Re:Netflix: ISPs who charge by the gigabyte are ridiculous
by psyconn on Thursday January 27, 2011 @04:30AM
(#2147248)
The article is not about bandwidth but about the amount of data you can download at a reasonable price. People are actually willing to spend more time downloading something instead spending more money.
Re:Netflix: ISPs who charge by the gigabyte are ridiculous
by hxa7241 on Thursday January 27, 2011 @11:34AM
(#2148421)
The amount of data, when aggregated over many people, adds up to bandwidth of network needed.
An ISP's customers, all added together, are downloading a certain amount per month. That is, a certain amount of data per time period -- which is bandwidth.
For example, in the UK the last mile is usually supplied by the incumbent (BT), who also (virtually) route that traffic over a private IP-based backbone to ISPs to provide the backhaul. They charge ISPs by capacity. So these ISPs effectively have marginal costs that vary throughout the day according to demand, since they have to pay directly for an appropriate (fixed) amount of capacity to be available.
We also have LLU (local loop unbundled) ISPs who still use BT's last mile but provide their own equipment directly at the exchanges, thus effectively providing backhaul straight from the exchanges. They may only have a fixed cost for bandwidth depending on how they provision those links. But if they are buying capacity from anyone else, they will be charged by how much they are buying, and suddenly they have a marginal cost again.
The article says that Netflix are complaining about the situation where Netflix have brought the traffic to the last mile. In this specific situation it makes sense. But in the general case, ISPs still have marginal costs in providing bandwidth.