Internet speed guarantees must be realistic, says Ofcom
In a weird way, this is the same problem that banks face.<p>Fractional reserve banking is actually in society&#x27;s best interests: it&#x27;s fine if the bank takes $100 in deposits, then loans out $80 or $90, rather than just having the money sitting in a vault doing nothing.<p>In the same way, it&#x27;s probably better for the <i>overall efficiency of communications</i> for ISPs to oversell capacity and then allow bursting on top, rather than not overselling and wasting bandwidth when there&#x27;s no congestion.<p>They face the same problem though: banks have an incentive to lower reserves until the smallest shock will bankrupt them, and ISPs make more money by overselling past what is wise or reasonable.<p>Same solution: for banks we regulate margin requirements, and for ISPs we should regulate how much they can oversell.