Hacker News Reader

> Your electric utility service is capped, but they use a different method because electric utilities are metered. You have a fixed capacity feed to your house. For example, our home has 150 amp service. I cannot exceed that draw or the main feed breaker trips and everything goes dark. I can request installation of a larger feed, but I have to pay the build-out, and there are hard limits based on my local zoning.

> One thing is certain, in no way do I have "unlimited" electricity available at my home.

By that metric, uncapped data is not unlimited, and thus does not need a cap.

> This whole notion that unlimited internet for $60/month is some kind of "right" is just preposterous.

It's not unlimited since it's (by your own account) 15/3. That's a limitation right there, identical to your 150 amp service. And you can not exceed that limit period (you won't even get close to it, really). No need for a breaker.

> It's not unlimited since it's (by your own account) 15/3. That's a limitation right there, identical to your 150 amp service. And you can not exceed that limit period (you won't even get close to it, really). No need for a breaker.

It is one form of limitation, but it is not the most relevant.

The point is that Comcast has to pay for the transfer of data in and out of their network. So they have two choices:

* Meter your data transfer and charge a base fee for available bandwidth (just like commercial usage)

* Throttle your bandwidth so that you cannot exceed a set monthly transfer amount

Do you really want either? I don't. Assuming you want the later option, here's the breakdown:

250 GB -> 2,000 Gb (gigabits)

There are 2,678,400 seconds in a month.

2,000 Gb per 2,678,400 seconds

Reduced is: 0.0007467145 Gb per 1 second

Multiply by a factor of 1,048,576 (kilobits in a gigabit) and you get: 782.9868578256 kbps

To cap you at 250 GB per month (which their model is built around), you'd end up with an internet connection that is roughly the speed of an entry-level DSL connection (768 kbps DSL).

Does that make any sense to anyone? You can't simply wash away the cost of transferring the data in and out of their network with some government mandate.

The other option is to pay for metered bandwidth. This means the additional overhead of metering each customer, as well as the additional billing infrastructure. Not an impossible problem, but it's a lot of data to track, and the overhead is undeniable, so you'll end up getting more for less.

OR!

We could all cooperate and agree that there is a "typical" consumer use case with a soft ceiling of 250 GB of transfer per month. If can't operate within that ceiling, you should look in to a business-class connection where the pricing models fit your needs better.

Please, if you're going to bury my comment, point out what I've misstated. If you're sitting there in your chair, disagreeing with me, but you can't figure out why, you're just lying to yourself.

If I've made a mathematical error, or misstated a fact, I'm happy to concede the point.

You say that metered, per-byte billing will impose a significant overhead. For ISPs that already have caps, they are already counting the bytes, so the only overhead would be in the variable billing. Half of the ISPs already do that for their non-IP services.

You also haven't said how much it costs a company like Comcast to pay for transit of their customers' data. You haven't given anyone reason to believe that transit actually is the dominant cost to a residential ISP.

You make a good point about already counting the bytes. That fact flew right past me when I was considering the overhead.

I can't answer the second question because I can't see Comcast's peering agreements. I do know that they're not always comfortable (see last year's Comcast/Level 3 dispute), but as the FCC pointed out, peering agreements are a private matter.

I'm playing devil's advocate here to some degree. I get that everyone wants to see an improvement in the availability and cost of broadband in the states. No question about it, but this article is about a person who used 250 GB of data in a month on a residential connection. I'd love too see a histogram that shows the distribution of data transfer usage per customer, but Comcast doesn't publish that information, so I'm left to assume that the fact that very few people encounter that limit is proof that it's pretty far above the norm. Feeding the sense of entitlement that this type of usage should be allowed is not how we'll make progress here.

All tier 1 ISPs have peering agreements where most pay nothing for traffic transfer. The real costs are the equipment, ISPs use statistical multiplexing to maximize the value of their lines and switches. Data caps only affect this indirectly, it is bandwidth that matters. If an ISPs' equipment can only handle 10Gb/s of bandwidth without degrading that is the real limit, the total amount of data a month is mostly immaterial. Simply put if everyone used up their data cap on the first day of the month the ISP could not handle it even though no one went over their cap.

