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[ NNSquad ] Re: L.A. Times Biz Section/Lazarus: "We can't be neutral on net neutrality"

It's quite possible to implement traffic shaping on shared capacity. If the capacity is dedicated then the usual pricing is based on the bit rate of the access line. Even with dedicated access lines it is possible that the last mile infrastructure is still shared (cf common implementations of cable access to Internet). Maybe we need to distinguish dedicated access lines from shared access. In the former case, it has long been the practice to price according to the bit rate and to allow all you can eat. In the case of shared capacity, you typically buy "up to X" (or maybe "at least X") bits/second, but if the shared access system becomes congested, you get your pro-rata share of the congested capacity. Pro-rata in this case means a pro- rata share of the absolute bit carrying capacity of the shared access link. When the system is NOT congested, it usually does not cost you any more to inject or receive data up to the absolute rate of the shared access system.


On Aug 30, 2009, at 12:56 PM, Stefano Quintarelli wrote:

Vint Cerf wrote:
no i am not in favor of volume pricing; i am in favor of capacity (bit/second) pricing.

I think that, if you you're an operator doing ULL, and you have a fibre backhauling, then the vast majority of costs you incur in, is the ULL line rental which is not charged on bitrate but rather a fixed amount per pair. therefore, your costs are essentially fixed. will you limit the capacity to x Mbps while the access line could bear X Mbps ? one of your competitors will not and he will get the customers.

It seems to me that capacity pricing can work where costs are somewhat capacity related (e.g. where you don't have fibre backhauling, where you don't have mandatory ULL to the incumbent,...) but, otherwise I have the impression that you might end up having just one capacity class which is full capacity.

ciao, s.

-- blog.quintarelli.it www.eximia.it www.reeplay.it