Next, Travail, and Net Neutrality

When they opened their second restaurant, Next, in 2010, restaurateurs Grant Achatz and Nick Kokonas decided to try something new with their customer payment model. Next was designed as a prix fixe concept: everyone was to be served the same menu – there were no a la carte options. Sure, occasionally there were supplements available, and there were tiered wine pairings as well (non-alcoholic drinks and sodas, a standard wine selection, and a “reserved” pairing option which, as you might expect, was significantly more expensive), but the majority of patrons would be paying the same price for their meal. So why not get rid of the hassle and awkwardness of delivering a check and processing a payment? Instead of taking a reservation up front and receiving payment after the meal, Next Restaurant started selling tickets for their meals.

This idea turned out to be a two birds, one stone type of innovation. Not only did it make for a smoother dining experience – one could budget and pay in advance, so when the meal was over they could stay or leave at their leisure – it also cut down on food waste. Most people don’t consider the fact that a cancelled reservation often costs the restaurant money. “Hours go into producing what might be a two-and-a-half bite course” at Alinea, says Achatz. “From the moment that (cooks) walk in the door at 6 a.m. and they put a pot of soy milk on the induction burner, and they start to pull the sheets of yuba and roll them, somebody filleting the shrimp, somebody pickling the onion, somebody making the orange taffy, right up to the point when it’s first served in the restaurant? Twelve hours. For one bite. Twelve hours, five people. That’s absurd.”  Alinea is certainly not alone in this approach: fine dining restaurants everywhere spend this kind of time on their dishes, and that makes it imperative to know exactly how much needs to be produced on a day-to-day basis. If your cooks don’t make enough of something, there won’t be enough to give to each diner. If they make too much of something, it will have to be stored for a future service or thrown out. Selling tickets lets you know exactly how many people will be coming to eat that night, making the margin of error that much smaller.

Recently, the Robbinsdale hotspot Travail embraced this system and started issuing tickets of their own. Travail also adopted a variable pricing feature (Next does this as well): off-hours reservations would be available at a discount. If a group is willing to come early, or start their meal later, they might save as much as $20 per person on the exact same meal. (The logic of this is straightforward, of course: peak dining hours will be full regardless, and people who might have stayed home otherwise are enticed by the savings. And spendthrifts can likewise plan accordingly.)

Most people, at least among those that actually care about such things, saw this for the benefit that it is. Some people took to complaining about it immediately. Some saw it as pretentious: acceptable for a culinary superstar like Grant Achatz, but unacceptable for the relatively unknown Mike Brown and James Winberg. But the most peculiar complaint was for those who saw the price variance not as a discount for off-hours diners, but as a surcharge on normal people. “Why should I have to pay more just because I want to eat at a normal time?” asked one commentator. I wonder, of course, if he thinks that it’s acceptable for Café Latte to sell its day-old cake at a discount, or if he views full-priced cake as a surcharge on people who like to eat fresh. What should have been a win-win got painted as a shameless cash grab. If everyone pays the same price, more often than not, they’re going to be paying the higher price.

Now allow me to shoehorn the net neutrality discussion into these examples. Net neutrality is a complex issue with a number of facets, and I am not educated or informed enough to comment on all of them. What I do want to comment on, though, is possibly the smallest element of this whole discussion: tiered service. John Oliver summarizes the issue like this: “Ending net neutrality would allow big companies to buy their way into the fast lane, leaving everyone else in the slow lane.”

This is flawed logic. Net neutrality dictates one of two outcomes: either everybody will get (and therefore pay for) “fast lane” service, whether they have the need for it or not, or everyone will be stuck in the slow lane. Also, why there would only be a fast and slow lane, Oliver never explains. If only certain companies, say Netflix, have access to that service, then their customers – stuck in the slow lane – won’t be able to get full use of the products they pay for. The market self corrects in this way. In the end, this is like arguing that everybody should pay the same price for their meal at Travail, or their cake at Café Latte. They have in mind to pay the smaller price, but they should expect the bigger bill instead.

Next and Travail offer a fast-lane, slow-lane options for their reservations. I see this as a good thing. But this model only works because they are not the only game in town: I don’t have to eat at either restaurant. The way to keep the Internet free is to introduce more competition, not to give strict regulatory controls to the FCC. The FCC, you might recall, is head by a man named Tom Wheeler, who used to be the top lobbyist for certain cable and wireless companies. As John Oliver put it, “The guy who used to run the cable industry’s lobbying arm is now running the agency regulating it.” Doesn’t it seem a little absurd, then, to give him more power to do so by letting the government regulate internet service?

The aforementioned yuba, shrimp, orange taffy dish. Twelve hours!

The aforementioned yuba, shrimp, orange taffy dish. Twelve hours!

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