I wonder how small ISPs like those in my country can afford to provide at least 500GB/month at 30Mbps for about $60. On the other hand, I do have about four other ISPs I can switch to, maybe that influences it?

> On the other hand, I do have about four other ISPs I can switch to, maybe that influences it?

Real competition, yes, that is the big influence. Sadly, in way to many locations in the US, one's broadband choices are limited to one or two providers.

If every location where Comcast operated broadband service there were four other equivalent providers of the same service, they would not ever think of cutting someone off for a year or limiting them to 250G/month of up+down transfers. These kinds of tactics are what monopolies do, simply because they can.

> If you go outside that, you get business service,

Actually in this case you get banned for a year without recourse.

It baffles me why they didn't just try to upsell the guy.

Possibly because their business service has a lot more competition than their residential service, hence lower margins.

Comcast business service is actually a bargain, at least around here. You pay maybe $15-$20/month more than you would for bare-bones residential service, you get to run servers if you want, suck down all the Netflix you can watch, and you get instant access to US-based tech support. Also, my understanding is that the various MAFIAA BitTorrent enforcers avoid targeting business-class IP ranges because unlike Grandma in her basement, businesses tend to put up a fight.

I wouldn't even think about going back to a residential account at this point. Given my household's usage patterns, I can't imagine Comcast makes any more money off of me than they would if I had a residential account, so I wouldn't expect them to upsell me aggressively if they were otherwise trying to get rid of me.

If you have a 100 amp power feed, then you should be able to use up to 100 amps. If you have a 100Mbit feed, you should be able to use up to 100Mbits.

The big difference between electricity and bandwidth is that electricity has to be produced and this involves considerable expense. Bandwidth is always there so long as the equipment is powered on, which ends up being a marginal cost in the scheme of things.

Look at how power is priced: $/KWH. Bandwidth is priced at $/Gbit. Not Gbyte, but Gbit. You pay for capacity and usage comes along for free.

I think you're confused about the difference between Gbit and Gbyte. One Gbyte is eight Gbits.

I think the confusion may actually stem from the fact that the OP intended Gbit to be Gbit/s (a rate, not a quantity).

You're confusing the last mile transmission capability with the cost of transferring the data in and out of the network.

Let's say you and I go in to business together and build a microwave wireless internet service. There is commodity equipment available that can push 100 mbps pretty easily. We buy a microwave transmission tower and central office from a company that is going out of business at a rate that cannot be beat. We price out our customer premises equipment so that we make half our money back on the setup fee, so setup costs are minimal.

We're now ready for business. We can provide 100 mbps internet service to customers with minimal equipment cost. Sweet!

Here's the rub. Unless our customers are content to transfer data only between themselves, we're going to need some outside connectivity. We need to peer with all the major networks. So we try to set up peering agreements with ATT, Level 3, and UUNet. The problem is, they have no need to transmit data over our networks, so we have a huge imbalance. We have to pay for every single bit our customers transmit.

It's time to rethink our 100 mbps bandwidth policy, is it not?

Just because we can transmit at 100 mbps to the customer, doesn't mean we can afford for them to use all that bandwidth all the time. There is a cost associated with transferring data over partner networks, and someone has to pay that cost. Comcast's residential pricing model does so in a way that is dead simple for consumers. If you don't fit that model, you should purchase business service.

We have to pay for every single bit our customers transmit.

What about all the bits your customers receive? You sound like you're at least somewhat familiar with peering agreements, so I'd like to know how that part works. If your customers are mostly receiving instead of sending, wouldn't those bits be paid for by the ones sending the bits?

For that matter, why can I get 200GB/mo at 50mbit/s plus a server for $20 from a VPS provider, and $.15/GB beyond that ($.10 if purchased in advance in the case of Linode)? Why do consumer ISPs need to charge so much more?

Based on your arguments in this and other posts, they have caps because they have to pay for the outgoing bandwidth. Why not just charge $.15/GB over the cap? Last mile infrastructure doesn't account for the difference, since it has a mostly fixed cost of construction and operation. Interfering with other oversubscribed customers can't explain it either, since everyone gets a fair and equal share of the pipe when the pipe is overloaded.

