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>> Why are consumers okay with paying a metered fee for electricity, water, and gasoline? > They're not. But normally they don't have a choice. Wait, what? Says who? I certainly don't speak for everyone, but I'm perfectly happy paying just for my usage of these things. I think the difference is predictability and that the costs aren't astronomical if you have a high-usage month. If it's colder than usual, I'd perhaps expect to pay another 10% on my utility bill. That's reasonable and not a hardship. If I were to spend, say, $30/mo on a plan with 500 minutes of voice calling, and went 100 minutes over, but was only charged, say, $6 for that overage, I'd have no problem with that (because 30/500=0.06 and 0.06100=6). But instead I get charged something like $20, which is way out of proportion to the overage. That's* the objection. And I think part of it is related to an understanding of actually "using something up". When I use more electricity, I know that I actually used something up: that extra power came from more coal being burned, or more water falling from a dam, or something of that nature. When I use more water, I know that my use of it drained a reservoir a little bit more than it otherwise would. I used up a physical good, and I'm paying for that use. If I use more than what a regulator has decided is my "fair share", I might pay a premium for that extra (many utilities have tiered pricing), but I'm ok with that because I do recognize I'm using more than usual, and the added cost of the higher tier isn't unreasonable or burdensome. But the cost of me spending 100 extra minutes on the phone costs the carrier basically nothing. Sure, if everyone did that in a month, perhaps it would strain the carrier's network (not that it would cause the carrier to spend capital on increased capacity; they'd likely be fine with more dropped/failed calls that month). In general, though, the marginal cost to the carrier when you use more minutes than your plan provides is near zero -- and yet the carrier charges an exorbitant markup for that overage. |