Re: Pay-As-You-Use High-Speed Internet?
Also, you could also take the approach of wiring a whole building for Internet connectivity through that model, like Intellispace does. -- Jonathan Daniel Senie wrote:
At 05:22 PM 5/14/2004, you wrote:
Hello Fellow NANOG'ers,
I was just thinking about this - tell me if it sounds reasonable? The company that I work for developed a piece of technology which, through rate-limit statements, allow customers to buy/sell bandwidth "on demand". Now, I was thinking: "Why can't we take this technology that we've tested successfully in a colo environment and adapt it a little bit for personal/buisness-class ISP's to allow them to bill for the bandwidth that a customer uses, and only that with the exception of a base monthly fee (to cover the DSL/T1 loop, e-mail services, support, etc.) of a few dollars.
The access line (T-1, etc.) loop charge is substantially larger than the bandwidth charge. Get the phone companies to price the lines better, and it might make sense.
Personally, I would like to see a senario where everyone just pays for what they use - it would be a much better system for allowing people who don't neccessarily need to get on the Internet at high-speed, get on high-speed which will not only increase revenue for the ISP's, but also for the customer who can now use DSL/T1 access in a much more effective way.
Questions? Comments? Suggestions?
-- Jonathan
-- Jonathan M. Slivko Network Operations Center Invisible Hand Networks, Inc. help@invisiblehand.net 1-866-MERKATO (USA) 1-812-355-5908 (Intl) <http://www.invisiblehand.net>
-- Jonathan M. Slivko Network Operations Center Invisible Hand Networks, Inc. help@invisiblehand.net 1-866-MERKATO (USA) 1-812-355-5908 (Intl) <http://www.invisiblehand.net>
From the end users' perspective, we've got pretty much the same story. They're unlikely to save more than a few dollars if they don't use the connection at all, and they'll have to pay more if they do. What's in it for them? If the end user is already paying the $30-50/month you suggest
For an idea to catch on, it often helps for there to be a clear benefit to doing things the new way rather than the old way (or at least, it needs some good marketing...). In this case, it's not clear to me where the benefit is. A lot of the cost of residential connections is in support, and in the cost of the physical connection, whether it's used or not. From the ISP's perspective, even if the average customer's use were to drop considerably, it probably wouldn't lead to a huge reduction in their costs, so they wouldn't be able to lower the base price of an unused circuit much below what it already is. While it might be nice to be able to get more than they're currently getting from customers who are heavy users, the heavy users would be unlikely to pay more, given that they could get service for the same flat rate from the ISP's competitors. that they would pay for the loop, then they're currently getting the bandwidth for free. Why would they want to start paying more? The situation for users of much bigger connections, where we're talking bills of thousands or tens of thousands of dollars per month, instead of $30-50, is quite different. Metro ethernet and OC-whatever connections generally are billed at 95th percentile utilization, which is a form of pay as you use. -Steve On Fri, 14 May 2004, Jonathan M. Slivko wrote:
Also, you could also take the approach of wiring a whole building for Internet connectivity through that model, like Intellispace does.
-- Jonathan
Daniel Senie wrote:
At 05:22 PM 5/14/2004, you wrote:
Hello Fellow NANOG'ers,
I was just thinking about this - tell me if it sounds reasonable? The company that I work for developed a piece of technology which, through rate-limit statements, allow customers to buy/sell bandwidth "on demand". Now, I was thinking: "Why can't we take this technology that we've tested successfully in a colo environment and adapt it a little bit for personal/buisness-class ISP's to allow them to bill for the bandwidth that a customer uses, and only that with the exception of a base monthly fee (to cover the DSL/T1 loop, e-mail services, support, etc.) of a few dollars.
The access line (T-1, etc.) loop charge is substantially larger than the bandwidth charge. Get the phone companies to price the lines better, and it might make sense.
Personally, I would like to see a senario where everyone just pays for what they use - it would be a much better system for allowing people who don't neccessarily need to get on the Internet at high-speed, get on high-speed which will not only increase revenue for the ISP's, but also for the customer who can now use DSL/T1 access in a much more effective way.
