More Sidgemore on per-bit pricing
Sidgemore talks again: http://www.news.com/News/Item/0,4,29533,00.html?st.ne.fd.gif.a I'm sure this subject has been discussed at length here, but I still fail to see any benefit for per-piece pricing other than to the seller's revenue stream. I think it's always interesting that discussions of per-piece pricing always fail to mention the fundamental issue: provide a disincentive to the consumer to use the service. There is already per-piece pricing: 1.544Mbps of traffic costs $500 to $2000+/mo, depending upon how much the provider is counting on you to not use the service. However, in this case the burden is placed on the ISP to balance closing the sale with making money off of how much the customer actually uses the service. The thing I most distrust about people who talk about per-piece pricing is that in spite of the fact that it should end up costing lower-use customers less, for some reason it always ends up costing everyone more. Look at UUNet's pricing now (for 256K ASU, or something like that), versus the flat-rate price available from equivalent NSP's. Is that where things are going? Pete.
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use. Right now flat-rate pricing mostly assumes you're going to, within some statistical model, actually use the bandwidth you get, or certainly that someone buying a DS3 is going to use a lot more bandwidth, on average, than someone with a DS1. So if you usually only use, say, 25-75% of a DS1 then you'd be well-advised to only buy a DS1, even if 10% of the time you really have a good use for more. For example, imagine a company which wants to back up all the remote servers in their branch offices once per week, but would like to get it done as quickly as possible so it completes in the wee hours when the databases are quiescent. The rest of the time a DS1 might suffice for the usual email etc, but for those few hours, for the backups which run on Sunday night, a full 45mb/s would be useful. Under the flat-rate model that company would have to either buy a DS3 full-time, for around $50K/mo, or live with the DS1 for around $2K/mo (or possibly find some equivalent flat-rate option in between such as a 10mb, but that begs the point, they still can't pay for a T1 when they need a T1 and a T3 when they need a T3.) It all depends on the actual pricing models which might arise, which indeed is an arguable point, but without stating that assumption one can't argue the more general issue. For example, if I were to offer you either: a) DS1 $2K/mo b) DS3 $48K/mo c) per-bit DS3 $2K/mo/DS1-equivalent pro-rata per minute you'd be foolish, unless you have no control over your bandwidth usage (a whole other issue) not to take (c) if you occasionally need bursts of high bandwidth and were seriously considering going to the DS3; the most it can cost would be $48K/mo if you used that bandwidth 7x24 100%, but you almost certainly won't, so it can only cost you less. Now, it's admittedly not likely that someone wouldn't charge some sort of premium for the pro-rata bandwidth, perhaps it would actually be $2500/DS1-equivalent, but unless you really need the DS3 100% of the time (in which case you should buy the dedicated DS3) it's still likely to cost you a lot less. At a 50% utilization that $2500/mo pro-rata still only costs you around $30K/mo which is significantly less than the $48K/mo for committing to the whole pipe. As we move to, e.g., gigabit pipes I suspect this sort of pricing model will become more and more popular, or else not too many gigabit pipes will get sold. Buying 100% of a gigabit at the DS1 equivalent of, say, $2K/mo would come to about $2 million/gb/month. Customers certainly exist for $2M/mo connections, but not many of them. And the incremental cost of installing a pipe capable of gigabit bandwidth on demand is relatively very small (mostly just a piece of fiber and the boxes on each end), likely to be worthwhile even if the customer just uses $10K or more per month of that potential $2M/mo (pro-rata), or something like that much, much smaller than the $2M/mo. We're a case in point of that, we have a good amount of fiber to our offices here, NYNEX was happy to put lots of it in rather than ever trench the street again (they had the backhoes out for us on this urban street twice.) However, one remaining problem is the local loop, the RBOCs, who do like to price any service as if you are going to use 100% of it. Thus, to even buy a per-bit DS3 from an ISP you would still have to pay my RBOC around $5K-$10K/mo just for the local loop under the current model, which if nothing else raises the bar for such services. I think this is something Sidgemore is accounting for in his comments, however. -- -Barry Shein Software Tool & Die | bzs@world.std.com | http://www.world.com Purveyors to the Trade | Voice: 617-739-0202 | Login: 617-739-WRLD The World | Public Access Internet | Since 1989 *oo*
On Sat, Dec 05, 1998 at 02:38:57PM -0500, Barry Shein wrote:
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use.
