Broadband in America – We’re doing it wrong

For the last six months or so, the focus has been on Netflix and net neutrality. Should ISPs be allowed to rig their high speed networks, through various means like traffic shaping, peering and interconnection decisions, etc., to purposefully disadvantage or advantage an internet-based service or experience. The majority of the users on the internet seem to think that no, they shouldn’t. But corporations and corporate apologists seem to think that without giving high-speed internet monopolies or duopolies the freedom to do whatever they want will mean an end to broadband investment, and a loss of competitiveness as a whole.

First its important to note why regulation is so heavy-handed in this market. Its all about competition, or lack there of. The barriers to entry for building out a wireline or wireless high speed data infrastructure are immense. And those high barriers to entry mean there is a lack of competition. And that lack of competition means that the competitors who are established in the existing market environment need to be regulated to ensure that the consumer is protected, especially with a product especially as important as internet access.

The current broadband situation in America isn’t great, its not even good. We have more than one problem, even if the Netflix/Comcast issue is the most salient issue right now. Our issues are…

  • Speed: our speeds are slower than most other developed countries around the world, and even some developing countries have faster, cheaper internet in their cities than we do in the US
  • Usage Caps: most large ISPs that offer fast speeds have or will soon have data caps to prevent users from downloading a lot of data (read: protect their expensive TV packages from over-the-top competition)
  • Open access: companies like Comcast and Verizon have decided not to increase their network interconnect capacity with certain companies to keep Netflix traffic slow. Level3, a tier 1 ISP, even illustrated the habit of ISPs creating congestion to incent data providers to enter paid-peering arrangements.
  • Strategy Taxes/Internal conflicts-of-interest: companies that provide internet access have their own vested interests (television, phone) so they have internal conflicts of interest to providing an open, unfettered, fast internet experience
  • Lack of competition: it costs a lot of money to build a broadband network from scratch, so there is not a lot of incentive to enter a market to create an additional competitor, especially if a regional or nationwide competitor can create a price war locally until you run out of cash and go bankrupt.

How can we solve all five of these problems? New rules for Net Neutrality, or regulating ISPs as Common Carriers under Title II don’t solve all the problems. We’re still left with the monopoly/duopoly with companies we have now. They’ll begin work immediately to lobby for loopholes in the rules or legislation, while working to undermine the enforcement through lawsuits, and finally by getting people friendly to them in the regulator’s chair to keep the rules from being enforced.

It turns out our approach to internet access its entirely wrong-headed. Infrastructure should only be built once and from there, upgraded over time to meet demand. Otherwise we’re just wasting money. Let the market compete on top of the infrastructure, not by building separate infrastructure networks and selling proprietary access to that network.

But we can’t just throw it all out and start over.

Infrastructure

The internet is most often referred to in analogy as a highway network. Billions of miles of fiber optic cable criss-cross the globe carrying your request to watch that funny cat video for the 100th time.

There is robust, healthy competition at the “Tier 1″ level – that is, the worldwide backbones that carry traffic all over the world. But when it comes to your metropolitan area, that last few miles of connectivity are often dominated by one or two competitive ISPs1, in the same way your local roads are maintained by your local municipal agency (whether its a city or county).

This infrastructure is expensive. Its expensive to build – which is why we have so few options in the first place. Its expensive to maintain – everyone keeps using more and more data, and it costs money to add capacity to the network. So why are we building redundant infrastructure in many places?

Does it make sense to build two power grids to provide some fig leaf of “choice” for consumers, while the fixed costs of building and maintaining two separate power grids are factored into everyone’s monthly bill? Does it make sense for your community to build two sets of roads for the same purpose2.

But with our current state of broadband, its not as straightforward as that since the cable and phone networks were originally built for other purposes, and were re-purposed for internet access. Phone lines are inherently more handicapped than their coax sibling – DSL speeds are pretty much always slower than cable. But phone lines are more ubiquitous, usually required by regulation. Cable companies can pick and choose who they serve – if you’re not sufficiently urban or suburban, I hope you like DSL and Dish/DirecTV!

