Linode Reduces Transfer Pricing (Incoming Data is now Free)

Re:Linode Reduces Transfer Pricing (Incoming Data is now Free) by ghshephard on Thursday September 01, 2011 @07:39PM (#2952274)

It's pretty straightforward - find a high-water mark for customers in terms of their inbound data, that 99.9% fall under, say, for linode, 99.9% of their customers pull in less than 16 megabits/second sustained, which is 7.2 Gigabytes/Hour, 5 Terabytes/Month.

And then explain to your customers that 99.9% of them use less than 5 Terabytes/Month bandwidth, and that effective now, the first 5 Terabytes/month of bandwidth is included in the cost of their VPS, and for those 0.1% of customer who exceed that 5 Terabytes, they'll get a very reasonable rate of $0.01/gigabyte ($10/Terabyte) for inbound data in excess of the 5 Terabyte initial allocation.

Realize that linode is probably paying less than $4/megabit @ 95th percentile - but the vast majority of that is likely downloaded, so they have an asymmetric allocation that they are trying to utilize with this "unlimited inbound" offer.

I just want the HN audience, in particular, to realize that the statement ""This means you can upload an unlimited amount of data to your Linode without having to pay for any of the incoming data transfer."" should not be taken at face value if you are putting together a business plan.

In general - bandwidth is priced @95th percentile on the internet, and any time you run into the phrase "unlimited" you should take it with a grain of salt and get something in writing before you rely on it.

[ Parent | on HN ]

Re:Linode Reduces Transfer Pricing (Incoming Data is now Free) by chc on Thursday September 01, 2011 @08:31PM (#2952403)

I'm not sure that will work — it certainly doesn't seem to be solving the problem that thaumaturgy brought up. Although it spells out a concrete limit, it does not give any kind of assurance that it's (probably) enough. Lots of companies use that kind of language to make a plan sound reasonable when it isn't. For example, I don't tether or anything and don't watch a lot of video, but I'm still way above the tiny data plan that AT&T says is enough for 95% of its customers. Like, are we counting customers who don't even have smartphones?

I'd rather just "unlimited (note: OK, you can't actually download the whole Internet)" or something like that if you want to get really picky. It conveys the right message while still providing needed information to slower readers.

[ Parent | on HN ]

Re:Linode Reduces Transfer Pricing (Incoming Data is now Free) by marshray on Thursday September 01, 2011 @09:49PM (#2952586)

Ask yourself: "Is it possible that my customers might perceive my business as resembling AT&T?"

If so, change your behavior!

[ Parent | on HN ]

Re:Linode Reduces Transfer Pricing (Incoming Data is now Free) by wtallis on Thursday September 01, 2011 @09:53PM (#2952595)

I suppose the difference ultimately lies in the fact that were Linode to say that a certain level of usage was 95th or 99th percentile, they could be believed. With AT&T, you have to assume that everything they say about bandwidth limits is wrong, and probably a lie.

[ Parent | on HN ]

Re:Linode Reduces Transfer Pricing (Incoming Data is now Free) by lsc on Saturday September 03, 2011 @02:08AM (#2956639)

>Realize that linode is probably paying less than $4/megabit @ 95th percentile - but the vast majority of that is likely downloaded, so they have an asymmetric allocation that they are trying to utilize with this "unlimited inbound" offer.

At the he.net fremont 1 location, at least, you can buy a full 1000Mbps pipe and run it flat out for $700/month, if you get in on the special. (The old standard price was $1000 for the same thing.) At least at that location, you are paying a lot less than $4 per megabit. (from what I've seen, paying on the 95th percentile usually doesn't make sense, as you get radically lower prices if you buy by the gigabit.)

From what I've seen of other locations around silicon valley, $0.70 per megabit is a pretty low price, but $4 per megabit? if you are buying more than a gigabit, that's a relatively high price. (I mean, you can reasonably pay that much, but you are approaching 'premium' pricing, something that a large IT shop is much more likely to do than a VPS provider.)

[ Parent | on HN ]

Re:Linode Reduces Transfer Pricing (Incoming Data is now Free) by lsc on Friday September 09, 2011 @07:34PM (#2980250)

so I'm getting quotes for bandwidth right now, and I have a correction: he.net and Cogent are the only two major players I was able to get in that range. There are smaller players in that range, too, but only two major players, so it's probably wrong to call that 'premium' pricing. None the less, he.net is under $1 per megabit, so someone in a he.net data center, very likely, is paying very little indeed for bandwidth.

[ Parent | on HN ]