More Sidgemore on per-bit pricing

David Diaz davediaz at
Wed Dec 9 03:19:21 UTC 1998

I know this is a bit late sorry...

Well what if I had a xDSL local loop from someone like Northpoint for
something like $150 and then did the per bit model.  A T1 (or even slightly
less) for $350 starts to look rather attractive to a lot of people.

At 3:05 PM -0500 12/5/98, Daniel Senie wrote:
>Barry Shein wrote:
>> One possible positive effect (for the consumer) of "per-bit" pricing
>> is the opportunity to buy larger pipes but only pay for what you use.
>> Right now flat-rate pricing mostly assumes you're going to, within
>> some statistical model, actually use the bandwidth you get, or
>> certainly that someone buying a DS3 is going to use a lot more
>> bandwidth, on average, than someone with a DS1.
>> [Rest of post deleted for brevity]
>I wonder if the northeast is more expensive than elsewhere, but from my
>recent shopping for T1's for myself and my clients, I find the cost of
>the service over a T1 isn't the budget buster. For one location, all T1
>circuits (before buying IP service, just the telco charge) is $613 a
>month. To another location, the circuits are $900 to $1500 a month.
>Adding $500 to $1000 on top of that for full-rate service, vs. adding
>$200-$500 on top of that for "burstable" service just doesn't generate
>much excitement.
>Until the base telco circuit prices are lowered dramatically, the
>pricing of packet service over them, while not "noise," is certainly
>less interesting.
>Now, if the whole circuit, T1 and IP packet service, were all priced on
>the basis of traffic, that'd be interesting. An underutilized T1 would
>incur some small base charge, plus traffic/usage increments beyond that.
>That'd be quite attractive, though I doubt the phone companies would
>think so.
>Daniel Senie                                        dts at
>Amaranth Networks Inc.  

Thank you,
David Diaz
Chief Technical Officer
Netrail, Inc

email:   davediaz at
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