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

[Vint Cerf <vint@google.com>]

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.

vint

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.
>
>
> --
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