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If a customer is paying for an internet connection, they are paying for access the full internet, to the best of their ISP's abilities. This is the net neutrality law we need: ISPs should be compelled to upgrade their backbone links as they become congested, to satisfy their customer's demand. Congestion can be easily monitored and often these peerings are "free". (Yes there is a non-zero cost to increase switch and router capacity and to have someone plug the cables in, but it's not like Level3 is charging for the bits exchanged.) But the point is, since most ISPs are de-facto monopolies in this country, we need rules telling them they have to upgrade their capacity to meet their customers demand, if they are promising broadband speeds.



This. ISP's of the like mentioned by the OP are being paid for INTERNET access. Not access to the local network resources on the ISP's network. If I pay for an X up/Y down connection to the internet then that is what I expect. I expect X up/Y down to any host/content on the internet (given that host can reply at that speed, etc.)


We probably need pricing more directly based on bandwidth consumed, maybe with peak hour pricing, as opposed to just based on "speed" with high bandwidth caps.


Like the water or electric company, users should pay according to usage. As you say, this isn't on total bits pushed through, because the marginal costs of sending bits at 3am is nil.

So the "usage" is based on the continued need to build out more equipment. Usage at peak hours, as you say.

I'm concerned that the ISPs will simply charge "big users" and pocket the extra fees, with "big users" moving from 1-in-a-thousand to 1-in-a-dozen as more people want to use more bandwidth. I trust my ISPs as far as I can throw them. (And I believe this distrust is at the heart of a lot of people's calls for net neutrality; simply put, they don't trust their ISP to play fair. And I don't fault them for that.)

But I don't mind something that targets the single biggest users and makes them pay extra. The water and electric systems would fail without that, and those are much simpler to model and plan for.

Thinking out loud, we need something that both

1) keeps pressure on the ISPs to keep on growing their pipes, and

2) puts pressure on the biggest users, which, again, needs to be a very small subset of people putting the biggest strain on the system. I can't come up with an exact number, but 20% of people being considered "big users" is too much.


I'm willing to pay for usage, sure. And I'll pay for the physical plant to my house too. BUT (and this is a big but) I'm only willing to do so at reasonable prices.

You want me to pay for the physical plant? OK I can deal. The phone company can provide me with a pair of wires from my house to their POP for about $15. I might pay $20 since coax is different than UTP, but that's about it.

You want me to pay per bit? Great! Bill me at wholesale network rates. You don't want to do that? Sorry, fuck off. I'm already paying for the last-mile transport with the physical plant charges.

https://josephscott.org/archives/2009/01/how-much-does-one-t...

Here I can buy RETAIL 2TB of bandwidth for $120 WITH A SERVER INCLUDED. I imagine that the wholesale is slightly (or much, much) cheaper than that. But let's just go with it. At that kind of pricing I can get 1TB for $60, 500GB for $30 and 250GB (the caps Comcast is talking about) for $15. If I need another 50GB (their incremental unit of charge for "overage") I should be able to get that for $3, not the $10 that they're charging.

http://customer.comcast.com/help-and-support/internet/data-u...

Now I think that a lot of the cost of that server is the actual machine, the building, the air conditioning, etc. So maybe you should cut all those numbers in half again meaning that 50GB should cost me about $1.50 and 1TB costs more like $30. This is of course assuming you're not involved in a PEERING AGREEMENT which as Comcast you are.

What about Comcast's costs for termination equipment I hear you say. Okay let's talk about that. I bought my own cable modem so they're not paying for that. They have to have another one on their side, sure. Assuming that it's the same price as mine (it's almost certainly cheaper) that's $100 or less. Considering that DOCSIS standards are usually a few years apart $100 / 4 years = $2 per month. That's not too bad.

And what about the back-haul from their POP to the peering point? There's a cost associated with that right? Yup, that's what I'm paying for when I buy Internet access from an ISP since they're not paying for the peering agreement.

Adding all this up: $20 (for the plant) + $15 (for the wholesale bandwidth 500GB ) + $2 (for the termination equipment ) = $37 per month with each additional 50GB costing an extra $3

This seems reasonable to me and I would happily pay it, so long as the wholesale price continues track the market. But with Comcast right now I'm paying more like $65 rather than $37.

For reference 500GB/mo (if it's 100% evenly distributed) is about 5Mbps. If you figure it's a bit bursty, say 50% on and 50% off that's 10Mbps. If it's 75/25 then it's 20Mbps. 88/12 brings it up to 40Mbps. So these are reasonable numbers to expect given the service I've signed up for is advertised the way it is.


Don't buy into the cable PR. They have incredibly high margins and could easily make upgrades without further gouging customers.


"incredibly high"? Comcast and Time Warner have profit margins of 8-10%. For comparison, Target has a profit margin of 3%, and Google's is 21%.

Sounds more mid-range to me.

As for your second point, that they could easily make upgrade without additional charges.. have any numbers backing that up? The last mile is expensive.


It's not the last mile that needs to be upgraded.


Metered ISPs would be fine if the prices were reasonable, something comparable to data center bandwidth pricing. The problem is that they want to charge unreasonable prices.




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