More Sidgemore on per-bit pricing

Sat Dec 5 23:07:35 UTC 1998

On December 5, 1998 at 14:28 karl at denninger.net (Karl Denninger) wrote:
 > Absent BOTH of those on a worldwide basis and I could never justify
 > recommending to anyone that they accept such a pricing system.

Of course you could, if the per-unit cost were the same, pro-rata, as
paying for the whole thing. So if the choice was between paying
$48K/mo for a DS3 vs $2K/mo for each DS1-equivalent the worst case is
$48K/mo anyhow so may as well take your chances with crooks.

I'd argue that even at some premium, unless you're normally using
almost all of it, you'd still probably be better off on average even
if a crook gives you a bad week once in a while. $24K + $6K for a
crook is still a lot less than $48K guaranteed, crooks or not. Etc.

And there's probably going to have to be some accomodation (e.g.,
credits, refunds, more vigorous enforcement and detection of abuse by
sellers) with any such pay-per-bit scheme. Particularly if, as I
predict, it becomes a major way to sell a lot of very high bandwidth
lines (155mb+) to customers who otherwise wouldn't consider so much
bandwidth if they had to pay for all of it all the time.

You're right that something has to be done, but I don't particularly
accept that the situation is so untenable. On a service like this a
credit for a bad week with a crook doesn't really drive the provider
under either, particularly if they make some effort to prevent it
(e.g. prosecuting abusers, detecting and blocking abuse quickly, etc.)

I'd guess that one model which might work well is whitelisting: I want
on-demand bandwidth up to, say, 155Mb/s to this short list of sites
(VPN-ish), but only T1 to everyone else to prevent abuse.

-- 
        -Barry Shein

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