ISPs "exaggerate the cost of data"
pcpro.co.uk
pcpro.co.uk
These decision-makers would say that "Our costs for providing backhaul / transport / whatever is going up - no matter how much we upgrade, its capacity is exhausted either immediately or very quickly. We have to recover that cost somehow, or we won't be able to continue providing any service."
However, they don't understand that their equipment and transport are constrained at the level of "bits per second at peak" and not "sum of bytes transferred during a billing period." So, they end up making bad decisions about "charging $x per GB after y GB transferred per month."
what would that look like if you had the 'don't worry about it' quota with a more reasonable price on overages? I don't know. It used to be that you'd set the 'don't worry about it' quota a little too high, 'cause with the unreasonable cost of overages, most people would error on the side of not using it all.
(metering costs more for both the provider and the customer, but mostly the customer; the provider side can be automated, so it's largely a fixed cost. The customer usually prefers a flat rate over a variable rate, even if the variable rate was slightly cheaper on average, because variable rate billing means that the customer needs to pay attention, which is expensive.)
When dealing with more savvy customers and selling amounts of bandwidth that matter, charging on the 95th percentile is pretty common.
That said, any major ISP who claims it costs them more than a few pennies per gigabyte to move traffic is flat out lying.
Not lying, but confused (see my comment below) and measuring at the wrong margin.
This would be like saying the president of ford motor company doesn't understand the difference between the EPA 'city' and 'highway' mileage numbers, and how to game each. Sure, if it's convenient, he might claim ignorance to the press, but there's no way he doesn't understand something that central to the business.
Luckily, I think competition is going to be making things better for the Australian ISP consumer. That, and recent improvements/additions in undersea cables.
I decided I prefer a limited plan where I know what service level (particularly latency and throughput) I can expect. For instance, plans with Adam and Internode are not that much more than a TPG plan for more usage than I'll forseeably use (I get 500gb a month or so at 20mbps + VOIP for $100), but the difference in gaming latency and actual speeds are both considerably more stable and faster than friends on TPG.
Given that your plan is 60% more than mine, I'll gladly pocket the difference and live with the minor problems I've had. As another poster mentioned, I chose to vote with my wallet. Generally small quotas + absurd off-peak times (where the majority of the quota is allocated) make my blood boil and I'll support anyone who helps break up the status quo.
Then again, I suppose you could argue cost per GB = integral(download speed * time) / cost per month, so 1GB at slow speeds is costing me more in terms of time-bandwidth product at peak rates than otherwise. Soft data caps and peak-time QoS might also be happening behind the scenes, skewing matters more.
Let's say you're an ISP and you have a 10Gbps connection to the outside world, and the routers etc. that can keep up with that speed.
To a first approximation, your costs to serve up 10Gbps to all the customers in your area is 0 (you've got to pay for electricity and engineers and etc, but this doesn't vary with user activity).
If your customers in your area all queued up nicely and downloaded stuff at full rate, never overlapping with each other, you could transfer 10Gbps * 1 month for basically nothing.
However, your customers all want to do stuff at the same time, and thus contend with each other for a slice of that 10Gbps. If you want to serve all of their requests, you're going to have to spring to upgrade your total capacity.
If you don't own your own fiber, you have to rent a link from someone else, or if you do and there's no more available you have to physically come up with more (and pay to dig up the road and etc.). Now your routers and etc. might not be able to keep up with your new backhaul speed, and you have to upgrade those...
You really want to measure "Marginal cost of +x Kbps during the busiest typical hour."
I'd be thrilled if someone tried it, though. It's more honest and more likely to address bad user experiences than arbitrary "bytes transferred per month caps."
Still, at least with my phone I have my choice of carriers and will be switching from AT&T to Verizon this month. I don't have that same choice in choosing a "high speed" ISP... I wish some comcast competition would move into town, the consumer might end up with a better quality product.
