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Billing system.... speed VS usage.

loveridge
Grafter
Posts: 52
Registered: 12-10-2007

Billing system.... speed VS usage.

Hi all.
Firstly, this is not a rant at PN, all in all, they are doing quite a good job.
My enquiry is this, and everyone feel free to give your opinions.

I work in an IT dept for a county wide trianing organisation, and as a result, I have an observation I would like to share with you all.
We have a WAN that links our various sites, and each site has its own LAN. Now, when I have to price up new LANs, or upgrade exisitng ones I have to decide on either 100mb, or 1000mb. Whichever standard I choose, the installation costs are relative. However, I do not have to work out running costs for these networks on the basis of traffic. The cost of networking, (I may be wrong) is in the speed of the equipment.

So, with this in mind, why do ISP's have to pay BT per MBit? If plusnet purchase for arguments sake a 10MB ADSL line from BT, then surely BT should only be charging PN rental for a 10MB speed, and not for how much traffic is used. Surely the actual running cost of a 10Mb network is the same no matter the traffic. It smells of extortion. Apart from electricity, there are no raw materials being consumed to transfer binary code. To send a file over a lan costs nothing once the lan is in place. I understand that data storage costs, but as PN (with regards to P2P and the Web) are just 'passing the data through' it shouldnt pose any extra costs. So why do Plusnets suppliers charge?

So my final summary is: Why charge for using something that costs nothing? Charge for the speed, not the size, as it is speed that acutally costs.
12 REPLIES
aeroalfie
Grafter
Posts: 400
Registered: 03-10-2007

Billing system.... speed VS usage.

All a bit complicated for me but I’m guessing the answer is because BT can get away with it - if an ISP told BT to stick it what options would be open for the ISP, is there an alternative way that services as many as BT?
N/A

Billing system.... speed VS usage.

To take your example of putting in a network:

IF you decided to go with a 100Mb network then here is how it would work:

You'd pay a minimal amount for the network card and then the vendors of that card would charge you per GB of data that crossed over that network (indirectly) by charging you a fee for that 100Mb of bandwidth regardless of whether it was in use or not.

Congratualtions you are now an ISP Smiley

We pay the same port cost per user at the exachange regardless of the speed of the connection, the cost (to us) is in the Bt central capacity which is the equivalent of your LAN conneciton between PCs (or between PlusNet and it's customers in our analogy).

Try this for starters http://www.kitz.co.uk/adsl/CBC.htm and then looking into BT central costs or capacity based charging.

hope this helps.

*edit thought this was in the broadband Help forum so no doubt others will be along to answer this.

BT did use to charge on the basis of the speed of the conneciton but unfortunately this is no longer the case hence the demise of the "unlimited" broadband market.
N/A

Billing system.... speed VS usage.

we live in a capitalist country, make money wherever you can
loveridge
Grafter
Posts: 52
Registered: 12-10-2007

Billing system.... speed VS usage.

Thanks for the info

I hope this trend doesnt catch on then, I would hate to rent a DVD and pay for however many times I watch it, or buy a car and pay the manufacturer per mile I am going to drive it. Wink

Its just a shame that PN, us the consumer and everyone else in the chain cant simply rent the connection, regardless of how many times the transistors inside switch on and off. In PN's and BT's view point, that would mean any subscriptions after the cost of the network setup is met is profit. I am sure with a system like that with no need for restrictions or throttling, there would be a flood of new subscribers, which in turn pay for more bandwidth.

So another quiery, PN, do BT charge you for renting their equipment AND the traffic through it? I wouldn't want to buy a taxi AND pay the fair for travel.
:lol:
N/A

Billing system.... speed VS usage.

Quote
So another quiery, PN, do BT charge you for renting their equipment AND the traffic through it? I wouldn't want to buy a taxi AND pay the fair for travel.


Yep, to refer back ot my analogy we buy the network card from them (every month) and then pay for traffic over the ethernet cables too Smiley

In fairness this does allow BT to invest in new technology such as ADSL2 and dslMAX that we should be seeing shortly as well as all manner of research. Not saying it's ideal but just trying to bring some balance.

There is of course the profit factor too.
Community Veteran
Posts: 5,877
Thanks: 1
Registered: 05-04-2007

Billing system.... speed VS usage.

Also think of it like this.

Plusnet don't own the pipe they rent it. The bigger the pipe; the higher the rental charge from BT.

Akin to how the water network works....
Discostoo
Grafter
Posts: 197
Registered: 28-08-2007

Billing system.... speed VS usage.

Sounds great, but BT are victims of their own success, everyone charges them more for services, they then charge more etc, etc... add that to the fact we have the "rip-off Britain" factor. I'd be happy to rent the connection , but i think i'd cost a heck of a lot more than £21.99 p/mth. Will Plusnet's SUP/FUP limits increase with an 8MB-24MB connection?
N/A

Billing system.... speed VS usage.

They will increas when costs of centrals come down i would recon
Neil_A
Grafter
Posts: 450
Registered: 04-04-2007

Billing system.... speed VS usage.

Hi there,

As wholesale prices come down I'd certainly expect to see increases in SUP levels.
loveridge
Grafter
Posts: 52
Registered: 12-10-2007

Billing system.... speed VS usage.

PN.. Does this sound feasable?

Set up a P2P account, with a contention of say, 10:1 per line. Set it as a 1Mb per customer, and remove all restrictions/traffic shaping etc. Work out a monthly figure, and then the 10 people on that line still should get a very reasonable connection, given that with P2P its extremely rare that you have your connection is rarely maxed out for more than a couple mins at a time because it all depends on the upload speed of those sharing.
An account like this would then free up the normal residential and business connections and create a wonderful service for them.

So go on PN, for curiosity, what would such a service cost a subsriber per month?

:lol:
Ben_Brown
Grafter
Posts: 2,839
Registered: 13-06-2007

Billing system.... speed VS usage.

I can't say exactly but far too much money for anyone to take it up.
kitz
Rising Star
Posts: 817
Thanks: 46
Registered: 08-06-2007

Billing system.... speed VS usage.

Good idea in theory... not sure if it would actually work out though.

For a 1:1 connection you are looking in the region of 10-14k pa.. plus a few other costs on top.
Divide this by 10 to get 10:1 and if my maths are correct you are looking in the region of a min £100 per month.

So far so good?

Well the type of user who is going to be willing to fork out £100 per month for his internet connection is very likely be wanting to shift some heavy load of data.
Would I like to be contended with this type of user.. nope.. cause as sure as damn it.. you would only get 1/10th of your speed. Sad

There was a co that had a go at setting up a wireless connection in this area with similar thoughts in mind..
speeds were not brilliant.. and anyone maxing out immediately slowed everyone else down. Unfort the business went under.

IPStream adsl despite what some may think has never been intended for continous downloading because of the contention ratios.

BTw have always stated (SIN 386 4.1)
"the End Users require occasional fast but ‘bursty’ access to private network facilities and / or the Internet (via the Customer). The products are not suitable for End Users who require continuous bit-rate, fullbandwidth services."

The only reason it works as it does is because of the huge number of subscribers involved.
The smaller the overall users sharing the "contended line".. the worse contention is.
It mainly the reason why Bulldog DataStream was such a disaster for many.