified in a few circumstances, it's bad PR to kill your enemies. Homicide undermines your soft power like nothing else. I bet the above bombing did more to inoculate potential animal rights supporters than the combined forces of all the starched-shirted science-defending geeks ever to mumble through a justification of animal use at every cocktail party the world has seen.
Problem 2: Animal Rights Groups Lack Perspective
There are over 250 million egg-laying hens in the United States: almost one per human. There are likewise millions of dairy cows and livestock pigs. Many of these animals suffer for the sake of thrift: it's cheapest to pack animals into the smallest space that won't kill them.
Still, the three biggest animal rights causes I hear about are fur, pâté de foie gras, and medical research. A more quantitative statement: a Google search for "fur activism" turns up more hits than "laying activism."
What do fur, foie gras and medical research have in common? Not everybody comes home from their day quantifying drug toxicity to grab their mink stole on their way to a nice bistro: animal rights activists figure they can win more sympathy from people to counter less-common animal uses. They even turn poverty into a virtue: most of us can't afford blue fox coats while we're starting out, but PETA would have us believe we haven't yet bought fur because we instinctively know it's wrong. Moreover, a lot of rich people feel guilty about being rich (I can treat the root of this problem, incidentally. Please leave your contact info below.), making it easier to attack the morals of self-doubting millionaires.
In short, animal rights groups attack fringe animal usage since these are the issues they think they can "win." If I were them, and if I were really interested in animal welfare, I would recognize that many of us want to reduce animal suffering and would pay to do so (at least a little), so what we really need to do is have animal rights organizations set up a scoring system for farm animal welfare.
A lot of people would pay 20¢ more for eggs from hens which suffered 50% less pain. However, we have no way of really knowing how good each farm is. The time has past (or hasn't yet come) to paint each farmer Joe as a miniature Hitler: what I'd like to see are livestock comfort ratings on beef, milk, pork, chicken and eggs. Make them fair and standardized, and just watch if you don't find a significant minority of consumers support farms that would improve the lives of tens of millions of our fellow creatures.
Conclusions
Polarizing the debate on animal usage is a losing strategy: too many of us won't give up using animals in some form. Many animal activists use terrorist tactics to intimidate minority animal users. Regardless of whether you think animal rights should be equivalent to human rights, it's a better strategy to use market forces to relieve some suffering from mainstream animal uses; that's the easiest way to reduce animal suffering overall.
Chomping tenderly,
LeDopore
Reader poll: Who's a vegetarian, and why? How much extra would you spend on your daily food knowing your meat animals suffered less? How many of you would like the taste of happy meat better, if only through the placebo effect? Please leave me comments.
* Maybe animal rights activists think of the stuck fly's suffering, and so use vinegar deliberately to warn them from the trap?
Today I'm going to talk a little about animal welfare, and how we might improve it without getting angry at anyone.
Lately some animal rights protesters have been harassing someone close to me (I'm not going to go into details), and it started me thinking about ways in which animal rights activists might improve animal welfare most effectively. I think there are two main inefficiencies with current animal rights activity: extremism and lack of perspective.
Problem 1: Animal Rights Activists Tend to be Extremists
"You catch more flies with honey than you do with vinegar...*"
There are three general stances you could take on animal welfare:
- Animals suffering is equivalent to human suffering, so feed lots are equivalent to the WWII concentration camps (reflected in some ad campaigns).
- Animals are cute but tasty: let's try to make them reasonably happy as long as we can still eat bacon.
- Animals are here for human use. Some animals (mosquitoes come to mind) use us without the slightest regard for our well-being, so to hell with our looking after them.
Even if you do believe murder is justified in a few circumstances, it's bad PR to kill your enemies. Homicide undermines your soft power like nothing else. I bet the above bombing did more to inoculate potential animal rights supporters than the combined forces of all the starched-shirted science-defending geeks ever to mumble through a justification of animal use at every cocktail party the world has seen.
Problem 2: Animal Rights Groups Lack Perspective
There are over 250 million egg-laying hens in the United States: almost one per human. There are likewise millions of dairy cows and livestock pigs. Many of these animals suffer for the sake of thrift: it's cheapest to pack animals into the smallest space that won't kill them.
Still, the three biggest animal rights causes I hear about are fur, pâté de foie gras, and medical research. A more quantitative statement: a Google search for "fur activism" turns up more hits than "laying activism."