The other possible effect is that you buy one of these, and then someone launches a DOS attack at you and you get the bill for it. The economic impact of this should not be underestimated. Per-bitrate pricing is a problem as long as the receiver pays for the receipt of transmissions they may not have solicited. -- -- Karl Denninger (karl@denninger.net) http://www.mcs.net/~karl I ain't even *authorized* to speak for anyone other than myself, so give up now on trying to associate my words with any particular organization.
On December 5, 1998 at 14:01 karl@denninger.net (Karl Denninger) wrote:
On Sat, Dec 05, 1998 at 02:38:57PM -0500, Barry Shein wrote:
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use.
The other possible effect is that you buy one of these, and then someone launches a DOS attack at you and you get the bill for it.
The economic impact of this should not be underestimated. Per-bitrate pricing is a problem as long as the receiver pays for the receipt of transmissions they may not have solicited.
Well, a paraphrase of the above is: We must engineer the net to keep the cost of criminal activities to a minimum so we can continue to avoid solving the underlying issue. That's not ridiculous, it may even be an unavoidable factor, but it's still somewhat sad. -- -Barry Shein Software Tool & Die | bzs@world.std.com | http://www.world.com Purveyors to the Trade | Voice: 617-739-0202 | Login: 617-739-WRLD The World | Public Access Internet | Since 1989 *oo*
On Sat, Dec 05, 1998 at 03:15:57PM -0500, Barry Shein wrote:
On December 5, 1998 at 14:01 karl@denninger.net (Karl Denninger) wrote:
On Sat, Dec 05, 1998 at 02:38:57PM -0500, Barry Shein wrote:
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use.
The other possible effect is that you buy one of these, and then someone launches a DOS attack at you and you get the bill for it.
The economic impact of this should not be underestimated. Per-bitrate pricing is a problem as long as the receiver pays for the receipt of transmissions they may not have solicited.
Well, a paraphrase of the above is: We must engineer the net to keep the cost of criminal activities to a minimum so we can continue to avoid solving the underlying issue.
That's not ridiculous, it may even be an unavoidable factor, but it's still somewhat sad.
Yep. It is sad. However, as long as we permit people to source traffic without cost and do so through proxies, this problem will exist. This is the primary argument AGAINST anonyminity on the Internet. Your activities, anonymous or not, are not without cost to others. The entire premise that you have a right to "anonymous speech" is based upon the fact that you do not directly harm others economically or otherwise be exercising it. However, on the Internet, this is simply not true. "Recipient pays" is a part of ALL Internet service, and always has been in one fashion or another - even when the majority of traffic was moved via modems in the 1980s and early 90s. Note that this is VERY different from the phone or postal service networks, both of which are nearly 100% SENDER pays. The exception is cellular service, and there it is a CRIMINAL ACT to call a cellular phone on an "unsolicited" basis - that is, to cost-shift where there is a reasonable probability that the cost is unwanted. Further all phone traffic is authenticated and can be traced to the source; "spoofed traffic" (beyond activity which is per-se criminal such as cloned cellular phones) doesn't exist. If all transmissions had to be identifyable as to their source, and chargeback capability was included (ie: if you spam me, I can charge the transmission back to you - likewise if you ping-flood me) then the problem would go away. But doing this requires strong authentication and non-denyability of the transmission itself, which flies in the face of those who scream for the ability to source anonymous traffic of one form or another. That engineering standards have not already stabilized to prohibit sourcing of traffic with spoofed source addresses, enforced by the providers themselves, is very much a telling factor here. There wouldn't BE a DOS problem on the Internet via-a-vis ping floods, SYN floods, etc. if the provider community refused to permit a connection to be made without airtight packet source filters which prohibited the transmission of data with unauthorized source addresses. Add to that a "chargeback" mechanism (that is, refutation of authorization for the transmission) and per-bit pricing can work. Absent BOTH of those on a worldwide basis and I could never justify recommending to anyone that they accept such a pricing system. - -- Karl Denninger (karl@denninger.net) http://www.mcs.net/~karl I ain't even *authorized* to speak for anyone other than myself, so give up now on trying to associate my words with any particular organization.
