Reviews:
 ·Shaw
 ·TELUS
| Overage price's seem a bit high? 1.25/gig, we know wholesale bandwidth doesn't cost much more than 10 cents/gig?
I guess though, this is aimed at curbing usage, and getting people to use less, rather then find ways for the customers to get access to more bandwidth. That way they can lower the load on infrastructure that already is in bad need of upgrading. |
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 koitsuPremium,MVM
join:2002-07-16
Mountain View, CA
kudos:14 | said by zod5000:1.25/gig, we know wholesale bandwidth doesn't cost much more than 10 cents/gig? I agree. These limits are absolutely outrageous; not even co-location providers charge that kind of over-usage, nor have that kind of 95th-percentile cap.
I mean, the most expensive tier has a 95GByte/month cap?! Completely unreasonable. Rogers should multiply the cap amounts by 4, or at bare minimum, 2. |
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openbox9
join:2004-01-26
Alexandria, VA
kudos:2 | said by koitsu:not even co-location providers charge that kind of over-usage, nor have that kind of 95th-percentile cap. Considering ISPs providing last-mile service have additional infrastructure expansion/maintenance costs and larger support tails than co-lo facilities, the overage premiums are justifiable IMO. |
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 insomxPremium
join:2003-01-26
Canada | Considering Rogers has been given grants by the govenment to expand their infrastructure, these overage prices are NOT justifiable. |
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 espaethDigital PlumberPremium,MVM
join:2001-04-21
Minneapolis, MN
kudos:2
 ·Clear Wireless
| reply to zod5000
said by zod5000:1.25/gig, we know wholesale bandwidth doesn't cost much more than 10 cents/gig? You can't buy bandwidth per GB from carriers, just like you can't build a highway per car. Network capacity is measured in bits per second, just as highways are sized by number of lanes.
Cost per GB is a contrived number based on one month of perfect utilization. The base unit for most network bandwidth purchases today is 1mbps, and typical costs vary from $10-$35/mbps depending on market and carrier. So 1mbps / (8bits/byte) = 125kilobytes/sec. 125KB * 60sec/min * 60min/hr * 24hr/day * 30days/mo = 324GB Take an average price of $15/mbps and divide that out by 324GB, and you get a cost of about $0.05/GB. But what if you need to move 325GB? Then you're buying another mbps of traffic, and it's $30/325GB $0.09/GB
The problem is -- utilization isn't perfect and bandwidth needs to be purchased (by rate) to meet peak demand. If you need 6gbps to meet peak demand, you have to buy 6gbps worth of capacity. Just like with roads, you're paying for that infrastructure whether you're using it or not, which is why the wholesale per-GB pricing numbers thrown out on these forums are useless. |
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 wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | reply to zod5000
said by zod5000:we know wholesale bandwidth doesn't cost much more than 10 cents/gig? 10 cents a gig?? I can assure you that IP access is not 10 cents a gig from any carrier in the US (or the world). However, you can get it for $10 a gig if you are buying (generally) 10G and above.
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Have YOU thanked a soldier today? If not, think about doing it as you speak ENGLISH this memorial day. God Bless America, and God Bless our troops.
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| reply to openbox9
said by openbox9:Considering ISPs providing last-mile service have additional infrastructure expansion/maintenance costs and larger support tails than co-lo facilities, the overage premiums are justifiable IMO. To the tune of at most $1.00/GB, but numbers like $2.50+ per GB are totally out of line with the realities of providing that much transfer.
$2.50/GB of overage translates to about $810/Mbps of bandwidth used... $5.00/GB is over $1600/Mbps. Those numbers are way out of line with the realities of providing access. |
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| reply to wifi4milez
said by wifi4milez:said by zod5000:we know wholesale bandwidth doesn't cost much more than 10 cents/gig? 10 cents a gig?? I can assure you that IP access is not 10 cents a gig from any carrier in the US (or the world). However, you can get it for $10 a gig if you are buying (generally) 10G and above. The poster meant 10cents/GB, not 10cents/gigabit, which is in line with transit costs. |
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espaethDigital PlumberPremium,MVM
join:2001-04-21
Minneapolis, MN
kudos:2 Reviews:
·Clear Wireless
| said by NetAdmin1:The poster meant 10cents/GB, not 10cents/gigabit, which is in line with transit costs. That's in-line with transit costs if you are assuming that every megabit you purchase is 100% utilized over the month and you ignore all of the last mile costs. |
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2 edits | said by espaeth:said by NetAdmin1:The poster meant 10cents/GB, not 10cents/gigabit, which is in line with transit costs. That's in-line with transit costs if you are assuming that every megabit you purchase is 100% utilized over the month and you ignore all of the last mile costs. Try reading what I typed again... The post deals purely with transit costs. The OP and the poster that was replied were both speaking in terms of transit costs alone.