Wireless-only options are a very distant third place in the broadband game, encumbered by very low monthly data transfer caps, high cost, and questionable signal strength3.

So we are left with different kinds of monopolies in the two different situations – in exurban and rural areas, DSL is your only option because you are unserved by cable; elsewhere cable ISPs can offer much faster speeds than DSL can manage and its really a not much of a competition4.

Even in the best case (fast cable and fiber-to-the-home from the phone company), we’re left with duopolies that have similar products (triple play bundle of TV, phone and Internet). This means that, in the case of Verizon and Comcast, they have no incentive to help Netflix or future over-the-top video providers eat away at their revenue for entertainment services. Which means we still lack a competitive environment, as long as the ISPs have something else to sell you that could easily be provided over the internet in general?5

Loop Unbundling

One option for solving the problems would be to force loop unbundling on the cable and phone companies, requiring them to lease their own lines at competitive rates6. This would allow other companies to sell internet service over the hosting company’s coax or fiber-optic network. These companies would be responsible for their own transport out of the network to whatever Tier 1 ISPs they purchase transport from, and all of the technical support, billing and usage information, etc.

Loop unbundling works well in Europe, but their business environments are drastically different than ours in the US (PDF), and I fear that between the relentless lobbying budgets of the cable and phone industry, the bad-faith dealings and legal shenanigans that would occur against those who want to come in and resell transport, it would not be a profitable business. In the same way we see cable and phone companies working hard to prevent municipal broadband, we would see an even more rigorous offensive campaign against loop unbundling before, during and after its implementation.

Heavy Regulation

Another option would be heavy regulation of internet service provided by wireline companies. This regulation has been happening at the national level with the FCC, but maybe that’s the wrong place for it. The best option may be with the local and state agencies like Corporation Commissions or Public Utilities Commissions. In the same way electricity rates or phone companies are regulated by a PUC or Corp Comm., so would the internet access. The Department of Energy in DC doesn’t regulate your electricity rates, so why does the FCC want to regulate broadband with the goal of making it more affordable and ubiquitous? The local solution may be much more effective because local officials are much more responsive to citizen complaints. If everyone is complaining that Netflix is running slow on Comcast, or that Verizon is intentionally letting its copper-based infrastructure degrade, the PUC may be in a better position to force Verizon or Comcast to deal with it than a gridlocked FCC or Congress.

This would put some burden on the telecommunications companies because its more government they have to deal with. In my case with my ISP (Cox), they seem very receptive and integrated with the local community7, so I don’t believe that for companies like Cox it would put an undue burden on them, but for large companies stuck in that unaccountable monopoly mindset like AT&T, Verizon and Comcast, it would be more difficult.

Municipal Broadband Networks

One option that has had mixed results so far is municipal broadband networks, where the local government agency owns and runs the ISP. Unfortunately, approximately 20 states have legislation that prevents or has halted the growth of these types of networks. The FCC is looking into creating regulation that would overrule states’ abilities to pass laws against them.

The existing companies have one legitimate issue with municipal broadband networks as competitors – these private companies have invested billions and billions of dollars in infrastructure and they don’t want the government to offer a subsidized competitor with the community’s tax dollars making up for the financial losses. However, that is not an excuse for the banning or restriction of municipal broadband networks. The community’s side is that broadband is (in their opinion) more expensive than it should be – see Chattanooga’s successful $70/mo Gigabit internet service – and nationwide ISPs are unresponsive or just don’t see the return on investment needed to build out or improve service. Ultimately, the benefits of municipal broadband networks is that, as taxpayer-owned agencies, they are ultimately responsible to the people they serve through the feedback look of their board of directors being locally elected officials. Short-circuiting the dysfunction in the marketplace and in Washington DC through local elections.

Municipal broadband networks aren’t always successful though, either through internal mismanagement or being undercut by a national competitor (who can sustain losses in one region) for a long enough period of time to lead to financial ruin for the publicly funded network.

Building a True 21st Century Broadband Network

The goal would be to build a network that combines the advantages of the methods described above, while trying to do this as cheaply as possible and without building a redundant network.