On December 5, 1998 at 14:28 karl@denninger.net (Karl Denninger) wrote:
Absent BOTH of those on a worldwide basis and I could never justify recommending to anyone that they accept such a pricing system.
Of course you could, if the per-unit cost were the same, pro-rata, as paying for the whole thing. So if the choice was between paying $48K/mo for a DS3 vs $2K/mo for each DS1-equivalent the worst case is $48K/mo anyhow so may as well take your chances with crooks. I'd argue that even at some premium, unless you're normally using almost all of it, you'd still probably be better off on average even if a crook gives you a bad week once in a while. $24K + $6K for a crook is still a lot less than $48K guaranteed, crooks or not. Etc. And there's probably going to have to be some accomodation (e.g., credits, refunds, more vigorous enforcement and detection of abuse by sellers) with any such pay-per-bit scheme. Particularly if, as I predict, it becomes a major way to sell a lot of very high bandwidth lines (155mb+) to customers who otherwise wouldn't consider so much bandwidth if they had to pay for all of it all the time. You're right that something has to be done, but I don't particularly accept that the situation is so untenable. On a service like this a credit for a bad week with a crook doesn't really drive the provider under either, particularly if they make some effort to prevent it (e.g. prosecuting abusers, detecting and blocking abuse quickly, etc.) I'd guess that one model which might work well is whitelisting: I want on-demand bandwidth up to, say, 155Mb/s to this short list of sites (VPN-ish), but only T1 to everyone else to prevent abuse. -- -Barry Shein Software Tool & Die | bzs@world.std.com | http://www.world.com Purveyors to the Trade | Voice: 617-739-0202 | Login: 617-739-WRLD The World | Public Access Internet | Since 1989 *oo*
One notable thing about per-bit pricing, as well, is that once one provider really rolls it out and pushes it at a low cost, it's bound to become a surety. Suddenly the provider with per-bit billing will be able to steal all of the low-usage customers, while leaving the expensive near-saturation customers at other providers... effectively raising their cost per DS1... As to the merits of per-bit pricing.. I could certainly see myself purchasing a lot more bandwidth if I could use it on demand, even with the possibility of someone deciding to smurf me. And think of other positive effects-- there will be real economic forces urging customers of providers not to be smurf relays, etc. Mike -- Michael P. Lyle Senior Security Architecture Analyst Exodus Communications, Inc. icee@phoenix.lyle.org <- PLAY mlyle@exodus.net <- WORK
Well, if you ever want to download DVD's or (HD DVD's in the future) in anything approaching realtime or less then we need some way to make 10-100Mbit pipes into homes economical. Current high bandwidth pricing ($100K/month or so for OC3 Internet connectivity) is just ridicuolous and in no way related to the value that is created for the customer (you can argue that point since some people are paying...) Computers have gotten faster by a factor of x over the last n years yet bandwidth costs have hardly changed in the last 10 years. This is despite the fact that the capacity of fiber already in the ground keeps increasing by leaps and bounds. Somehow this problems needs to be solved. If some sort of usage based pricing doesn't do it then we'll have to wait for super high speed, auto configuring wirelss networking in each PC. Everybody has a 100Mbit connection to all PC's within "earshot". The higher the local computer density, the higher the available bandwidth (with some upper limit of course based on how much frequency space gets allocated to this). Problem solved, phone companies roll over and dies. Dirk On Sat, Dec 05, 1998 at 04:06:30PM -0800, Michael P. Lyle wrote:
One notable thing about per-bit pricing, as well, is that once one provider really rolls it out and pushes it at a low cost, it's bound to become a surety. Suddenly the provider with per-bit billing will be able to steal all of the low-usage customers, while leaving the expensive near-saturation customers at other providers... effectively raising their cost per DS1...