What do fur, foie gras and medical research have in common? Not everybody comes home from their day quantifying drug toxicity to grab their mink stole on their way to a nice bistro: animal rights activists figure they can win more sympathy from people to counter less-common animal uses. They even turn poverty into a virtue: most of us can't afford blue fox coats while we're starting out, but PETA would have us believe we haven't yet bought fur because we instinctively know it's wrong. Moreover, a lot of rich people feel guilty about being rich (I can treat the root of this problem, incidentally. Please leave your contact info below.), making it easier to attack the morals of self-doubting millionaires.
In short, animal rights groups attack fringe animal usage since these are the issues they think they can "win." If I were them, and if I were really interested in animal welfare, I would recognize that many of us want to reduce animal suffering and would pay to do so (at least a little), so what we really need to do is have animal rights organizations set up a scoring system for farm animal welfare.
A lot of people would pay 20¢ more for eggs from hens which suffered 50% less pain. However, we have no way of really knowing how good each farm is. The time has past (or hasn't yet come) to paint each farmer Joe as a miniature Hitler: what I'd like to see are livestock comfort ratings on beef, milk, pork, chicken and eggs. Make them fair and standardized, and just watch if you don't find a significant minority of consumers support farms that would improve the lives of tens of millions of our fellow creatures.
Conclusions
Polarizing the debate on animal usage is a losing strategy: too many of us won't give up using animals in some form. Many animal activists use terrorist tactics to intimidate minority animal users. Regardless of whether you think animal rights should be equivalent to human rights, it's a better strategy to use market forces to relieve some suffering from mainstream animal uses; that's the easiest way to reduce animal suffering overall.
Chomping tenderly,
LeDopore
Reader poll: Who's a vegetarian, and why? How much extra would you spend on your daily food knowing your meat animals suffered less? How many of you would like the taste of happy meat better, if only through the placebo effect? Please leave me comments.
* Maybe animal rights activists think of the stuck fly's suffering, and so use vinegar deliberately to warn them from the trap?
Labels:
corporations,
ethics,
food,
government,
health,
philosophy
Tuesday, July 24, 2007
"-", not "/": In Search of Luxury on the Cheap
Greetings, lotus eaters.
It's been a long time since I've done a post! Let's start this one with some raw data.
Today's post is about how to achieve luxury on the cheap. Some people would approach this subject by talking about secret bargain-hunting techniques: how to obtain the latest and greatest without paying through the nose. However, an often ignored avenue to getting a taste of the "good" life is to spend the money where it counts the most. Something that's worked for me is to start using more of the "-" sign on my mental calculator and less of the "/" sign. Let me give an example to explain what I mean.
Eggsample
Let's talk egg selection. My local supermarkets sell eggs for as little as 79¢ a dozen. These eggs are of decent quality in that they're not risky to your health but, since they're made with such narrow profit margins, every choice the farmer makes has to maximize quantity, not quality.
In the same supermarkets it's possible to buy artisanal eggs for about $5 a dozen. Nestled in post-consumer-recycled cardboard carton packaging on which is printed (in natural, organically-farmed vegetable-based dyes) idyllic odes to the chicken pastoral ideal, these poultry-gems might not quite live up to their billing. However, in this humble blogger's opinion a free range egg is a cut above a factory-farmed egg.
Where Classical Economics Fail
The consumer is left with the following dilemma: should she buy eggs which are six times as expensive, even if they taste better? In an ECON 101 class, the critical question would be "do I enjoy the expensive eggs six times as much?". Since I'd derive less than six times the pleasure from a free-range egg meal than from a factory farmed meal, classical economics says that my utility-to-cost ratio is higher for the cheap eggs, so I should buy those. Many shoppers I see have an ECON 101 attitude as well: they eschew the good eggs because they cost a whopping 6 times as much as utility-grade eggs.
Classical economics however fails as soon as one realizes demand for breakfast is woefully inelastic. In fact, my demand for eggs is met after spending such a minuscule fraction of my capital acquiring them that neglecting the inelasticity of my appetite is absurd. Assuming you have about 2 eggs per serving, the extra cost of having free-range eggs is only 70¢. Is it worth a 70¢ premium to have superior-quality eggs? Absolutely! And yet in the supermarkets I see shoppers clamoring for the best bargain eggs. Why are people being so cheap?
