[citation][nom]JPForums[/nom]To put it in terms of water lines, it is because your ISP is selling you the pipe, not the water. [/citation]
This isn't quite applicable, some parts of it are true, some parts are false for cable. Even in different areas, different packages, this could be more or less so true. To simplify my response: this is misleading.
To put it in water pipe terms: If every house getting water from the pipe turned on their water on at the same time, in some areas, they simply would not get what was advertised. At this point this is completely subject to interpretation whether this is right or wrong.
Proponent for this is right: They can lower your prices because of the overbooking principle. 400 people may be on a line that can only support 100 people simultaneously. However, 99% of the time, only 90 people simultaneously use the line. The chances of these people not getting what they paid for is honestly never going to happen, even if it does happen seldomly.. theysuck it up because they're saving a ton of money based on what ISPs would otherwise have to charge them.
Proponent for this is wrong: Even though it is statistically improbable for this to happen (with a properly run business), lets freak out and say this is wrong because there is a 3% chance that once a month for 30 minutes starting at 6:30 PM we will only be getting 70% of our promised bandwidth.
Some people face, and legitimately have a right to gripe about, the fact that some companies just don't run things right, and they overbook their lines to the point where you simply are not getting what you paid for a large portion of the time. At this point, and for these people, they have been wronged. However, this is not the case for many.
As far as sunk costs: costs are cost my friends. Just because it is sunk doesn't mean they can just keep install new lines and giving people more and more bandwidth. They must recoup these costs in order to continually provide service to you and others. This is a pretty basic concept and shouldn't even need to be stated.
[citation][nom]JPForums[/nom]The problem with many ISPs (including data services on mobile phones) is that they use reduction of service as the norm rather than the exception. [/citation]
This is a problem of competition, assuming I am understanding you right. Cable companies that have monopolies use this strategy. Again is it right? This is subject to interpretation and from a "power user," this really sucks because you are getting less for the same. Until a new company comes in and offers service, or once the service has been grossly reduced, there is no reason most ISPs are going to upgrade your services without charging you more. The deal here is, if they are the only company.. really you should be thankful to them for giving you high speed. Without them you would be on a likely very crappy service plan with another company.
[citation][nom]JPForums[/nom]If they can't support the rates they advertise, they should change the advertisement. If there are to many people using higher data rates on their network to support, expand the network, lower the data rate, or limit the number of users allowed to connect
at that rate. They could even post the number of spots and charge a premium to be one of the "elite" that gets to use the higher rates. Then they could use the premiums to expand their capabilities. Making this progression public would likely be beneficial as customers would feel like they are getting more for their money.[/citation]
I'm pretty sure most companies support what they advertise/tell you they are going to do. If they don't, you as the consumer have the power to change your service. That is, unless you got sucked into a shitty contract, which again you are to blame for that. Where I live, I get exactly what I pay for, I can upgrade to the "elite" packages if I want to pay more. Until (more) competition comes to you're area, you are at one or two high speed internet providers mercy.