As to the merits of per-bit pricing.. I could certainly see myself purchasing a lot more bandwidth if I could use it on demand, even with the possibility of someone deciding to smurf me. And think of other positive effects-- there will be real economic forces urging customers of providers not to be smurf relays, etc.
Mike
-- Michael P. Lyle Senior Security Architecture Analyst Exodus Communications, Inc. icee@phoenix.lyle.org <- PLAY mlyle@exodus.net <- WORK
On Sat, Dec 05, 1998 at 06:07:35PM -0500, Barry Shein wrote:
On December 5, 1998 at 14:28 karl@denninger.net (Karl Denninger) wrote:
Absent BOTH of those on a worldwide basis and I could never justify recommending to anyone that they accept such a pricing system.
Of course you could, if the per-unit cost were the same, pro-rata, as paying for the whole thing. So if the choice was between paying $48K/mo for a DS3 vs $2K/mo for each DS1-equivalent the worst case is $48K/mo anyhow so may as well take your chances with crooks.
Except that if I don't need a DS-3 often then the possibility of being billed for it when I wasn't the requestor is a hell of a liability.
Particularly if, as I predict, it becomes a major way to sell a lot of very high bandwidth lines (155mb+) to customers who otherwise wouldn't consider so much bandwidth if they had to pay for all of it all the time.
Again, it depends on the risk factors.
You're right that something has to be done, but I don't particularly accept that the situation is so untenable. On a service like this a credit for a bad week with a crook doesn't really drive the provider under either, particularly if they make some effort to prevent it (e.g. prosecuting abusers, detecting and blocking abuse quickly, etc.)
I'd guess that one model which might work well is whitelisting: I want on-demand bandwidth up to, say, 155Mb/s to this short list of sites (VPN-ish), but only T1 to everyone else to prevent abuse.
Possibly, yes. -- -- Karl Denninger (karl@denninger.net) http://www.mcs.net/~karl I ain't even *authorized* to speak for anyone other than myself, so give up now on trying to associate my words with any particular organization.
However, as long as we permit people to source traffic without cost and do so through proxies, this problem will exist.
This is the primary argument AGAINST anonyminity on the Internet. Your activities, anonymous or not, are not without cost to others. The entire premise that you have a right to "anonymous speech" is based upon the fact that you do not directly harm others economically or otherwise be exercising it.
However, on the Internet, this is simply not true. "Recipient pays" is a part of ALL Internet service, and always has been in one fashion or another - even when the majority of traffic was moved via modems in the 1980s and early 90s.
Note that this is VERY different from the phone or postal service networks, both of which are nearly 100% SENDER pays. The exception is cellular service, and there it is a CRIMINAL ACT to call a cellular phone on an "unsolicited" basis - that is, to cost-shift where there is a reasonable probability that the cost is unwanted. Further all phone traffic is authenticated and can be traced to the source; "spoofed traffic" (beyond activity which is per-se criminal such as cloned cellular phones) doesn't exist.
If all transmissions had to be identifyable as to their source, and chargeback capability was included (ie: if you spam me, I can charge the transmission back to you - likewise if you ping-flood me) then the problem would go away. But doing this requires strong authentication and non-denyability of the transmission itself, which flies in the face of those who scream for the ability to source anonymous traffic of one form or another.
That engineering standards have not already stabilized to prohibit sourcing of traffic with spoofed source addresses, enforced by the providers themselves, is very much a telling factor here.
There wouldn't BE a DOS problem on the Internet via-a-vis ping floods, SYN floods, etc. if the provider community refused to permit a connection to be made without airtight packet source filters which prohibited the transmission of data with unauthorized source addresses.
Add to that a "chargeback" mechanism (that is, refutation of authorization for the transmission) and per-bit pricing can work.
Absent BOTH of those on a worldwide basis and I could never justify recommending to anyone that they accept such a pricing system.
Those price mechanisms are possible on connection-oriented networks, such as X.25 and ATM networks. On connection-less networks such as IP networks, the source will always have the right to send traffic; packet filtering and traffic shaping can cut some of the possibly unwanted traffic, but not all of them. RUbens Kuhl Jr.
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use.