Eminent domain

Eminent domain is essentially creating the municipal broadband network while removing the threat of a private broadband company attempting to undercut and destroy the effort8. Customers can continue to use their existing ISP under a temporary management agreement until the necessary infrastructure upgrades can be made to support Loop Unbundling.

Network Migration & Loop Unbundling

Eventually, all devices on the network (Internet, TV, Phone) will need to be IP or have a set-top-box for incompatible devices. This would be the most difficult aspect – you would need either affordable devices that can authenticate themselves to the network and then broadcast the subscribed set of channels over the customer’s home coax, or you would need even cheaper boxes for people to hook up to individual TVs and output the broadcast signal over RCA, S-Video or HDMI to the TV.

Management

The new network would be managed by a regional “Broadband District” for a metropolitan area. That BD would issue bonds to purchase the physical infrastructure from the cable company or phone company (whoever has the best infrastructure) by force at market value under eminent domain. Once the network migration is complete, it would be opened up to anyone who wanted to run their own ISP.

Eventually the goal would be to use the local fiber loop purchased by the government agency to provide everyone fiber to the home, and then allow everyone to have a competitive list of broadband providers to choose from.

Successful Business Models

The unbundled nature of the network would provide for real competition, ranging from little value-add (here is your internet service, have a nice day) to high value-add (on-location tech support, home networking, security, phone, TV, whatever else they can think of) at various prices.

Companies like Google or Facebook could offer subsidized service that, in exchange for your browsing habits, phone records, TV watching habits, dignity, and whatever shreds of privacy you have left, give you a discount on service.

For economically disadvantaged areas, instead of providing fiber to the household or multi-tenant building, offer WiFi services and prepaid broadband cards for a fixed amount of data transfer (1GB, 5GB, 10GB) sharable amongst a number of devices. This way, even those with only a basic smartphone could still use the internet for essential tasks like applying for jobs or requesting benefits.

Conclusion

First, we need to remove redundant investment. We don’t have competing road networks, power grids, or water systems9. Why do we have these expensive, redundant last-mile communication networks? Because of some historical legacy? Time to ditch them and have one broadband infrastructure for all Americans.

Next, we need to figure out where competition works – clearly its not working in its current state as prices climb and the US lags in broadband penetration. Letting companies compete over a shared infrastructure will work – it works every day as companies compete with each other while driving over our shared roads, utilizing the power grid and water and sewer networks.

Finally, costs need to be managed as we convert the proprietary networks of today to the open networks of tomorrow. We can’t have gold-plated equipment blowing up the budget. Any agency willing to do this would need to be responsible and disciplined in its conversion to eventually opening the network up to other companies to compete on.


  1. I moved recently, and actually lost my phone company – when I moved in, Centurylink wasn’t able to provide DSL at my house, so my only option is Cox 

  2. By this, I mean having two driveways, two street addresses, two non-interconnecting local streets that both connect to the highway network 

  3. Masayoshi Son’s fevered dream of using Sprint’s 2.5GHz spectrum to compete with wireline home broadband is laughable – its a simple matter of physics, even 120MHz of shared wireless communication at QAM64 isn’t able to compete with 200MHz of coax bandwidth operating up to QAM4096 (the DOCSIS 3.1 spec) to offer 10Gbit speeds to your home 

  4. My Cable ISP’s two main tiers are now 50Mbps and 100Mbps, while the fastest the DSL company can go in most locations its 10Mbps 

  5. Cable and phone companies have started to get into the home automation and alarm markets lately, does that mean that AT&T should be able to handicap their internet traffic from ADT and alarm.com to harm competition? 

  6. Which probably would not be competitive, but what are you going to do? Sue them and their lawyer army in court? How profitable is that? Its just cheaper to put up with their uncompetitive rates. 

  7. Even though they raise my cable and internet bills by 10% a year, 3-5x the rate of inflation 

  8. This isn’t socialism or communism — as long as the assets are purchased in the public interest (to provide faster internet at cheaper prices) for fair market value 

  9. Even in the great free market of Texas, there are multiple energy companies, but only one energy transmission company – why? Because infrastructure is expensive! 