Using the "-" Sign
The root of the problem is the division operator. People balk at the idea of spending six times more, while their finances are affected not by this multiplicative factor but by the arithmetic difference between prices.
From the table at the start of this post, you can see that while the relative price differences between the cheap and expensive items tends to be about 6, the arithmetic differences vary wildly. The premium on buying high quality eggs is two orders of magnitude less than the premium on driving a sports car on a daily basis. Are you willing, therefore, to sacrifice about 100 free range egg-level luxuries each day for the privilege of driving a sports car? If not, you should follow my lead: splurge on the cheap stuff and skimp on the expensive stuff.
Enjoy the good life!
LeDopore
It's been a long time since I've done a post! Let's start this one with some raw data.
| Item | Egg | Chocolate | Cheese | Wine | Car /day |
| Cheap Price/Serving ($) | .15 | 1 | 1 | 3 | 10 |
| Expensive Price/Serving ($) | .85 | 5 | 7 | 20 | 60 |
Today's post is about how to achieve luxury on the cheap. Some people would approach this subject by talking about secret bargain-hunting techniques: how to obtain the latest and greatest without paying through the nose. However, an often ignored avenue to getting a taste of the "good" life is to spend the money where it counts the most. Something that's worked for me is to start using more of the "-" sign on my mental calculator and less of the "/" sign. Let me give an example to explain what I mean.
Eggsample
Let's talk egg selection. My local supermarkets sell eggs for as little as 79¢ a dozen. These eggs are of decent quality in that they're not risky to your health but, since they're made with such narrow profit margins, every choice the farmer makes has to maximize quantity, not quality.
In the same supermarkets it's possible to buy artisanal eggs for about $5 a dozen. Nestled in post-consumer-recycled cardboard carton packaging on which is printed (in natural, organically-farmed vegetable-based dyes) idyllic odes to the chicken pastoral ideal, these poultry-gems might not quite live up to their billing. However, in this humble blogger's opinion a free range egg is a cut above a factory-farmed egg.
Where Classical Economics Fail
The consumer is left with the following dilemma: should she buy eggs which are six times as expensive, even if they taste better? In an ECON 101 class, the critical question would be "do I enjoy the expensive eggs six times as much?". Since I'd derive less than six times the pleasure from a free-range egg meal than from a factory farmed meal, classical economics says that my utility-to-cost ratio is higher for the cheap eggs, so I should buy those. Many shoppers I see have an ECON 101 attitude as well: they eschew the good eggs because they cost a whopping 6 times as much as utility-grade eggs.
Classical economics however fails as soon as one realizes demand for breakfast is woefully inelastic. In fact, my demand for eggs is met after spending such a minuscule fraction of my capital acquiring them that neglecting the inelasticity of my appetite is absurd. Assuming you have about 2 eggs per serving, the extra cost of having free-range eggs is only 70¢. Is it worth a 70¢ premium to have superior-quality eggs? Absolutely! And yet in the supermarkets I see shoppers clamoring for the best bargain eggs. Why are people being so cheap?
Using the "-" Sign
The root of the problem is the division operator. People balk at the idea of spending six times more, while their finances are affected not by this multiplicative factor but by the arithmetic difference between prices.
From the table at the start of this post, you can see that while the relative price differences between the cheap and expensive items tends to be about 6, the arithmetic differences vary wildly. The premium on buying high quality eggs is two orders of magnitude less than the premium on driving a sports car on a daily basis. Are you willing, therefore, to sacrifice about 100 free range egg-level luxuries each day for the privilege of driving a sports car? If not, you should follow my lead: splurge on the cheap stuff and skimp on the expensive stuff.
Enjoy the good life!
LeDopore
Tuesday, May 22, 2007
Hiatus
Greetings, California Dreamers
I thought I'd let you know that I'm going to be on a trip for the next few weeks. Many Ideas is going to go dormant until mid July, so tune in then when I'll have a new slab of quirky considerations for your surfing pleasure.
Sincerely,
LeDopore
PS If you come up with any more brilliant ideas for posts (the best ones seem to be user-submitted), please leave them in a comment here.
I thought I'd let you know that I'm going to be on a trip for the next few weeks. Many Ideas is going to go dormant until mid July, so tune in then when I'll have a new slab of quirky considerations for your surfing pleasure.