The other possible effect is that you buy one of these, and then someone launches a DOS attack at you and you get the bill for it.
We have used usage-based pricing for collocated customers since SMARTNAP (now IXC Austin NAP) opened it's doors nearly two years ago. That allows us to hand people a 100Base-TX port and let them pay for the bandwidth they actually use. We don't bill per byte. Instead, we use the 95% sustained utilization model that bills for your peak utilization in Mbit/sec after throwing out 5% of the 5-minute samples for the month. The 5% amounts to about 36 hours of "free" bandwidth. That means you have to be a pretty serious smurf target before attacks will affect your bill significantly. Both we and our customers have been very happy with the 95% utilization model for this type of service. It lets us set pricing based on a metric that closely follows the amount of backbone bandwidth we have to provision to support a customer. UUNET uses the same metric for their usage-based T3 lines. I believe other providers also use it. Having said that, the 95% model isn't the end-all of usage billing. Some people want to use high bandwidth for a short period of time (e.g. a video conference) and just want to pay for that period of time. In the 95% model they either win big or they lose big depending on whether their high-bandwidth usage fits in the 5% window. There are still some customers concerned about the lack of control they have over their bill. Presumably, they will have a business model that provides them with additional revenue if their traffic increases. It still makes people nervous though. Using bandwidth-limiting mechanisms can alleviate that concern at the cost of reducing their available peak bandwidth.
The economic impact of this should not be underestimated. Per-bitrate pricing is a problem as long as the receiver pays for the receipt of transmissions they may not have solicited.
The 95% model makes a fairly primitive, but fairly effective attempt at addressing that issue. The issue will be more of a concern if finer-grained usage-based billing becomes more common. -dpm -- David P. Maynard, Flametree Corporation EMail: dpm@flametree.com, Tel: +1 512 670 4090, Fax: +1 512 251 8308 --
Barry Shein wrote:
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use.
Right now flat-rate pricing mostly assumes you're going to, within some statistical model, actually use the bandwidth you get, or certainly that someone buying a DS3 is going to use a lot more bandwidth, on average, than someone with a DS1. [Rest of post deleted for brevity]
I wonder if the northeast is more expensive than elsewhere, but from my recent shopping for T1's for myself and my clients, I find the cost of the service over a T1 isn't the budget buster. For one location, all T1 circuits (before buying IP service, just the telco charge) is $613 a month. To another location, the circuits are $900 to $1500 a month. Adding $500 to $1000 on top of that for full-rate service, vs. adding $200-$500 on top of that for "burstable" service just doesn't generate much excitement. Until the base telco circuit prices are lowered dramatically, the pricing of packet service over them, while not "noise," is certainly less interesting. Now, if the whole circuit, T1 and IP packet service, were all priced on the basis of traffic, that'd be interesting. An underutilized T1 would incur some small base charge, plus traffic/usage increments beyond that. That'd be quite attractive, though I doubt the phone companies would think so. Dan -- ----------------------------------------------------------------- Daniel Senie dts@senie.com Amaranth Networks Inc. http://www.amaranthnetworks.com
On December 5, 1998 at 15:05 dts@senie.com (Daniel Senie) wrote:
Barry Shein wrote:
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use.
Right now flat-rate pricing mostly assumes you're going to, within some statistical model, actually use the bandwidth you get, or certainly that someone buying a DS3 is going to use a lot more bandwidth, on average, than someone with a DS1. [Rest of post deleted for brevity]
I wonder if the northeast is more expensive than elsewhere, but from my recent shopping for T1's for myself and my clients, I find the cost of the service over a T1 isn't the budget buster. For one location, all T1 circuits (before buying IP service, just the telco charge) is $613 a month. To another location, the circuits are $900 to $1500 a month. Adding $500 to $1000 on top of that for full-rate service, vs. adding $200-$500 on top of that for "burstable" service just doesn't generate much excitement.
I don't think the model becomes very exciting until you model it for DS3 and beyond, as you say below that there's not enough money involved to get excited about. But even at around $1K/mo for a T1 flat-rate, simple extrapolation puts a 1gb line at $1 million per mo, even if there's a 50% discount for that, $500K/mo, the customer base would be somewhat limited. Even a 155Mb/s ATM calculates to around $100K/mo using straight extrapolation. Being able to get an atm line in for, say, $10K/mo and then paying the burstable rate might seem very attractive to some.