Apple WATCH battery math update

One the things I mentioned during my Apple WATCH post was the estimated battery capacities. Well, thanks to iFixit, the iPhone’s battery characteristics have been revealed and using the same type of batteries in the WATCH would stand to improve on my estimates somewhat. Here are the figures for the iPhone 6 and 6 Plus batteries

So what does this mean for the watch? That the battery capacity would be slightly higher than my original estimates of 1.9Wh or 520 mAh at 3.6V. Its more likely that the battery will end up around 600 mAh or 2.1Wh at 575Wh/L.

Tesla Model S AWD, Autopilot and Model 3…

Model S AWD

The Model S AWD models are impressive. We knew they were coming for a while now – there is a space in the frunk that would be perfect housing for the motor for the front wheels. The performance is the headline here – 691 HP (combined) and 3.2 seconds for the 0-60 time launches the Model S AWD into supercar territory. But its not a supercar that just sits in the garage and looks nice – its a great daily driver, highly efficient, very low total cost of ownership per mile relatively speaking, and very user friendly. Beyond that, the way the two electric motors are tuned to work together help improve the overall efficiency of the car, allowing it to, despite the added weight of a second motor, increase the electric range from 265 to 275 miles for the performance model and a whopping 30 mile increase from 265 to 295 for the non-performance 85kWh model (numbers provided are Tesla estimates, EPA numbers are presuming to be pending certification before deliveries in December).

Autopilot

The new Autopilot functionality of the Model S seems eminently more practical than the hyped up Google self-driving car of the last few years. The great news is that instead of having to wait until 2018 or 2020, we can get highway autopilot several years earlier than expected.

The sensors include sonar around the car (forming a bubble around the car) as well as a forward-looking radar and camera system. These allow for active safety systems – automatically braking the car if an obstacle in front is detected, preventing you from steering into a car in your blind spot, etc. These features have existed in cars for a few years now. Beyond the active safety systems is the new Autopilot software.

Autopilot is a very fitting name for this feature, as it mimics overall idea of autopilot on a airliner – the pilots control everything until the plane is at a comfortable cruising altitude and can be turned over to an automated system. Same with cars – if your commute is a long drive on a highway, once you’re on the highway, you can manage the car with just the turn signal. Cameras read the speed limit signs, slow for cars in front of you, and perform actions to keep you safe.

Though after watching the official Tesla video and reading the press release, I wasn’t quite sure what features are being delivered today and what will be made available in future over-the-air updates to the autopilot software. What’s important is that the hardware necessary for autopilot is being delivered today. Software improvements can come in time, but its prohibitively expensive to go back and retrofit this hardware on existing cars (Tesla has stated they won’t retrofit, so you’d have to buy a new Tesla and trade in your old one). As Tesla adds features to the autopilot software over time (the ability of the car to park itself in a garage without you in it), the car will evolve to the self-driving ideal, though it won’t make it all the way there.

The only negative is I don’t think there are enough sensors – that in the future, rear facing radar sensors or cameras will be added to the package to help the car switch lanes when there are high differences in the rate of speed between the two lanes. And making sure the sensors are redundant enough to withstand a failure.

Model 3

One of the interesthing things about the new AWD cars is that the smaller electric motors (188 and 221 HP) seem to be a perfect fit for a Model 3-sized car – one for the standard model, and one for a “performance” Model 3. Tesla should be able to re-use the motors with small adjustments in the firmware to optimize it for single-axle drive.

Beyond this, we’re able to get a better idea of the specs of the Model 3. One thing Elon has stated is that the Model 3 will be about 80% of the size and weight of the Model S. The Model S originally (2012) had a curb weight of 4,450 lbs. However recent statements have indicated they’ve taken “hundreds” of pounds out of the car, I’d estimate the current curb weight for the single-motor model is around 4,200 lbs. A 20% reduction would put the car around 3,400 lbs. A 188 HP motor should be able to propel the car with respectable (certainly not supercar) 0-60 MPH times. By comparison, my Chevy Volt has a curb weight of 3,700 lbs and only a 160 HP motor. While 188 HP might not sound like a lot, the fact that its electric and instant torque will compensate for the relatively small HP rating compared to gasoline engines.

