95th Percentile = Lame

Sun Jun 3 19:54:37 UTC 2001

I worked for Relcom ISP, and we just introduced this 95% billinfg as a big
advantage.

The reason (and idea) of 95% rule is very simple. If you (customer) overload your
link, you cause a lot of extra (unpayed) traffic inside
your ISP; without this rule you will not want to upgrade and so waste bandwidth
payed by the otheer customers.

May be, 95% is not the best way to measure overload (packet loss is better) but at
least this work, and so UUnet was smard introducing this rule.

Are there alternatives to this? Of course, they are - provide worst
(oversubscribed) performance, or bill by every byte (we did it, too),
or get out of the business.

Of course, other telecommunications does niot use such rule - they just charge you
for the full bandwidth no matter do you use it or not. It's the difference.

----- Original Message -----
From: "James Thomason" <james at divide.org>
To: <nanog at merit.edu>
Sent: Sunday, June 03, 2001 11:39 AM
Subject: 95th Percentile = Lame

>
>
> If I am not mistaken, the true "benefit" to 95% billing is that it allows
> the provider to charge for bits they never delivered.  The average will
> skew on a burst of traffic (>5% of the average) and you pay for it as if
> you had averaged that level the entire time.
>
> It seems like quite an irrational settlement model. Why not simply bill
> for every bit that crosses your network?  There certainly is a per-bit
> cost.
>
> I cannot, off the top of my head, think of another telecommunications
> industry that relies on a system of averages for settlement.  It speaks
> pretty clearly of how immature the Internet industry really is.
>
> Or maybe not.  Perhaps the electrical suppliers here in California
> should bill in the 95th percentile, and cite the Internet as a rational
> example.
>
> Regards,
> James
>
>