Until the base telco circuit prices are lowered dramatically, the pricing of packet service over them, while not "noise," is certainly less interesting.
This is certainly true, and no doubt something someone in Sidgemore's position is considering since Worldcom does local loop or is certainly capable of affecting local-loop pricing.
Now, if the whole circuit, T1 and IP packet service, were all priced on the basis of traffic, that'd be interesting. An underutilized T1 would incur some small base charge, plus traffic/usage increments beyond that. That'd be quite attractive, though I doubt the phone companies would think so.
Exactly my point. -- -Barry Shein Software Tool & Die | bzs@world.std.com | http://www.world.com Purveyors to the Trade | Voice: 617-739-0202 | Login: 617-739-WRLD The World | Public Access Internet | Since 1989 *oo*
I know this is a bit late sorry... Well what if I had a xDSL local loop from someone like Northpoint for something like $150 and then did the per bit model. A T1 (or even slightly less) for $350 starts to look rather attractive to a lot of people. At 3:05 PM -0500 12/5/98, Daniel Senie wrote:
Barry Shein wrote:
One possible positive effect (for the consumer) of "per-bit" pricing is the opportunity to buy larger pipes but only pay for what you use.
Right now flat-rate pricing mostly assumes you're going to, within some statistical model, actually use the bandwidth you get, or certainly that someone buying a DS3 is going to use a lot more bandwidth, on average, than someone with a DS1. [Rest of post deleted for brevity]
I wonder if the northeast is more expensive than elsewhere, but from my recent shopping for T1's for myself and my clients, I find the cost of the service over a T1 isn't the budget buster. For one location, all T1 circuits (before buying IP service, just the telco charge) is $613 a month. To another location, the circuits are $900 to $1500 a month. Adding $500 to $1000 on top of that for full-rate service, vs. adding $200-$500 on top of that for "burstable" service just doesn't generate much excitement.
Until the base telco circuit prices are lowered dramatically, the pricing of packet service over them, while not "noise," is certainly less interesting.
Now, if the whole circuit, T1 and IP packet service, were all priced on the basis of traffic, that'd be interesting. An underutilized T1 would incur some small base charge, plus traffic/usage increments beyond that. That'd be quite attractive, though I doubt the phone companies would think so.
Dan
-- ----------------------------------------------------------------- Daniel Senie dts@senie.com Amaranth Networks Inc. http://www.amaranthnetworks.com
Thank you, David Diaz Chief Technical Officer Netrail, Inc email: davediaz@netrail.net pager: 888-576-1018 office: 888-NETRAIL Fax: 404 522-2191 Colo facilities: Atlanta-NAP, Miami, Arlington, Chicago, San Francisco -------------------------------------------------
On Tue, 8 Dec 1998, David Diaz wrote:
I know this is a bit late sorry...
Well what if I had a xDSL local loop from someone like Northpoint for something like $150 and then did the per bit model. A T1 (or even slightly less) for $350 starts to look rather attractive to a lot of people.
True, but if you become a CLEC and use something like access method 5 you can get that loop cost to around $30 and also offer voice services using the first 4 kHz of the loop. -- Check out the new CLEC mailing list at http://www.robotics.net/clec
<> Nathan Stratton Telecom & ISP Consulting www.robotics.net nathan@robotics.net
Most small ISPs cant afford to do that. Becoming a CLEC is not a $100 turnkey option. However you can get good pricing from many CLECs and then take a ATM (or even frame) T1 handoff. Pretty small barrier to entry and it let's you scale from there without having to have the equipment, lawyers and patience. I'm also thinking where this model might work well is in bldings where you can go in, drop a TNTdsl in the basement. Use existing copper to provide 1.5meg (soon 2.23meg/sec??) handoffs to each suite. Then run a frame through the local RBOCs cloud to your hub. This would allow you to start small at several bldings and scale from there. It would make sense to charge by the bit since that most likely will be your #1 cost. All the equipment can be leased including CPE side which would be some cheap PipeDSLs. At 11:03 PM -0500 12/8/98, Nathan Stratton wrote:
On Tue, 8 Dec 1998, David Diaz wrote:
I know this is a bit late sorry...