For that matter, why can I get 200GB/mo at 50mbit/s plus a server for $20 from a VPS provider, and $.15/GB beyond that ($.10 if purchased in advance in the case of Linode)? Why do consumer ISPs need to charge so much more?

The ISP has to maintain and upgrade thousands of miles of physical plant to deliver data to customer's homes in the geographic regions they cover. For a typical cable ISP for instance there's about 3-5 miles of copper between your modem and the the fiber node and typically dozens of miles between the fiber node and the provider's headend/datacenter where they uplink to the Internet -- which incidentally for smaller rural ISPs may itself be hundreds of miles away from competitive rates on data. Going back to the cost of maintaing/upgrading the infrastructure a small plant of only ~1000 miles typically requires at least a dozen full time employees simply to maintain it day to day and that's not including things like management, network engineers, customer service, technical support, equipment, contracted labour, customer installation, etc. On top of that you've got the cost of leasing access to the poles/underground conduits and the cost of powering the 3-5 miles of plant plus whatever operational costs you have to put gas into your fleet of vehicles, the cost of the vehicles themselves, insurance, etc. When you put this all together you're looking at some pretty huge overhead on the consumer side of Internet access plus whatever profit the company wants to make to justify all of the above. It's not a charity after all.

That still doesn't justify the 250GB cap. Once the line is installed and maintained, using it more or less doesn't change the cost of installing and maintaining it. At that point we're talking about bulk bandwidth, which if you live in a metropolitan area, cannot cost significantly more than what Linode is charging.

In the case of cable Internet you're dealing with a shared medium.

Your ISP may have a 10Gbit uplink in their headend but that does not extend to your home. In reality with 4 channel DOCSIS 3 bonding the speed available "on-the-wire" is about ~150Mbit/sec and it's shared between about 200 customers at minimum. (in reality it's usually a lot closer to 300-500 customers) So if 15 customers out of the 200 want to use 10Mbit/sec 24x7 there is no bandwidth left over for the other 190 customers.

Just to be clear this part is not strictly an infrastructure challenge as the physical cable plant is not inherently limited to ~150Mbit/sec. It simply depends how many DOCSIS channels are being sent out and how many customers share them. They originate from a CMTS in the provider's headend. A fully loaded CMTS sets you back about $500-$750k. So cable ISPs figured out capping data can save them quite a lot of money. The alternative is a) they make less money b) they charge the customer more. We know A certainly isn't going to happen in a non-competitive market and B is something most customers would not like so we get c) capping.

Telco or FTTH are a completely different beast though. Much harder to justify capping there. For telco it's usually because there is a limited uplink to the DSLAM. As of a few years ago it was not uncommon to have a few T1s feeding a DSLAM. FTTH is rarely capped because the fiber that goes to your home is capable of pushing 10Gbit/sec with the right optics. WISPS have the same issue as cable -- in fact WiMAX is very similar to DOCSIS and some WISPs actually do use DOCSIS over wireless at 10Ghz.

In the case of cable Internet you're dealing with a shared medium.

Your ISP may have a 10Gbit uplink in their headend but that does not extend to your home. In reality with 4 channel DOCSIS 3 bonding the speed available "on-the-wire" is about ~150Mbit/sec and it's shared between about 200 customers at minimum. (in reality it's usually a lot closer to 300-500 customers) So if 15 customers out of the 200 want to use 10Mbit/sec 24x7 there is no bandwidth left over for the other 190 customers.

I realize that the cable is shared, but remain unconvinced that a flat cap is in any way better than other solutions (such as dividing available bandwidth proportionally among active users, with higher-paying customers getting a larger slice). It shouldn't matter if someone's using their 10mbit/s 24/7, it should only matter if they're using it during peak hours. On the flip side, the "average" user who wants to stream Hulu, Youtube, and Netflix is likely to be doing their streaming at the same time as most other customers, causing more degradation to other customers' experience per hour of usage than the heavy downloaders. Capping the heavy users doesn't change the fact that the average users all want to stream video at the same time.

Also, how can the cable company possibly offer me the 50+mbit/s connection for which I currently pay over $100/mo if the 4 256-QAM downstream channels (totaling ~150mbit/s as you said) are shared by so many customers? Those channels only use 24MHz of the total spectrum.