Sincerely,
LeDopore
PS If you come up with any more brilliant ideas for posts (the best ones seem to be user-submitted), please leave them in a comment here.
Friday, May 11, 2007
Liberty and Bandwidth for All
Greetings, YouTubers*.
In my last post I outlined how our current system of private Internet Service Providers (ISPs) companies is economically wasteful. Although in general the private sector is better than the public sector at providing higher-quality services at a lower cost, with ISPs the product (Internet bandwidth) is a factor of 1000 times cheaper than what ISPs charge. Almost all the ISPs' operational costs come from advertising, distributing and charging for this cheap-as-dirt Internet backbone bandwidth. In other words IPSs are intrinsically so wasteful that publicly-owned networks make sense. This post is going to tackle how I think we should implement municipal data networks.
Letting Demand Drive Expansion
Internet technology changes so fast that it would be unwieldy for a council to try to have a sane policy of technology roll-out which took advantage of the latest and greatest. It would also be hard to periodically gauge the service levels residents truly want. It's much better to make technology policy future-proof, meaning that no new laws or regulations will be required to implement better technology where it's wanted as soon as it's developed.
Here's an example of a future-proof network-building scheme. Have residents pledge (with holds on their credit cards) that they would be willing to pay X dollars for Y service. As soon as a private company notices that enough residents in a neighborhood have pledged enough money to make granting the service worthwhile, they can install whatever hardware they choose which is able to meet or exceed the bandwidth demands Y of all the people who pledged X dollars. The money from the credit card holds would then go into a trust which would pay the hardware companies annuities for as long as the service works (or maybe the trust should be invested with low risk, and 25% of the total equity should be paid to the hardware builder/maintainer each year; since Internet technology becomes obsolescent so much faster than roads it makes sense to make the payment schedule accelerated).
The city would provide all of the (essentially free) backbone bandwidth in exchange for the fact that all Internet services using that bandwidth must be broadcast over authentication-free wireless Internet or users must be able to plug in wired connections for free in publicly-accessible points. (Perhaps encryption could be optional to prevent people from spying, but it shouldn't be mandatory, and passwords must not be secret. With good crypto you can have every user use a different session key, so that even if they know each others' passwords they can't snoop on each other.)
Miscellaneous Points
Here are a few guidelines for details of the policy which might help:
In the Chicago example of last post we saw that the entire city could have a free data network for a one-time cost of under $15 per person. People are probably willing to pay a lot more for much faster connections; the plan outlined in this post shows a way in which a publicly-owned network can deliver services the public wants as soon as their feasible to deliver without wasting money on advertising and accounting.
This plan isn't anti-business either. The local companies which would spring up to supply the network services asked for by the people would have a leg up spreading to other municipalities where this same incentive policy gets implemented. (I am fairly confident that other municipalities would want to emulate the digital utopias which would come from this type of municipal Internet service.)
With some organization, the people can have cake and eat it too: they can pay a pittance in extra tax in exchange for hassle-free, state-of-the-art Internet connectivity. Everybody wins except old-school ISP shareholders. (Sell!)
*Web 2.0 couch potatoes?
In my last post I outlined how our current system of private Internet Service Providers (ISPs) companies is economically wasteful. Although in general the private sector is better than the public sector at providing higher-quality services at a lower cost, with ISPs the product (Internet bandwidth) is a factor of 1000 times cheaper than what ISPs charge. Almost all the ISPs' operational costs come from advertising, distributing and charging for this cheap-as-dirt Internet backbone bandwidth. In other words IPSs are intrinsically so wasteful that publicly-owned networks make sense. This post is going to tackle how I think we should implement municipal data networks.
Letting Demand Drive Expansion
Internet technology changes so fast that it would be unwieldy for a council to try to have a sane policy of technology roll-out which took advantage of the latest and greatest. It would also be hard to periodically gauge the service levels residents truly want. It's much better to make technology policy future-proof, meaning that no new laws or regulations will be required to implement better technology where it's wanted as soon as it's developed.
Here's an example of a future-proof network-building scheme. Have residents pledge (with holds on their credit cards) that they would be willing to pay X dollars for Y service. As soon as a private company notices that enough residents in a neighborhood have pledged enough money to make granting the service worthwhile, they can install whatever hardware they choose which is able to meet or exceed the bandwidth demands Y of all the people who pledged X dollars. The money from the credit card holds would then go into a trust which would pay the hardware companies annuities for as long as the service works (or maybe the trust should be invested with low risk, and 25% of the total equity should be paid to the hardware builder/maintainer each year; since Internet technology becomes obsolescent so much faster than roads it makes sense to make the payment schedule accelerated).