Well what if I had a xDSL local loop from someone like Northpoint for something like $150 and then did the per bit model. A T1 (or even slightly less) for $350 starts to look rather attractive to a lot of people.
True, but if you become a CLEC and use something like access method 5 you can get that loop cost to around $30 and also offer voice services using the first 4 kHz of the loop.
-- Check out the new CLEC mailing list at http://www.robotics.net/clec
<> Nathan Stratton Telecom & ISP Consulting www.robotics.net nathan@robotics.net
Thank you, David Diaz Chief Technical Officer Netrail, Inc email: davediaz@netrail.net pager: 888-576-1018 office: 888-NETRAIL Fax: 404 522-2191 Colo facilities: Atlanta-NAP, Miami, Arlington, Chicago, San Francisco -------------------------------------------------
On Tue, 8 Dec 1998, David Diaz wrote:
Most small ISPs cant afford to do that. Becoming a CLEC is not a $100 turnkey option. However you can get good pricing from many CLECs and then take a ATM (or even frame) T1 handoff. Pretty small barrier to entry and it let's you scale from there without having to have the equipment, lawyers and patience.
That is just it, that is why I said using access method 5, you dont need to colo in the CO, most ISPs can afford to become CLECs if they can get rid of that 100 - 300K expense. It is not a $100 turnkey option, but it is something you could do for 5K. You say that you can get good pricing from the CLECs, I just have not found that to be true. Have you looked at Covad and Northpoints pricing? It is hard to make any money at that when the ISP down the streets cost is $30.
I'm also thinking where this model might work well is in bldings where you can go in, drop a TNTdsl in the basement. Use existing copper to provide 1.5meg (soon 2.23meg/sec??) handoffs to each suite. Then run a frame through the local RBOCs cloud to your hub. This would allow you to start small at several bldings and scale from there.
If you were in the building you could do VDSL and give everybody 53 meg.
It would make sense to charge by the bit since that most likely will be your #1 cost. All the equipment can be leased including CPE side which would be some cheap PipeDSLs.
There also is CPE comming out with voice, video, and ethernet jacks all under $750.
On Tue, Dec 08, 1998 at 11:03:16PM -0500, Nathan Stratton wrote:
Well what if I had a xDSL local loop from someone like Northpoint for something like $150 and then did the per bit model. A T1 (or even slightly less) for $350 starts to look rather attractive to a lot of people.
True, but if you become a CLEC and use something like access method 5 you can get that loop cost to around $30 and also offer voice services using the first 4 kHz of the loop.
Yeah... but you _STILL_ can't get that large a router port for that little money, and you never will. Bandwidth is what costs money, not copper. Cheers, -- jr 'and people _STILL_ miss this' a -- Jay R. Ashworth jra@baylink.com Member of the Technical Staff Buy copies of The New Hackers Dictionary. The Suncoast Freenet Give them to all your friends. Tampa Bay, Florida http://www.ccil.org/jargon/ +1 813 790 7592
On Wed, 9 Dec 1998, Jay R. Ashworth wrote:
On Tue, Dec 08, 1998 at 11:03:16PM -0500, Nathan Stratton wrote:
Well what if I had a xDSL local loop from someone like Northpoint for something like $150 and then did the per bit model. A T1 (or even slightly less) for $350 starts to look rather attractive to a lot of people.
True, but if you become a CLEC and use something like access method 5 you can get that loop cost to around $30 and also offer voice services using the first 4 kHz of the loop.
Yeah... but you _STILL_ can't get that large a router port for that little money, and you never will.
Bandwidth is what costs money, not copper.
