Comcast_Is_Starting_The_Tiered_Internet_Whether_We_Like_It_or_Not

Steven Alligood steve at bluehost.com
Tue Aug 21 09:27:21 MDT 2007


The issue here isn't what services should or should not be open, but 
what makes the company providing the service money, and what looses them 
money.

Say they charge $30/month for the cable modem service.  After 
infrastructure costs (helpdesk, installation, fiber runs, routers, 
servers, etc) and bandwidth costs, what is left is profit.  You cannot 
change most of the infrastructure costs, but you can affect how much 
bandwidth people use.  Add to this the need to stay competitive and 
constantly show users that you allow them tons more than their 
competitors, and at the same time not wanting any user to cost you more 
than you make.

It is true that most users do not come anywhere near the limits, but the 
5% that do cost a lot of money.

Example.

Suppose that Internet bandwidth costs $20/megabit.  Now suppose that 
your top 5% bandwidth users mostly are using torrents (or any peer to 
peer), and averaging 6 megabits of traffic each.  That becomes 
$120/month of cost, whereas they only make $10/month on that customer.  
Sure, the other 2000 customers on that router blade combined are only 
averaging 20 megabits (together) and the company overall makes money.  
Now put pressure on the CEO to make even more profit, and where can it 
be found?  Again, the top 5% of the customers, each of which can be 
charged more (profit) or restricted to lower bandwidth (lower expenses) 
or annoyed enough to leave (lower expenses).  Even worse is if they have 
to add another router to handle the traffic on that particular hub, and 
they will be even more inclined to let the peer to peer users go away.


-Steve


Clint Savage wrote:
> My friend Christer Edwards posted an article about how he is getting
> the shaft when it comes to torrent traffic.  He's just sharing his
> torrents for Ubuntu.  I disagree with Comcast charging him for his
> bittorent traffic as if its not appropriate.  There are a lot of
> reasons we need to keep them from doing this, but I think Christer's
> article says it best.
>   
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