This is a dangerous fallacy exploited by entities like giant ISPs and the MPAA to push debate toward their desired outcomes. If everyone believes that "the truth lies somewhere between," then all an extreme actor needs to do is argue for extreme position A against the status quo B, and public opinion (and political discourse) automatically shifts to (A+B)/2 every time the extreme actor raises the issue. In reality, the truth may be exactly B, but because of a well-intentioned but fallacious desire to compromise, opinion and policy are skewed away from the truth.
The classic example of this fallacy is this: "Some say the sun rises in the east. Some say it rises in the west. The truth must lie somewhere between."
https://secure.wikimedia.org/wikipedia/en/wiki/Argument_to_m...
https://secure.wikimedia.org/wikipedia/en/wiki/Overton_Windo...
Even for ISPs running their own network, such as BT, [ISP CTO] Davies claims the figures of €0.01-0.03 per GB are "rubbish". "It's an order of magnitude greater than that," he claimed.
This is coming from a guy claiming that the "existing smartphone data tariffs of around €10 per GB" are too low. They're profit-seeking, and relying on their regulators to be as bad at math as they are.
Right. So let's start seeing those prices get in the 0.10~0.30€/GB now shall we?
I'd be interested in what an independent investigation would reveal.
Actually, does anyone know of a government funded ISP that makes this information public?
awesome, so it only costs about a quarter for a gigabyte. so i use about 20 GB a month. can i just pay 5 bucks a month? yeah, i didn't think so. i'm pure gravy for them, and what does comcast charge me for 4 to 10 Mbps? $70
and don't get me started about the fixed cost versus the variable cost—the variable cost is certainly not more than a few cents per GB but the fixed costs can be enormous.
i wish the internet was just a utility.
Recently net neutrality ended and now we have 250 GB/Month bandwidth caps as Comcast customers. I'm not worried about ever hitting that cap, but I am worried about the cap tightening over the next couple of years.
Everyone talks about Google and Facebook's control over their information, but I don't hear enough concern about ISPs' collective control over access to information.
I don't consider a bandwidth cap applied univerally to be a violation of net neutrality. There may or may not be a legitimate justification for it, but it's still treating all traffic the same. The violation would be if they charged/extorted sites like Netflix or YouTube to collect payments in exchange for traffic to them not counting against the cap.
For what it's worth, Comcast is already extorting (or at least trying to extort) Netflix for payments.
I'm still under a 100GB softcap right now (hardcap is 160GB, but I have to pay more for everything inbetween), I had to reinstall a machine and wipe out my Steam folder due to corruption.
I have about 300 games in steam, I blew through my cap once last month (in two nights, which are 50% off on the bandwidth counter) and this month I'm already at 96.8GB due to leaving Steam unattended for two nights again. And I'm nowhere near done re-downloading my games.
I don't normally come close to exceeding the cap, but once in a while in freak events it's very easy to blow through a few hundred gigs in a month. I miss uncapped connections.
Last year my quota was 60GB, 1-2 years before that it was 25, so on and so forth.
However, it claims forthcoming 4G technologies will significantly reduce those costs. "Forward-looking estimates which take account of the transition to LTE [Long Term Evolution], additional spectrum and traffic subscriber growth... puts the cost to the mobile network operators at under €1 per GB,"
Does that include the cost of the 4G licenses? In the UK these haven't been issued yet. If an operator pays £4bn [1] for the license and has 10m customers it needs to charge an extra £1 to every customer every month for 33 years to cover the cost of that license. That's not an inconsiderable amount before we begin talking about data.
[1] Costs based on UK 2000 licenses: http://news.bbc.co.uk/2/hi/business/727831.stm
The best way to end it is to slap them with a higher tax until they shut up.
But that would require both balls and common sense.
If congress makes the habit of slamming those companies which seeks subsidies with a tax, it will mean that companies have an incentive to shut up and compete on the open market.
This will improve the US economy and lower the deficit.
I pay my ISP. This is all the funding they will receive. If they start to collect from others, for me, it won't be my service anymore and they won't be responsive to my needs.