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Subject: Re: IP-tel
From: Patrik Fältström <[log in to unmask]>
Reply-To:Network management discussion for Nordic region <[log in to unmask]>
Date:Fri, 24 Jan 2003 11:36:35 +0100
Content-Type:text/plain
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On fredag, jan 24, 2003, at 11:12 Europe/Stockholm, Saku Setala wrote:

> Most of the customers jumped to flat rate when it
> was made available. Only customers with very very
> small traffic still keep the metering.
>
> I admit that at least the list prices for metered traffic
> has not been very attractive.

Du you have any examples?

If an ISP have only 2 classes of usage fees (to make the calculations
simple), and 1000 customers, out of which 2 is in the higher usage fee
class, then it could look like this:

Installed bandwidth to customers: 10Mbs
Average usage for low bandwidth users: 50kbps (over 7/24/365)
Average usage for high bandwidth users: 2Mbps (over 7/24/365)

The amount of bandwidth needed in backbone is 998*50kbps+2*2Mbps ->
53.9Mbps
(not 1000*10Mbps Bengan ;-)

Say the cost for this backbone is 1MSEK/month. This can be divided
equal, which gives 1000SEK/month and customer, or 2000SEK/month for the
high class users and 997SEK/month for the low class users.

Now, you might ask, does those 3SEK matter?

Not for the user, but for the ISP.

Say 98 users more end up in the high volume category, then we need
900*50kbps+100*2Mbps -> 245Mbps, which is almost 5 times the bandwidth
in the backbone. _THAT_ incremental increase cost quite a lot of money.
Not 5 * 1MSEK maybe, but close. As ISP, you really need the extra
98*1003 (98294SEK/month) in income to pay for the investment.
Alternative is to split that money on all customers, which give an
increase of 98SEK/month and customer.

So, who should pay? Everyone 98SEK/month extra, or the 98 which move to
the high volume class 1003SEK/month?

     paf

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