(IDG) -- Advocating the Pay-As-We-Go Internet (TM) is a dirty job, but somebody has to do it. And when I do, as I did here last week (see "Get into the mind flip and do the time warp with anticiparallelism," Sept. 14), disagreeable people throw back in my face how angry I am with the telephone monopolies, which meter telephone calls. Telopolies are giving network usage metering a bad name.

Many of life's other essentials are metered. Water and electricity are metered, for example. We even pay for highways as we go, by the mile, paying metered gasoline taxes and tolls at carefully spaced booths.

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But why pay as we go? Why pay e-postage? Why pay for downloaded Web pages? Why pay for gigapacket meters? Because flat-rate billing really works only when the flat rates are high.

Some say most telco costs are for billing, not bandwidth. And since bandwidth will soon be free, there's no sense building all the infrastructure that would be needed for Internet metering and usage billing. Flat rates will suffice.

Well, it's probably not true that most telco costs go for billing. And even if it is, bear in mind that for decades telcos have been increasing their costs to increase their regulated profits.

No, the problem with telco metering is not the metering. It's the rates. They've been ripping us off, and we should be angry about that, not about the metering.

Those who say bandwidth will soon be free have some strong arguments. Semiconductor densities are doubling every 18 months, photonic bandwidths are doubling every 12, and wireless bandwidths are doubling every nine.

To these arguments, I say "great!" but Internet traffic is now doubling every four months. The number of Internet users is going up. The time each of them spends on the Internet is going up. The bandwidth consumption of new applications is going up. Do the multiplication.

It's great that bandwidth is getting cheaper, but like memory, it will always be scarce -- it's price elastic. We have economics to deal with scarcity. The Internet can no longer be an economics-free zone.

Metering Internet usage and charging for consumption is what we need in the next-generation Internet. Paying as we go will deter waste, and the prices will serve as distributed coordinators between supply and demand.

The first Pay-As-We-Go systems we need are for settlements among Internet service providers. Sure, telcos settle for carrying one another's calls, but that's not their problem. Their problem is a lack of competition, not settlements. We need settlements among our thousands of competing ISPs, or we'll likely lose them and be stuck getting our Internet from the telopolies.

The second Pay-As-We-Go systems we need are for billing Internet users. As users consume various resources, microcharges will be accumulated and bills periodically sent. ISPs could do this, but it might be better to use separate entities -- the way credit cards gather charges from many merchants for many holders.

The third Pay-As-We-Go systems we need are for e-postage. Competing e-mail servers will have to pay competing ISPs for the bandwidth consumed to transmit their mail; they will have to settle up with one another for messages forwarded; and they will have to send e-postage microbills to individual users. E-postage will deter spam while paying for Internet capacity and the timely evolution of e-mail services.

The fourth Pay-As-We-Go systems we need are for Web downloads. Like anybody else generating Internet traffic, Web servers will pay traffic costs. They will also incur server costs. And of course they will want to bill for the value of the content delivered. Web server bills will join those ISPs and e-mail carriers in the Internet's competing microbilling systems.

Now, once we have a Pay-As-We-Go Internet and the bills to come with it, who will pay them?

Well, a lot of Internet bills will be paid by Internet users the way they now pay for food, water, clothing, housing, transportation, and other necessities. But a lot of these bills will be paid by advertisers, which now pay for most of television -- strong evidence that we don't want them paying all of our bills.

Then there are the proverbial have-nots.

Won't a Pay-As-We-Go Internet leave the have-nots out of the Information Age? Well, we can argue about that and then when we decide, let's not make the same mistake that we did with the telopolies. It's better to give subsidies to the have-nots to pay as they go on the Internet.

Internet pundit Bob Metcalfe invented Ethernet in 1973 and founded 3Com in 1979. Send e-mail to metcalfe@idg.net. See http://www.idg.net/metcalfe.