The battery for the future Model S will end up around 45kWh using these smaller motors, reduced vehicle weight and improved efficiencies (an improvement from 300 Wh/mile in a RWD Model S to 225 Wh/mi for the base Model 3). This reduction in pack capacity, combined with the reduced costs of the pack through the Gigafactory increase the chances that Tesla will be able to hit the $35,000 price with a base 200-mile model. The conservative estimate for packs out of the Gigafactory is $196/kWh (down 30% from Tesla’s early 2014 baseline of around $280/kWh), and the aggressive estimate is around $168/kWh (down 40%), which would put the pack price between $7,600 and $8,800. This is 22-25% of the price tag of the overall vehicle, which should leave plenty of room for the rest of the car (50%, or $17,500) and a gross margin of 25%. A longer range 60kWh version could be made available with the beefier 221 HP motor for a range of just over 250 miles. The only issue with a battery pack that small is how fast (or slow) it can be supercharged.

The Apple Watch & Batteries

One of the things not mentioned at today’s Apple Keynote was the battery life of the APPLE WATCH. It was implied that it would be recharged every night, there was nothing specific about the hardware itself.

Battery life is determined by three things – size of battery, power intensity of the CPU/SOC and the power consumption of the display.

We will assume the display is using the most efficient display possible – IGZO or aSi. This will minimize the power draw from the display as much as possible.

The CPU/SOC is likely minimized as much as it can for the first generation product. This is where Apple will need to innovate – integrating more and more functions from discrete chips in the APPLE WATCH package into one piece of silicon that can be fabricated at a small process (which as of right now is 20nm from TSMC).

Batteries, however, don’t progress as quickly as everything else. They improve at about 8% per year, and thats in a good year. It’s why we’re not all driving electric cars right now. Electrochemistry is difficult.

Specifically, the issue with the batteries for the APPLE WATCH is the volumetric energy density. Apple needs a battery that has a high volumetric energy density (measured in Wh per liter) so that they can cram as much watt-hours as they can inside a specific volume. This is different that EV companies, which are typically looking for high gravimetric energy density (Wh per kg).

Right now, some of the best batteries are about 700 Wh/l (for this application, NCM Li-Polymer from SK Innovation at 200Wh/kg and ~700Wh/l). If we assume the battery inside the WATCH is 30mm x 25mm x 5mm, or 3750 cubic millimeters, thats 0.00375 liters. If Apple used the best battery technology possible, they would have about 2.7Wh of storage (730mAh at 3.6V). That figure seems high, so I’m guessing they’re using something less substantial (probably in the 500 Wh/l range) around 1.9Wh, or 520mAh. 

The difficulty Apple faces when it comes to battery development is that it is largely on its own – most battery companies are working hard to increase the gravimetric energy density and the cycle life of batteries. For example. Li-S batteries, while the gravimetric energy density may increase to from 200 to 400Wh/kg, the volumetric energy density is only in the range of 425Wh/l. Lighter batteries do Apple no good – they need more space-efficient batteries.

This is why my hopes are dim for amazing battery life on the APPLE WATCH anytime soon. It will take several generations of hardware integration and software optimization before the product matures. But this is no different than the original iPhone, with its slow 2G data speeds, adequate battery life and no apps.

CenturyLink’s Gigabit Service is a PR move, not a solution

Initially announced in October 2013, Centurylink Las Vegas announced they were bringing Gigabit internet speeds to the Las Vegas area (FTTP, or fiber to the premises). All the politicians were happy to announce what a great thing it was for our city to make us part of the “21st Century”.

The problem though, is that its simply “Fiber to the Press Release“, a token effort designed to keep competitors away (like Google Fiber or a municipal fiber effort). The problem is that there are no build-out deadlines, rather they’re simply upgrading their infrastructure to the richest, most profitable customers, further enhancing the digital divide between the haves and have-nots.

