The way I understand it is that Telecom does not charge the ISP for data
volume for JetStart.

However the ISP does have to connect to the WWW, and they have to pay for
that connection to some backbone provider. There are several providers
including Telecom, Clear, IHug etc. I am unsure what pricing models they use
but they probably offer different options.

I think it would be a mistake to assume that international bandwidth is the
sole, or even the major, reason for usage charging. If you look at Paradise
they offer 10 GB for $ 30. If this was meant to cover international
bandwidth then their bandwidth only costs .3 cents per megabyte.

I think the Paradise usage cap stops the really big leechers from hammering
the service (see how many have moved to other ISPs) but is large enough that
Joe Bloggs are comfortable that they will not exceed the limit (so it is a
'virtual flat rate' plan). A basic tenet of network design is to scale it to
the average user, and usage plans can be a means to stop the larger users
from artificially increasing this average (and if they do go over then you
could use revenue from them to subsidise the network). I know Ihug used to
say that 5% of their users did 90% of their traffic.

The other aspect is that different ISPs have better or worse caching
capabilities thatwill greatly impact their international bandwidth costs.

By the way I have no problems with leechers. If ISPs do not have mechanisms
to stop unprofitable leechers then that is their problem. However Leechers
should remember that, in the end, the ISP is a business and if leechers are
not profitable the ISP will be forced to change their business model
(possibly to the detriment of all users)

regards,

P
----- Original Message -----
From: "Paul Brislen" <Paul_Brislen@idg.co.nz>
To: "Jp Wise" <jpwise@softhome.net>
Cc: <adsl@lists.unixathome.org>; <zsolt.brandt@ihug.co.nz>
Sent: Saturday, March 02, 2002 1:08 PM
Subject: Re: Xtra Js cap... IDGNet story

>
> Sorry guys, looks like there's some problem with the IDG server
> currently... not entirely sure what but I can't fix it from here so I'll
> copy the story in below.
>
> Basically what's happening is Xtra (not Telecom) is reviewing the service
> and MAY consider putting a bandwidth cap on. It's only a possibility at
> this stage, as it was explained to me, and is in NO WAY CERTAIN.
>
> What does that mean? I think if you bombard Xtra with
> emails/letters/calls/carrier pigeons/whatever telling them why you don't
> want a bandwidth cap and what your point of view is then you'll stand a
> good chance of getting your message across. The Xtra spokesman I spoke to
> (Matt Bostwick) told me they would like to hear from high-end users (aka
> The Bad Apples Who Spoil It... yadda yadda) to find out if there isn't a
> service offering at that end that nobody is providing. I would hazard a
> guess that there isn't and that money could be made offering such a
> service. Now you've got to convince them of that.
>
> It's certainly more of a pricing model issue than it is a technology
issue.
> Telecom charges the resellers of DSL (all the other ISPs) a per megabyte
> charge (as I understand it) and if you spend 24/7 downloading from the
web,
> the ISP ends up paying Telecom for the privilege of having you as a
> customer... any ISP guys care to correct me if I'm wrong on that?
>
> My questions are:
>
> - How much does Telecom typically charge ISPs for that traffic? How much
> does 10GB per month per user cost the ISP for example?
>
> - Who pays the support costs of maintaining those customers?
>
> - Are all the ISPs getting their bonus payouts for adding DSL customers to
> the Telecom network the way they're supposed to?
>
> Peter Griffin at the Herald has an interesting story up that basically
says
> ISPs can't make money off the DSL pricing model in place at the moment.
> I've got a call in to Telecom's DSL product manager Kevin Kenrick about it
> -- either he or the PR people aren't responding terribly quickly but then
> it's only been a month.
>
>
http://www.nzherald.co.nz/storydisplay.cfm?storyID=1040186&thesection=techno
logy&thesubsection=general
> JetStream barely worth it - ISPs
>
>
> This is the IDG Net story I wrote:
>
>
> The country's largest ISP, Xtra, is reviewing its JetStart DSL package and
> may consider including a data cap on the service.
>
> JetStart is Telecom's flat rate DSL service that runs at 128Kbit/s. The
> flat rate differs between ISPs, but Xtra charges $64.90 per month. A
number
> of reseller ISPs have initiated download caps because of a handful of
users
> taking full advantage of the service.
>
> Xtra spokesman Matt Bostwick says it is early days yet and that some kind
> of data cap is one option. "But it's only part of the review."
>
> Bostwick is keen to avoid interfering with the vast majority of users who
> don't use several gigabytes of traffic each month.
>
> "This is a path a number of industry players have gone down and we have to
> look at it."
>
> Bostwick says Xtra has already begun to enforce its current terms and
> conditions which include a "no server" clause for JetStart users, some of
> whom were serving files via file sharing programs like KaZaA and Morpheus.
>
> "We're also keen to talk to those users who are at that high end to see if
> there isn't room for some kind of service targeting their needs," says
> Bostwick. He cites the JetStream game servers as a good example of this.
>
> "There we know exactly what sort of traffic to expect so we can set up a
> service to meet that need."
>
> Quicksilver is the latest ISP to introduce a cap, restricting the service
> to 7GB a month, according to managing director Matthew Hobbs.
>
> "There aren't a lot of them using the service to that level but there are
> enough doing it to make it unprofitable for us."
>
> Hobbs says Quicksilver is currently looking at moving the cap to 10GB a
> month, although he says the main impact of the plan is from simply having
a
> cap in the first place.
>
> "It lets them know that they can't do that here, so they tend to go
> elsewhere." Hobbs says he wants to avoid impinging on the experience of
> "regular" users.
>
> Paradise, one of TelstraClear's ISPs, also has a cap on JetStart usage,
set
> at 10GB a month. Downloads that exceed that point are charged at 20 cents
> per megabyte for international traffic or 2 cents per megabyte for
> national. Quicksilver users aren't permitted to exceed the download limit
> each month.
>
> Cheers,
>
> Paul
>
> --
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>

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