Before jumping in and trying to correct people, it is best to have some idea of what is being talked about. |
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espaethDigital PlumberPremium,MVM
join:2001-04-21
Minneapolis, MN
kudos:2 Reviews:
·Clear Wireless
| said by NetAdmin1:Try reading what I typed again... The post deals purely with transit costs. The OP is trying to relate ISP per-GB charges to transit costs, when they aren't directly related.
I understand you were speaking specifically to the transit costs, but you're also trying to embrace the absolutely meaningless per-GB cost in transit costs. If I have a 100mbps transit connection billed @ $15/mbps, and I move 30GB total for the month my per-GB cost is $50/GB. It's only if I max the entire connection out at 100mbps for the entire month that I can get the cost down to the per-GB pricing you're talking about. ($1500/32,400GB = $0.05/GB) |
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| said by espaeth:I understand you were speaking specifically to the transit costs, but you're also trying to embrace the absolutely meaningless per-GB cost in transit costs. Actually, it isn't meaningless to try to derive a cost per GB in terms of transit to create a baseline number for what cost per GB should be at the access portion of the network.
To claim that any terrestrial provider in the US or Canada has infrastructure costs to justify a 10+ fold increase in price per GB requires some serious justification, justification that has yet to be produced.
If I have a 100mbps transit connection billed @ $15/mbps, and I move 30GB total for the month my per-GB cost is $50/GB. That is assuming you are paying for a 100Mbps transit connection at a CIR of 100Mbps and aren't billed with 95th percentile. Most transit providers are selling 95th percentile billed, in most cases, to the nearest Mbps, so your cost is $.50/GB. If the provider were to use billing to the nearest .5 Mbps, your cost would be $.25/GB.
Of course, when you factor in peering arrangments, cost per GB, as derived from the costs providers pay out, come down even more. |
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espaethDigital PlumberPremium,MVM
join:2001-04-21
Minneapolis, MN
kudos:2 Reviews:
·Clear Wireless
| said by NetAdmin1:Actually, it isn't meaningless to try to derive a cost per GB in terms of transit to create a baseline number for what cost per GB should be at the access portion of the network. You're trying to treat bandwidth like a physical good, which it's not. The standard economic forces of supply and demand determine pricing. If I have a demand of 5mbps against a 10,000mpbs head end circuit, my demand:supply ratio is significantly greater than, say, a DOCSIS downstream channel where it's 5mbps out of 38.
To say it costs the same to move 5mbps at both the head-end and the last mile doesn't line up with reality.
said by NetAdmin1:To claim that any terrestrial provider in the US or Canada has infrastructure costs to justify a 10+ fold increase in price per GB requires some serious justification, justification that has yet to be produced. If capacity at the edge was equal to capacity at the head-end maybe equality would be an argument, but it's not.
said by NetAdmin1:That is assuming you are paying for a 100Mbps transit connection at a CIR of 100Mbps and aren't billed with 95th percentile. Most transit providers are selling 95th percentile billed, in most cases, to the nearest Mbps, so your cost is $.50/GB. If the provider were to use billing to the nearest .5 Mbps, your cost would be $.25/GB. It doesn't work that way. Even under 95th percentile billing you still have to commit to a level of bandwidth purchase and then get hit with a significantly higher overage charge. Your commit level influences how much infrastructure your upstream will build out; anything above your commit level has absolutely no guarantee of availability, and budget carriers like Cogent run into drops above commit all the time because of how hot they provision their network. |
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| said by espaeth:To say it costs the same to move 5mbps at both the head-end and the last mile doesn't line up with reality. Which is why pricing per GB is higher to the end user than it is to the provider at the network border... However, you use you cost of transit bandwidth to determine your cost of access bandwidth.
If capacity at the edge was equal to capacity at the head-end maybe equality would be an argument, but it's not. There is no assumption that access bandwidth is equal to distribution or transit bandwidths... The assumption is that transit bandwidth is cheaper because there is more of it available when compared to access bandwidth. However, the cost differential is not 10 fold.
Even under 95th percentile billing you still have to commit to a level of bandwidth purchase and then get hit with a significantly higher overage charge. Yes, and no one with a 100Mbps CIR is going to be transferring only 30GB in a month. Your example is unrealistic. Additionally, you didn't say that you had a 100Mbps CIR in your example, so I assumed you had a 100Mbps burstable link. |
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openbox9
join:2004-01-26
Alexandria, VA
kudos:2 | reply to NetAdmin1
I'm sure the prices were chosen to incentivize upselling to more lucrative tiers. Additionally, customers destined for "entry" level tiers may very well consume a larger proportion of support than the "experts" that roam forums such as DSLR. This could easily justify more expensive usage costs for entry level tiers. |
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