Questions? Comments? Suggestions?
-- Jonathan
-- Jonathan M. Slivko Network Operations Center Invisible Hand Networks, Inc. help@invisiblehand.net 1-866-MERKATO (USA) 1-812-355-5908 (Intl) <http://www.invisiblehand.net>
-- Jonathan M. Slivko Network Operations Center Invisible Hand Networks, Inc. help@invisiblehand.net 1-866-MERKATO (USA) 1-812-355-5908 (Intl) <http://www.invisiblehand.net>
-------------------------------------------------------------------------------- Steve Gibbard scg@gibbard.org +1 415 717-7842 (cell) http://www.gibbard.org/~scg +1 510 528-1035 (home)
For an idea to catch on, it often helps for there to be a clear benefit to doing things the new way rather than the old way (or at least, it needs some good marketing...). The benefit would be better bandwidth management for the ISP. For example, in our building where we're lit, we have 50 apartments currently running this exact type of scenario on an Ethernet platform to a T1 going into the building.
In this case, it's not clear to me where the benefit is. A lot of the cost of residential connections is in support, and in the cost of the physical connection, whether it's used or not. From the ISP's perspective, even if the average customer's use were to drop considerably, it probably wouldn't lead to a huge reduction in their costs, so they wouldn't be able to lower the base price of an unused circuit much below what it already is. While it might be nice to be able to get more than they're currently getting from customers who are heavy users, the heavy users would be unlikely to pay more, given that they could get service for the same flat rate from the ISP's competitors. As for your point of the major cost for an ISP would be support. That is where I beg to differ, in my own experience working for this company on
Steve, As for your point of the major cost for an ISP would be support. That is where I beg to differ, in my own experience working for this company on this project, it has required very little time to do actual support work to the end-user, provided that the Internet connection actually works. Steve Gibbard wrote: this project, it has required very little time to do actual support work to the end-user, provided that the Internet connection actually works. But, to a heavy user, a faster connection (greater than 1.5Mbps downstream, with a higher upstream than most DSL companies provide in their residential packages)would also be worth paying for. For example, would an office with 100 employees rather work on a single T1 line for which they are paying $1000/month whether they use it or not. Or, would they want to buy bandwidth for the 8-9 hours that they are actually there during the week. Currently, as I type this, the actual bandwidth market in the building is sitting (and has been sitting for quite awhile) at $1.22 per kbps sustained for a month. So, if you don't use it the whole entire month (as your billed in 5 minute increments of actual usage), then your cost becomes significantly less. With our model, you wouldn't be paying for what you don't use. This has been the way that we lit the apartments in the building as well as how we operate our colocation market.
From the end users' perspective, we've got pretty much the same story. They're unlikely to save more than a few dollars if they don't use the connection at all, and they'll have to pay more if they do. What's in it for them? If the end user is already paying the $30-50/month you suggest that they would pay for the loop, then they're currently getting the bandwidth for free. Why would they want to start paying more?
I'm saying bandwidth at market rate + a constant fee for the T1 loop.
The situation for users of much bigger connections, where we're talking bills of thousands or tens of thousands of dollars per month, instead of $30-50, is quite different. Metro ethernet and OC-whatever connections generally are billed at 95th percentile utilization, which is a form of pay as you use.
Yes, but as I wrote before, this is not a 95th percentile environment, it's actual usage. We are actually AGAINST 95th percentile. It seems to work quite well for the building that we've already wired with this technology.
-Steve
-- Jonathan M. Slivko Network Operations Center Invisible Hand Networks, Inc. help@invisiblehand.net 1-866-MERKATO (USA) 1-812-355-5908 (Intl) <http://www.invisiblehand.net>
On Fri 14 May 2004 (18:44 -0400), Jonathan M. Slivko wrote:
Steve,
As for your point of the major cost for an ISP would be support. That is where I beg to differ, in my own experience working for this company on this project, it has required very little time to do actual support work to the end-user, provided that the Internet connection actually works.