Centurylink has announced approximately 40 subdivisions (about 20 initially in December 2013, and 20 more in spring 2014, plus a recent announcement of availability to select businesses) that will be enhanced with FTTP, which is approximately 5,000 single-family homes using a generous estimate of 125 homes per subdivision. At this rate of 5,000 single family homes per year, it will take CenturyLink 80-100 years to provide fiber to the home for all 400,000 to 500,000 single-family homes in southern Nevada, and thats even making the assumption that all new subdivisions built moving forward are built with FTTP.

There is no reasonable mind that thinks 80-100 years is an acceptable time frame to wire up a city with Gigabit Internet. The politicians or the PUC of Nevada need to force Centurylink to move faster in wiring up homes with gigabit speeds.

Chamberlain MyQ Garage Quick Review

I don’t know if its me getting older (being 33 is hard, kids!), but lately I’ve had a harder time remembering if I’ve closed the garage door or not when leaving the house. I’ve wanted to have a wifi connected garage door opener, but I didn’t want to replace my perfectly good garage door opener I have now.

So one day when my girlfriend told me she didn’t remember if she closed the garage door, I reached my limit and decided that I was going to go online and find some sort of sensor to tell me if the garage was open or not. What I found were some Raspberry Pi or Arduino sensors – not really what I was looking for. I wanted something a bit more professional. I ended up coming across the Chamberlain MyQ Garage Door controller. It was expensive at $129 (a brand new MyQ-Enabled Chamberlain garage door opener is $200), but after spending my lunch hour driving home and back to work, I was ready to pay that.

The first thing I had to do was check compatibility – does the garage door have the photosensors to prevent the garage from closing on someone or something, and is it using a compatible frequency and code. I happen to have a compatible Chamberlain LiftMaster, as well as an open 120V outlet near the garage door opener, so I was ready to order and go!

Installing it was easy, except for the part where they didn’t tell you what size drill bit to drill the pilot holes for the screw anchors (5/32″). I guess thats something they expect you to know, and this DIY-newbie didn’t know that.

20140319-111932.jpg

All you needed to do was install the WiFi hub on the ceiling, plug it in, and then secure the door sensor properly on the garage door. With those two things accomplished, the rest can be done from your phone via Bluetooth 4.0. Once you pair your phone, you can share your WiFi credentials from your iPhone to the WiFi hub to get it connected and online, and from there, you can use the MyQ app to create your account, link the hub to the account, and program the hub to talk to the garage door opener. It tries various garage door opening commands, and it knows when it succeeds because it has the sensor on the garage door itself.

MyQ Garage Status

The only issue I had with the entire online process was that it took about a half hour to get the verification email for the new MyQ account. So I had to wait for the email to activation the account before I was done with everything.

But now I can see the status of my garage door, as well as open and close it remotely.

Update 3/22: 
Chamberlain reached out to me to explain the PIN access. First you have to set a PIN code under the Account settings in the app. Then you have to set your security level – you can have it never prompt for a PIN code or 1) on app start, 2) accessing the account, or 3) when you perform an action on a door or gate. Personally, I think a PIN code should be mandatory and that it should prompt you on open/close actions. I’m used to my Chevy Volt OnStar application that requires me to enter a PIN code (which is validated on the server side) to lock/unlock doors, or to remote start the car. It seems like a good way to protect the car from unauthorized actions.

Pros:
Ease of use – being able to transfer my WiFi password over BT to the hub (instead of having to type me 25 character password) made it super easy to get the unit online.
Convenience – being able to check and close the garage door remotely will be very useful the one day I forget to close it

Cons:
Cost – at $129, its 65% of the cost of buying a replacement garage door opener that is MyQ enabled out of the box
Instructions – the instructions are written for someone who is a bit more handy than I (though I am getting better, installed some new bathroom hardware a few weeks ago)

Zales online is awful…

(disclaimer: rant ahead)

I normally don’t write about bad customer service stories, mostly because the online retailers I deal with are pretty good. But that changed this month when I bought a necklace for my girlfriend from Zales for Valentines Day.

I ordered on Feb 10, with Zales offering “Guaranteed Delivery for Valentines Day” with a chart on their website about how it would ship depending on what day you ordered it.

I called twice on Valentines Day after noticing that it still hadn’t shipped, once in the morning and once in the evening. They said they would have to check with their warehouse as to why it didn’t ship, why the order got lost. My girlfriend was pretty upset about not getting her gift on Valentines Day.

