Interesting People mailing list archives
Re: IP: The real bandwidth numbers.
From: David Farber <dfarber () earthlink net>
Date: Thu, 11 Apr 2002 13:07:53 -0500
-----Original Message----- From: Aditya <aditya () mighty grot org> Date: Thu, 11 Apr 2002 10:43:21 To: farber () cis upenn edu Subject: Re: IP: The real bandwidth numbers. For IP, if you want. Dave, although ISP margins haven't ever been great (unless you happen to own your own rights-of-way *and* got reciprocal-comp without spending huge amounts on buildout), they've been enough to make a profit on if you don't strive to be the low-price leader. In a past business (we were the second ISP in California to offer DSL) we charged $65/mo for unlimited bw residential DSL (384/128, loop plus IP transit) based on an average of 10kbps per user usage at *peak*. The telcos (PacBell and Covad) charged us around $35/month for the loop. We made a profit and would have continued to do so. We sold the business because it was time to do something new. Adi On Thu, Apr 11, 2002 at 05:05:54AM -0400, Dave Farber wrote:
------ Forwarded Message From: "Adam L. Beberg" <beberg () mithral com> Date: Wed, 10 Apr 2002 21:43:28 -0700 (PDT) To: <farber () cis upenn edu> Subject: The real bandwidth numbers. Since you posted about what it costs to be a wireless ISP, It might also be interesting to look at an old writeup I did of wired costs back in January, since you still have to plug the wireless into the net somewhere. Some people pointed out I seem to be off by by 2x, and I pointed out you need to buy enough to handle use at 5pm or people go elsewhere. - Adam L. "Duncan" Beberg http://www.mithral.com/~beberg/ beberg () mithral com ------------ So, I've been pushing some numbers back and forth with a friend who runs a fairly large ISP. The job of an ISP is to move bits. They do lots of colocation, dialup, and DSL, so they have the economies of scale going for them with a good mix of customers. They have been around over 10 years, so it's not some dot-com run by dot-idiots either. Also important to keep in mind is that this is in a city with flatrate (cheap) phone lines, also "one hop" from the main trans-US backbone, thus cheap bits. Anywhere outside North America and you are talking _seriously_ higher numbers - add a zero. So here's how it boils down (in US dollars): $1.75/GB for the bandwidth coming in and out of the cables to the backbone companies - the wholesalers, Sprint, MCI, Qwest, etc. Now, once you add employees, routers, power, AC, phones, etc etc... $12.88/GB. ... $7.75 for a 600MB CD image (41 hours modem, 2 hours DSL). $2.83 for a 220MB MPEG of your favorite 30 min TV show (commercials removed) $0.06 for a 5 minute MP3 file (20 min modem, 1 min DSL). Compare this to $1.00 postage included, for a logo encrusted CD via US postal service - which is still cheaper then if you use the "just for a cable in the wall" cost above. And video tapes are really cheap too. Shipping alot of bits over the internet is not cost effective at all. A modem can move about 7GB/month. 768kb DSL can move about 150GB/month even with those really slow hours during the day. I leave for the reader to calculate how many DSL customers you need at $40/month running gnutella to make a profit :) Enduser per-GB rates are coming. ------ End of Forwarded Message For archives see: http://www.interesting-people.org/archives/interesting-people/
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Current thread:
- IP: The real bandwidth numbers. Dave Farber (Apr 11)
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- Re: IP: The real bandwidth numbers. David Farber (Apr 11)
- Re: IP: The real bandwidth numbers. David Farber (Apr 11)
- Re: IP: The real bandwidth numbers. David Farber (Apr 11)
- Re: IP: The real bandwidth numbers. David Farber (Apr 11)