Then you haven't worked for an ISP selling consumer DSL. Support eats margins more than any other single factor - transit is getting cheaper, equipment is getting cheaper in terms of Euros/Mb/sec. Customers are getting more demanding and having more problems than ever, for which they pick up the phone and expect support. -- Jim Segrave jes@nl.demon.net
On Fri, 14 May 2004, Steve Gibbard wrote:
In this case, it's not clear to me where the benefit is. A lot of the cost of residential connections is in support, and in the cost of the physical connection, whether it's used or not. From the ISP's perspective, even if the average customer's use were to drop considerably, it probably wouldn't lead to a huge reduction in their costs, so they wouldn't be able to lower the base price of an unused circuit much below what it already is. While it might be nice to be able to get more than they're currently getting from customers who are heavy users, the heavy users would be unlikely to pay more, given that they could get service for the same flat rate from the ISP's competitors.
This could be interesting for niche markets I imagine. Many smaller ISPs are locked into a reseller relationship with a handful of DSL wholesalers (Covad, and perhaps the local ILEC) and they can't get in with their local cable companies. You're given a product and specs and that's that. It seems the DSL folks finally realized that cable is now much faster, and it actually works well when engineered correctly. So now SBC is offering "up to" 6Mb/s down, and Covad has apparently let loose a 6.0/768 product with Speakeasy, which I assume means that will be available to less favored resellers. I would think it would be a nice option for niche players to offer both traditional "all you can eat pricing" as well as a metered service that includes X GB of transfer. The idea here is that you let the pigs pay full price so they can P2P their brains out, but those that know they don't *need* 6.0/768 24/7, but would sure *like* it when pulling down the occasional ISO or MS patches. I know I would jump on a service that gave me a "fat pipe" that had limited transfer; it's sad to log in to your DSL modem and see that the line is capable of 8Mb/s down and you're being throttled to 1.5MB/s. P2P traffic aside, a faster connection doesn't necessarily mean that you'll transfer more data, it just means you'll get the data you want faster. Unless of course you augment your web browsing skills with a speed reading clas... Charles
-Steve
On Fri, 14 May 2004, Jonathan M. Slivko wrote:
Also, you could also take the approach of wiring a whole building for Internet connectivity through that model, like Intellispace does.
-- Jonathan
Daniel Senie wrote:
At 05:22 PM 5/14/2004, you wrote:
Hello Fellow NANOG'ers,
I was just thinking about this - tell me if it sounds reasonable? The company that I work for developed a piece of technology which, through rate-limit statements, allow customers to buy/sell bandwidth "on demand". Now, I was thinking: "Why can't we take this technology that we've tested successfully in a colo environment and adapt it a little bit for personal/buisness-class ISP's to allow them to bill for the bandwidth that a customer uses, and only that with the exception of a base monthly fee (to cover the DSL/T1 loop, e-mail services, support, etc.) of a few dollars.
The access line (T-1, etc.) loop charge is substantially larger than the bandwidth charge. Get the phone companies to price the lines better, and it might make sense.
Personally, I would like to see a senario where everyone just pays for what they use - it would be a much better system for allowing people who don't neccessarily need to get on the Internet at high-speed, get on high-speed which will not only increase revenue for the ISP's, but also for the customer who can now use DSL/T1 access in a much more effective way.
Questions? Comments? Suggestions?
-- Jonathan
-- Jonathan M. Slivko Network Operations Center Invisible Hand Networks, Inc. help@invisiblehand.net 1-866-MERKATO (USA) 1-812-355-5908 (Intl) <http://www.invisiblehand.net>
-- Jonathan M. Slivko Network Operations Center Invisible Hand Networks, Inc. help@invisiblehand.net 1-866-MERKATO (USA) 1-812-355-5908 (Intl) <http://www.invisiblehand.net>
-------------------------------------------------------------------------------- Steve Gibbard scg@gibbard.org +1 415 717-7842 (cell) http://www.gibbard.org/~scg +1 510 528-1035 (home)
participants (4)
-
Charles Sprickman -
Jim Segrave -
Jonathan M. Slivko -
Steve Gibbard