Comment The economics of metered bandwidth (Score 1, Informative) 578
Those that are in favour of unmetered, unlimited use of residential services are sadly a little "hard of thinking".
Scenario 1
ISP has finite upstream bandwidth (this is a given).
This wholesale bandwidth is resold (marked-up) and oversold (contended) for residential services.
That's how you get '7mb' connections that don't cost 1000's of $$
If this limited resource is sold as 'unlimited', and it is treated as such by customers, the economics start to move against the ISP.
They need to limit and degrade the service in order to turn a profit.
THE INCENTIVE IS FOR THE COMPANY TO PROVIDE A LOWER QUALITY SERVICE
Scenario 2
A basic usage amount is included free inside the package. This could be 10GB, 30GB, 100GB or whatever covers 90%+ of their customer base.
Customers wishing to use more, at full speed, pay for additional usage. Some markup over wholesale rates.
In this scenario, the incentive is to encourage the customer to use more, not less bandwidth.
They get to purchase more network for their users.
Low-usage users are not impacted by bandwdith hogs.
Makes more sense, right?
Scenario 1
ISP has finite upstream bandwidth (this is a given).
This wholesale bandwidth is resold (marked-up) and oversold (contended) for residential services.
That's how you get '7mb' connections that don't cost 1000's of $$
If this limited resource is sold as 'unlimited', and it is treated as such by customers, the economics start to move against the ISP.
They need to limit and degrade the service in order to turn a profit.
THE INCENTIVE IS FOR THE COMPANY TO PROVIDE A LOWER QUALITY SERVICE
Scenario 2
A basic usage amount is included free inside the package. This could be 10GB, 30GB, 100GB or whatever covers 90%+ of their customer base.
Customers wishing to use more, at full speed, pay for additional usage. Some markup over wholesale rates.
In this scenario, the incentive is to encourage the customer to use more, not less bandwidth.
They get to purchase more network for their users.
Low-usage users are not impacted by bandwdith hogs.
Makes more sense, right?