The city would provide all of the (essentially free) backbone bandwidth in exchange for the fact that all Internet services using that bandwidth must be broadcast over authentication-free wireless Internet or users must be able to plug in wired connections for free in publicly-accessible points. (Perhaps encryption could be optional to prevent people from spying, but it shouldn't be mandatory, and passwords must not be secret. With good crypto you can have every user use a different session key, so that even if they know each others' passwords they can't snoop on each other.)
Miscellaneous Points
Here are a few guidelines for details of the policy which might help:
- The quality of service could be specified by three numbers: bandwidth, reliability and latency-to-backbone; that way users can communicate what's most important for them to the free market.
- Perhaps users should pay on a sliding scale, with payments tied to the quality of service received, so that there is always an explicit incentive to provide better Internet service.
- Assuming only 25% of residents who want a given service would pledge for it, maybe the city should match pledges paid out of property tax.
- Since optical fiber is cheap but expensive to lay, it's a common practice to lay cables with many more fibers than will be needed in the near future. These "dark" fibers can later be cheaply lit if needed. Policies should probably specify that some percentage (like 95%) of the fiber laid to make a network must be dark.
- Depending on political will, it might make sense to pay for city-wide phone-level coverage off the bat through taxes, and let people pledge for upgrades as desired.
In the Chicago example of last post we saw that the entire city could have a free data network for a one-time cost of under $15 per person. People are probably willing to pay a lot more for much faster connections; the plan outlined in this post shows a way in which a publicly-owned network can deliver services the public wants as soon as their feasible to deliver without wasting money on advertising and accounting.
This plan isn't anti-business either. The local companies which would spring up to supply the network services asked for by the people would have a leg up spreading to other municipalities where this same incentive policy gets implemented. (I am fairly confident that other municipalities would want to emulate the digital utopias which would come from this type of municipal Internet service.)
With some organization, the people can have cake and eat it too: they can pay a pittance in extra tax in exchange for hassle-free, state-of-the-art Internet connectivity. Everybody wins except old-school ISP shareholders. (Sell!)
*Web 2.0 couch potatoes?
Wednesday, May 9, 2007
The Answer is Blowin' in the Windy City
Greetings, chatterboxes.
Today I'm going to outline why I think municipal wireless networks are a good idea. We depend more and more on Internet connectivity for our everyday lives; it's no longer the case that bandwidth is a luxury item only a small niche desires. However, the way we typically pay for bandwidth (through private Internet Service Providers, or ISPs) is tremendously inefficient. I'm going to outline an estimate of how inefficient privately-owned ISPs are, then in the next few posts I'll talk about a way in which publicly-owned networks can be financially and technologically sustainable.
Getting Hosed by ISPs
Bandwidth at Internet backbones is ridiculously cheap: about $1 per terabyte (TB) and falling fast. (Based on estimates of web-hosting costs which allow 3 TB of transfer per month for $5 per month - the $1 per TB might not be accurate to within more than an order of magnitude. I don't specifically endorse the web hosting company I linked to - it's just an example of how cheap backbone bandwidth can be.) A heavy home user might transfer about 20 GB of bandwidth per month, costing their ISPs no more than a few pennies per customer per month.
However, the rates which ISPs charge their customers is three orders of magnitude higher: $20 per month is considered a good deal. That's a markup factor of at least 1000.
There are at least three main expenses other than backbone bandwidth which contribute to the costs of running ISPs:
If a publicly-operated free (as in beer) municipal Internet network existed, there would be no need for costs # 2 and 3, and I postulate that #1 could take a big hit too by allowing better technology to be used. I think that one of the major reasons private ISPs are scared to deploy city-wide mesh wireless networks is that if users shared their passwords with friends, they could lose customers. Instead they've opted for wired networks (through DSL or cable) which are probably a lot more expensive than wireless mesh networks so they can be sure you don't share your account with friends.
Why do I think mesh networks are cheaper? The City of Chicago plans to roll out a city-wide wireless mesh network for only $18.5 million. A city-wide network would supplant not only ISP communication, but if a few Asterisk servers were part of the setup you could replace aging telephone lines and cellphones with voice over IP (VoIP), obviating the need for phone companies, whose costs are also dominated by the three numbered items above.
