Dave Rand dlr at
Sat Aug 22 14:14:08 UTC 1998

[In the message entitled "Re: BBN/GTEI" on Aug 21, 23:20, Bruce Hahne writes:]
> >On-net facilities have made distance-sensitive pricing in most metro areas a
> >thing of the past. Sub $0.04 per DS0-mile long-haul rates have made long
> >haul circuits very affordable.  High speed WDM dark fiber routes will make
> >long haul very, very cheap in the next 2 years.
> This is the old "bandwidth is so cheap that it's free" argument.  True,
> bandwidth is now inexpensive enough for a single DS0 that it's becoming
> counterproductive, from a marketing standpoint, for the telco to attempt to
> differentiate based on distance for a voice call.  But if we're ever to
> arrive at the day when I can turn on my 100Mbps video-over-IP feed to my
> home PC over my FTTH connection, and expect to actually get reasonable
> performance, we're probably going to need both metering and inter-provider
> settlements.

What I said was "distance-sensitive pricing in most metro areas" is
not a market reality.

Billing for bandwidth used is a good thing.  Billing for
packet-flow-ds0-miles-per-aardvark is madness.

Figure out what your costs are, and bill your customers appropriately. 
A customer in Borneo is going to have to pay more that a customer
in Borneo, Idaho, who may have to pay more than a customer in Dallas,
who may have to pay more than a customer in New York.  Large metro
areas have economies of scale that make very high speed pipes available.

Dave Rand
dlr at

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