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espaeth
Digital Plumber
Premium,MVM
join:2001-04-21
Minneapolis, MN
kudos:2
Reviews:
·Vitelity VOIP
reply to ArrayList

Re: Could be worse.

said by ArrayList:

I just don't see how using so much data has any relation with the cost of upgrading the plant. those costs should be spread across all the customers instead of the "top 5%" if the costs were spread across more customers the ISP would be able to upgrade far more often.

The problem is the usage distribution is so horribly skewed that you can't easily spread the costs around without making everyone's pricing skyrocket.

The top 1 percent of broadband connections is responsible for more than 20 percent of total Internet traffic. The top 10 percent of connections is responsible for over 60 percent of broadband Internet traffic, worldwide.
Source: »www.cisco.com/en/US/solutions/co···_WP.html

Part of the challenge is that technology upgrades are cheap, but capacity upgrades tend to be expensive.

What I mean by that is if you had to build out a 6TB storage array 6-7 years ago, you would have spent a ridiculous amount of money on 750GB or maybe 1TB drives and had to get a special chassis and controller to handle all the drives and some type of RAID5/6 solution. Today you can build a screaming fast RAID10 array using basic motherboard interfaces, a standard chassis that typically supports 4 drives, and 3TB drives that are available dirt cheap at most retailers. If you can keep your demand somewhat in line with upgrades in technology that bring expansion of capacity, you can get the best "bang for your buck" as your grow your infrastructure.

If ISPs can defer capacity upgrades to line up with their technology refresh cycles, they can keep infrastructure costs reasonable as they expand capacity. Examples of this include Comcast, which is a company that has been able to bump the base package offering from 3m/128k in 2001 to 12m/2m today without altering the base price of the package much. (in fact, adjusting for inflation the price has actually gone down)


ArrayList
netbus developer
Premium
join:2005-03-19
Evanston, IL
Reviews:
·Comcast

said by espaeth:

The top 1 percent of broadband connections is responsible for more than 20 percent of total Internet traffic. The top 10 percent of connections is responsible for over 60 percent of broadband Internet traffic, worldwide.
Source: »www.cisco.com/en/US/solutions/co···_WP.html

Of course this is true. The majority of internet connections out there sit idle and hardly get used. This is why I feel there needs to be peak/off-peak limits.

said by espaeth:

If ISPs can defer capacity upgrades to line up with their technology refresh cycles, they can keep infrastructure costs reasonable as they expand capacity. Examples of this include Comcast, which is a company that has been able to bump the base package offering from 3m/128k in 2001 to 12m/2m today without altering the base price of the package much. (in fact, adjusting for inflation the price has actually gone down)

If inflation were to go down you would most certainly not see any change in the price.

I have to ask though, what kind of technology upgrades other than networking equipment does an ISP need? I would imagine that networking equipment/plant equipment and capacity would be the largest expenses other than labor costs.