Savings
How much do Chicago's 3 million residents currently pay for phone, Internet and cell phones? If we assume one ISP line (at $20/mo.) and one land line (also at $20/mo.) for every 4 residents and one cellphone (at $30/mo.) for every two residents, we'd estimate that Chicago spends $900 million per year on combined data services. Even assuming Chicago's network costs double the estimate with a one-time cost of $40 million, a municipally-funded wireless network is an exceedingly good deal.
If the backbone bandwidth cost were approximately one penny per resident per month it would not be worth the city's while to try to charge people for their individual bandwidth usage, just as we don't try to charge people who use streetlights more for their fair share of electricity costs to the city.
Conclusions
Even if implemented poorly, a publicly-owned data network would give astronomical cost savings over the current arrangement. There are still the potential pitfalls that a publicly-owned network might be terribly cost-inefficient, or that it might not give the quality of service expected by the residents. However, in my next post I will unveil a plan which addresses both of these woes.
Until then!
LeDopore
Today I'm going to outline why I think municipal wireless networks are a good idea. We depend more and more on Internet connectivity for our everyday lives; it's no longer the case that bandwidth is a luxury item only a small niche desires. However, the way we typically pay for bandwidth (through private Internet Service Providers, or ISPs) is tremendously inefficient. I'm going to outline an estimate of how inefficient privately-owned ISPs are, then in the next few posts I'll talk about a way in which publicly-owned networks can be financially and technologically sustainable.
Getting Hosed by ISPs
Bandwidth at Internet backbones is ridiculously cheap: about $1 per terabyte (TB) and falling fast. (Based on estimates of web-hosting costs which allow 3 TB of transfer per month for $5 per month - the $1 per TB might not be accurate to within more than an order of magnitude. I don't specifically endorse the web hosting company I linked to - it's just an example of how cheap backbone bandwidth can be.) A heavy home user might transfer about 20 GB of bandwidth per month, costing their ISPs no more than a few pennies per customer per month.
However, the rates which ISPs charge their customers is three orders of magnitude higher: $20 per month is considered a good deal. That's a markup factor of at least 1000.
There are at least three main expenses other than backbone bandwidth which contribute to the costs of running ISPs:
- The "last mile" connectivity between multiple homes and a backbone connection point
- Advertising and promotion
- Billing customers
If a publicly-operated free (as in beer) municipal Internet network existed, there would be no need for costs # 2 and 3, and I postulate that #1 could take a big hit too by allowing better technology to be used. I think that one of the major reasons private ISPs are scared to deploy city-wide mesh wireless networks is that if users shared their passwords with friends, they could lose customers. Instead they've opted for wired networks (through DSL or cable) which are probably a lot more expensive than wireless mesh networks so they can be sure you don't share your account with friends.
Why do I think mesh networks are cheaper? The City of Chicago plans to roll out a city-wide wireless mesh network for only $18.5 million. A city-wide network would supplant not only ISP communication, but if a few Asterisk servers were part of the setup you could replace aging telephone lines and cellphones with voice over IP (VoIP), obviating the need for phone companies, whose costs are also dominated by the three numbered items above.
Savings
How much do Chicago's 3 million residents currently pay for phone, Internet and cell phones? If we assume one ISP line (at $20/mo.) and one land line (also at $20/mo.) for every 4 residents and one cellphone (at $30/mo.) for every two residents, we'd estimate that Chicago spends $900 million per year on combined data services. Even assuming Chicago's network costs double the estimate with a one-time cost of $40 million, a municipally-funded wireless network is an exceedingly good deal.
If the backbone bandwidth cost were approximately one penny per resident per month it would not be worth the city's while to try to charge people for their individual bandwidth usage, just as we don't try to charge people who use streetlights more for their fair share of electricity costs to the city.
Conclusions
Even if implemented poorly, a publicly-owned data network would give astronomical cost savings over the current arrangement. There are still the potential pitfalls that a publicly-owned network might be terribly cost-inefficient, or that it might not give the quality of service expected by the residents. However, in my next post I will unveil a plan which addresses both of these woes.
Until then!
LeDopore
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21st century capitalism,
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economics,
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Internet,
politics,
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