I agree the flat cap isn't going to be the end of this. It just happens to be the easiest solution right now and the heavy users are low hanging fruit.

As for the 50Mbit on a 150Mbit bonding group -- that's he magic of oversubscription. It's amazing how little bandwidth people actually use. The number of heavy users who are doing 50Mbit/sec non-stop are really the fringe cases. It's actually quite hard to figure out how to max out a 50 or 100mbit/sec for long periods of time. The traffic patterns are extremely bursty. For example a single uncapped modem's traffic. (in MB/sec)

http://i.imgur.com/KL1YD.png

(120Mbit/sec is the bottleneck of my router)

You're definitely making the best counter points in this discussion. Unfortunately, I'm only familiar with peering agreements in so much that I can read about them on Wikepedia and follow links. The peering agreements are private, so we don't know who pays who.

Your questions regarding the fees for bandwidth are especially relevant. More things I can't address, because I don't know Comcast's costs for transport or last mile.

When I say that consumers won't/don't want a metered internet plan, I'm basing this on what's in the market and basic consumer tendencies toward simplicity. Metered services have a tendency to make customers feel "nickel & dime'd". Put plainly, consumers will choose a flat rate service over a metered service, even if the metered service would result in a lower bill [1]. It's basic risk aversion.

I'm of the opinion that "free market" ISP solutions aren't working out all that well. The necessity of public land-use rights in order to reach the last mile severely limits competition in the ISP space. I think that a good first step toward fixing the problem would be forcing some more transparency on ISPs. I'd love to know what's going on behind closed doors. I'd love to know who pays who. I'd love to know just how Comcast's transport costs break down.

Until we know some of these details, it's mostly speculation (yes, especially on my part), but I think there are some reasonable assumptions to be made.

1 - http://www.canavents.com/its2008/abstracts/109.pdf

Your electric utility service is capped, but they use a different method because electric utilities are metered. You have a fixed capacity feed to your house. For example, our home has 150 amp service. I cannot exceed that draw or the main feed breaker trips and everything goes dark. I can request installation of a larger feed, but I have to pay the build-out, and there are hard limits based on my local zoning.

One thing is certain, in no way do I have "unlimited" electricity available at my home.

That's not a cap, that's a throughput limitation, just like with an ISP. I'd be surprised if they stopped you from using your full 36kW 24/7 for a month as long as you were paying your $4k electric bill on time.

The reason for the cap is that Comcast has to make arrangements for transfer of that data to its destination, which will cross over in to other carrier's networks. Many of these agreements are made on trade between carriers, but if there is an imbalance, Comcast has to pay.

How does this square with Comcast charging Netflix for access to its customers? If Netflix is paying for the bandwidth, why do the customers have to pay as well?

The only alternative is metered transfer.

I think most people would be happy with metered transfer, but only if it is perfectly transparent and out of the control of the big media and pay TV companies. The metered price would have to reflect the decreasing costs of providing bandwidth, peering agreements would have to be open to public scrutiny, etc. The metered cost should start at something like $.10/GB and decrease over time, with a $5/mo connection fee to cover the amortized installation costs. There could be no allowance for ridiculous overage fees or total transfer caps.

> Your electric utility service is capped, but they use a different method because electric utilities are metered. You have a fixed capacity feed to your house. For example, our home has 150 amp service. I cannot exceed that draw or the main feed breaker trips and everything goes dark. I can request installation of a larger feed, but I have to pay the build-out, and there are hard limits based on my local zoning.

It sounds like the analogy here would be having an internet connection that has a maximum throughput of X. If you want X+Y, where Y is larger than zero, then you would have to buy a larger throughput connection. Once that's done, you'd be free to use it as much as you want, provided you pay for that usage.

That doesn't seem to be the case in the linked article here.

You're correct in your representation of the differences in the model, but I'm not sure anyone really wants the utility model. They might think they do, but they haven't done the math.

If Comcast has built a business around a 250 GB/month cap, they'd have to throttle your connection to 783 kbps to keep you under that cap (assuming you used your maximum connection all the time).

This whole notion that unlimited internet for $60/month is some kind of "right" is just preposterous.

That call is not yours to make. It was Comcast's to make, before they advertised exactly that. In the US, the Federal Trade Commission frowns on false advertising.