I called the Tuesday (2/18) and they still didn’t have a status update on why the order was lost, four days later. I called again the next day for a status update and they still didn’t have information on my order, so I cancelled it. That weekend I went out and bought my girlfriend something from Kay’s (despite their incredibly annoying commercials).

This week they shipped the order. Eight days after I called and cancelled it. Unbelievable.

This is the type of awful customer service I expected in the early 2000s when everyone had really poor e-commerce systems and bad logistics. Not in 2014. I’ve had more problems with them than I’ve had in the last 4-5 years of shopping online. Amazon, Newegg, Express all provide good customer service – shipping out orders on time, handling returns well, etc. But Zales… ugh, never again.

Update: Zales contacted me after I tweeted them this, and they contacted FedEx to recall the shipment and refund my credit card. Why can’t regular customer service reps do this?

How time-of-use electricity billing saved me $500 a year

Back in late 2012, I switched to a time-of-use billing schedule for my electric service with NV Energy (now part of Mid-American, a Warren Buffett joint). I was eligible for a cheaper time-of-use rate because I own an plug-in electric vehicle, allowing me to get deeper discount rates from 10PM to 6AM each day for the entire meter (not just EV charging). Around the same time I also installed Nest thermostats that include a number of features that save me electricity during the hot summer months when the time-of-use rate is at its highest (33.4c/kWh).

The price structure and time schedule is:

  • Winter: October 1 through May 31; Off Peak: 5.0c/kWh (10PM-6AM), On-Peak: 5.5c/kWh (6AM-10PM)
  • Summer: June 1 through September 30; Off Peak: 6.9c/kWh (10PM-6AM), Mid-Peak: 7.6c/kWh (6AM-1PM and 7PM-10PM), Peak: 33.4c/kWh (1PM-7PM)
Billing Month On-Peak Mid-Peak Off-Peak TOU $ Flat rate (11.7c) $
November 652 0 491 $54.20 $133.73
December 815 0 572 $65.92 $162.28
January (Est.) 418 0 286 $33.48 $82.37
February 646 0 546 $56.32 $139.46
March 677 0 486 $55.23 $136.07
April 795 0 476 $60.69 $148.71
May 817 459 1163 $195.98 $285.36
June 498 806 720 $267.15 $236.81
July 460 746 693 $248.66 $222.18
August 452 743 570 $237.94 $206.51
September 348 214 241 $109.77 $93.95
October 642 0 398 $52.18 $121.68
Total $1,437.53 $1,969.11

Notes:

  • The service fee premium for a ToU account over a regular account is $1.30/mo, or $15.60/yr, so the savings have to be adjusted by that amount
  • January was an estimate since NV Energy has a difficult time with their billing system and time-of-use accounts – I signed up for e-bills but occasionally I’ll get a paper bill in the mail.
  • The billing month crosses two months (I tend to get my meter read in the middle of the month)
  • My Nest thermostats were set (manually) to cool the house down in the summertime to 70F by 12:30PM, a half hour before the peak period begins, and then were set to 76F the rest of the day. This was to cool the house down and then let it warm up when the electricity rates were higher
  • This large cost savings may not last for much longer, NVEnergy has been consistently increasing the time-of-use rates in the last year, even my most recent bill had winter prices increase by about .4 cents per kWh. At this rate I would expect to be back to paying the same as the flat rate in 4-5 years.

Its my opinion that the Nest thermostats helped a lot in keeping the summertime energy use down, contributing to the savings. Beyond this, having cheaper overnight rates to plug in my Volt means that I pay about 2-3c/mile for my Volt for electricity (a Prius by comparison is about 7c/mile), which improves the ROI calculations on the Volt because I save more money compared to a gasoline car.

Five Picks: 2014 is the year of ________

My five picks for 2014…

The Middle Class Comeback

Finally, after 6 years, the middle class will start to see rising wages and more opportunities for jobs. The linchpin that determines the strength of the comeback is the quality of jobs created. Minimum wage jobs don’t help much, they just allow corporations to push part of their wage cost to taxpayers. They need to be factory jobs and well paying jobs with benefits. It might not be the best job (its not a doctor, lawyer, or successful app developer) but it’ll work. What worries me is if we have another recession before the middle class recovers – that spells social strife and civil unrest.