I was just saying how you could lower the cost of the ADSL loop from around $150 to $30, with both you would need to supply the IP. The idea would be that you would not just use the port for internet traffice. You would provide voice services, you would provice VOD (video on demand), and cable services (using something like I Magic TV). -- Check out the new CLEC mailing list at http://www.robotics.net/clec
<> Nathan Stratton Telecom & ISP Consulting www.robotics.net nathan@robotics.net
Cheers, -- jr 'and people _STILL_ miss this' a -- Jay R. Ashworth jra@baylink.com Member of the Technical Staff Buy copies of The New Hackers Dictionary. The Suncoast Freenet Give them to all your friends. Tampa Bay, Florida http://www.ccil.org/jargon/ +1 813 790 7592
On Wed, Dec 09, 1998 at 10:33:44AM -0500, Nathan Stratton wrote:
Yeah... but you _STILL_ can't get that large a router port for that little money, and you never will.
Bandwidth is what costs money, not copper.
I was just saying how you could lower the cost of the ADSL loop from around $150 to $30, with both you would need to supply the IP. The idea would be that you would not just use the port for internet traffice. You would provide voice services, you would provice VOD (video on demand), and cable services (using something like I Magic TV).
Oh yeah, I got that, Nathan. It's just that I get miffed when people keep going on (don't take this personal) about how cool it is that I can get my loop down from $300 to $150... when my router port is still $1800. Nice, yeah, but not what people mean when they blather about "cheap bandwidth". If it's _that_ cheap, it's running under completely different assumptions than a standard T-1; viz: cable modems. And now for something completely different. Anyone need a wireless T-1? http://cgi.ebay.com/aw-cgi/eBayISAPI.dll?ViewItem&item=47936641 Cheers, -- jr 'got a bunch of 5251 cards, too' a -- Jay R. Ashworth jra@baylink.com Member of the Technical Staff Buy copies of The New Hackers Dictionary. The Suncoast Freenet Give them to all your friends. Tampa Bay, Florida http://www.ccil.org/jargon/ +1 813 790 7592
On Wed, 9 Dec 1998, Jay R. Ashworth wrote:
Oh yeah, I got that, Nathan. It's just that I get miffed when people keep going on (don't take this personal) about how cool it is that I can get my loop down from $300 to $150... when my router port is still $1800. Nice, yeah, but not what people mean when they blather about "cheap bandwidth". If it's _that_ cheap, it's running under completely different assumptions than a standard T-1; viz: cable modems.
I dont take it personal because I agree with you. :-) -- Check out the new CLEC mailing list at http://www.robotics.net/clec
<> Nathan Stratton Telecom & ISP Consulting www.robotics.net nathan@robotics.net
And now for something completely different. Anyone need a wireless T-1? http://cgi.ebay.com/aw-cgi/eBayISAPI.dll?ViewItem&item=47936641
Cheers, -- jr 'got a bunch of 5251 cards, too' a -- Jay R. Ashworth jra@baylink.com Member of the Technical Staff Buy copies of The New Hackers Dictionary. The Suncoast Freenet Give them to all your friends. Tampa Bay, Florida http://www.ccil.org/jargon/ +1 813 790 7592
Nathan Stratton wrote:
On Tue, 8 Dec 1998, David Diaz wrote:
I know this is a bit late sorry...
Well what if I had a xDSL local loop from someone like Northpoint for something like $150 and then did the per bit model. A T1 (or even slightly less) for $350 starts to look rather attractive to a lot of people.
True, but if you become a CLEC and use something like access method 5 you can get that loop cost to around $30 and also offer voice services using the first 4 kHz of the loop.
Unfortunately you'd still be at the mercy of the RBOC to actually take care of your line when it breaks. I'm not even sure being a really big CLEC would help in my neck of the woods. What I wouldn't give to be able to buy connectivity from someone other than Bell Atlantic (he says, after waiting 27 hours for a blown mid-span repeater to be diagnosed and replaced). Dan -- ----------------------------------------------------------------- Daniel Senie dts@senie.com Amaranth Networks Inc. http://www.amaranthnetworks.com
participants (11)
-
Barry Shein -
Daniel Senie -
David Diaz -
David P. Maynard -
dirk＠power.net -
Jay R. Ashworth -
Karl Denninger -
Michael P. Lyle -
Nathan Stratton -
Pete Kruckenberg -
Rubens Kuhl Jr.