As a point of information, Australia is one of the few places where
the government collects Internet traffic statistics (which are hopefully
trustworthy). Pointer is at
(which also has a pointer to Hong Kong reports). If one looks at the
Australian Bureau of Statistics report for the quarter ended March 2007,
we find that the roughly 3.8 M residential broadband subscribers in
Australia were downloading an average of 2.5 GB/month, or about 10 Kbps
on average (vs. about 20x that in Hong Kong). While Australian Internet
traffic had been growing very vigorously over the last few years (as
shown by the earlier reports from the same source), growth has slowed
down substantially, quite likely in response to those quotas.
P.S. The MINTS (Minnesota Internet Traffic Studies) project,
provides pointers to a variety of sources of traffic statistics, as
well as some analyses. Comments, and especially pointers to additional
traffic reports, are eagerly solicited.
> As you say, 90GB is roughly .25Mbps on average. Of course, like you pointed
> out, the users actual bandwidth patterns are most likely not a straight
> line. 95%ile on that 90GB could be considerably higher. But let's take a
> conservative estimate and say that user uses .5Mbps 95%ile. And lets say
> this is a relatively large ISP paying $12/Mb. That user then costs that ISP
> $6/month in bandwidth. (I know, that's somewhat faulty logic, but how else
> is the ISP going to establish a cost basis?) If that user is only paying
> say $19.99/month for their connection, that leaves only $13.99 a month to
> pay for all the infrastructure to support that user, along with personnel,
> etc all while still trying to turn a profit.
In the Australian ISP's case (which is what started this) it's rather
The local telco monopoly bills between $30 and $50 per month for access
to the copper tail.
So there's essentially no such thing as a $19.99/month connection here
(except for short-lived "flash-in-the-pan" loss-leaders, and we all know
how they turn out)
So to run the numbers: A customer who averages .25Mbit/sec on a tail acquired
from the incumbent requires --
Port/line rental from the telco ~ $50
IP transit ~ $ 6 (your number)
Transpacific backhaul ~ $50 (I'm not making this up)
So we're over a hundred bucks already, and haven't yet factored in the
overheads for infrastructure, personnel, profit, etc. And those numbers
are before sales tax too, so add at least 10% to all of them before
arriving at a retail price.
Due to the presence of a quota, our customers don't tend to average
.25 Mbit/sec over the course of a month (we prefer to send the ones
that do to our competitors :-). If someone buys access to, say,
30 Gbytes of downloads per month, a few significant things happen:
- The customer has a clear understanding of what they've paid for,
which doesn't encompass "unlimited access to the Internet." That
tends to moderate their usage;
- Because they know they're buying something finite, they tend to
pick a package that suits their expected usage, so customers who
intend to use more end up paying more money;
- The customer creates their own backpressure against hitting their
quota: Once they've gone past it they're usually rate-limited to
64kbps, which is not a nice experience, so by and large they build
in a "safety margin" and rarely use more than 75% of the quota.
About 5% of our customers blow their quota in any given month;
- The ones who do hit their quota and don't like 64kbps shaping get
to pay us more money to have their quota expanded for the rest of
the month, thereby financing the capacity upgrades that their
cumulative load can/will require;
- The entire Australian marketplace is conditioned to expect that
kind of behaviour from ISPs, and doesn't consider it to be unusual.
If you guys in North America tried to run like this, you'd be
destroyed in the marketplace because you've created a customer base
that expects to be able to download the entire Internet and burn
it to DVD every month. So you end up looking at options like
DPI and QoS controls at your CMTS head-end to moderate usage, because
you can't keep adding infinite amounts of bandwidth to support
unconstrained end-users when they're only paying you $20 per month.
(note that our truth-in-advertising regulator doesn't allow us to
get away with saying "Unlimited" unless there really are no limits --
no quotas, no traffic shaping, no traffic management, no QoS controls.
Unlimited means unlimited by the dictionary definition, not by some
weasel definition that the industry has invented to suit its own
- There is no net neutrality debate to speak of in .au because everyone
is _already_ paying their way.
Like I said a few messages ago, as much as your marketplace derides
caps and quotas, I'm pretty sure that most of you would prefer to do
business with my constraints than with yours.