Public EV Charging

From standard public charging to Tesla’s SuperCharger network, charge station installations are set to grow, and with increasing EV/PHEV sales in North America, usage of these stations will increase enough that they’re no longer just a blip on the radar. The growth of stations will be what to look at for 2014 – and instead of being token installations, they’ll be more functional, with installations at places you 1) actually want to park your car for an extended period of time and 2) free or reasonable rates to charge your car. The latter one may take some effort in some states that only allow utility companies to sell electricity by the kWh, which forces charging stations to charge by the hour (not the best deal usually).

LED Light Bulbs

LED light bulbs are going to make a big impact in 2014. They’re finally becoming cheap and good enough that you’ll want to replace your regular bulbs. Beyond that, high-usage CFLs that were installed during the CFL boom are starting to hit the end of their lifespan. I now have six CFLs in my garage that are burnt out and have run out of my spare CFLs, so now each time a CFL burns out I’m ordering these $20 Philips 13-Watt (65 Watt Replacement) BR30 Dimmable Indoor Flood Lights. They’re really good so far. I haven’t tried any regular light bulb replacements yet, but I’m sure I will sometime in 2014.

“Over the top”

“Over the top” is a phenomenon where a company that provides several consumer services including internet access finds that some of its services are being cannibalized by similar services over the internet. The most familiar examples are using Netflix over a cable-based internet connection (instead of going to cable TV for entertainment, you’re consuming Netflix), as well as iMessage or some other internet-based chat/picture service instead of SMS/MMS services. For incumbent internet providers, this will be a difficult transition to manage because they will be faced with decreasing revenues from core products and increasing usage of internet data. For the cable industry – get ready, people are cutting the cord. More data, less everything else.

Gay Marriage

If its now legal in Utah, one of the most conservative states in the union, I don’t see how other states are going to face the legal challenges of their laws or constitutional amendments. I hope Nevada (my home state) has their constitutional amendment overturned quickly, as it would be a boon as a gay wedding destination. I should look into buying the old Liberace Museum! I can add a chapel and boom!

 

Everyone is wrong about cell phones on planes

(Except Runway Girl)

Recently, the FCC looked to drop its technical reasons for prohibiting cell phone calls and texts on planes above 10,000 feet.

First, lets take a look at how the system works to understand why everyone is wrong.

Each plane that will allow cell phone calls above 10,000 feet will be equipped with a microcell that will connect (through GSM and CDMA) at very low power to all the cell phones in the cabin. These cell phones in the cabin will then be connected, via the microcell and a ground link, to a cellular network that is run by the airline and their equipment partners – not their own carrier (AT&T, Verizon, etc.). This will put the cell phone into roaming mode – just like if you were in another country.

And what happens when you’re in another country on your cell phone? If you make or receive a call, you rack up sky-high (no pun intended) roaming charges. And thats why you won’t end up next to a chatterbox for hours – the cost of being a chatterbox on an airplane would likely be around $2-3 per minute, or $150 per hour to talk on the phone while flying. For example, Vodaphone UK charges 1.99 GBP per minute to make an in-flight call, that is currently equal to $3.26 per minute.

Why is it setup this way? Because then the airlines and equipment and service provider can charge exorbitant roaming fees for cell phone calls placed when the aircraft is airborne. Would you pay $150/hour to talk on the phone from an airplane? Unless its an emergency, I doubt it. A few texts might be sent, but thats no longer abnormal because people can use data-based messaging services on aircraft Wi-Fi now (Facebook Messenger, iMessage, Google Chat, etc).

These sky-high prices will prevent people from chatting the entire way from LA to NYC. A phone call placed for the eligible duration of a five hour flight would cost around about $700.

If you happen to have a chatterbox next to you, just pull out the in-flight magazine and show them the various charges for in-flight calling and watch their eyes widen as they hurry up to end the phone call.