Why do some ISP's have bandwidth quotas?

Sat Oct 6 21:54:17 UTC 2007

On Sun, 7 Oct 2007, Mark Newton wrote:

> We're living in an environment where European service providers use
> DPI boxes to shape just about everyone to about 40 Gbytes per month,

This doesn't fit with my picture of european broadband at all. Most 
markets are developing into flat rate ones without per-minute or 
per-traffic charges, and residential broadband is closing in on 50-70% 
market penetration all across the continent, with the northern part being 
a bit ahead of the southern part.

Competition is so fierce that a lot of ISPs are electing to get out of 
certain markets due to uncertainty of future profits even with quite slim 
organisations and tight budgets on technology without ATM etc (IP dslams). 
France for instance, it's hard to make any money unless you sell triple 
play and try to make total profits on the combined services, just selling 
one doesn't work.

It's not uncommon for low-bandwidth (.25-.5 megabit/s) residential access 
to be in the USD15/month range and 24 meg costing USD30-50 per month 
including tax. This is without any monthly quota at all, ie flatrate.

5-10% of swedish households have the possiblity to purchase 100/10 over 
CAT5 for USD50 a month including 25% sales tax, without any quota, and 
they can actually use the speeds. Some even have 100/100.

Recipe for this is to have competitive markets with copper being 
deregulated and resold at a decent price. Bitstream with incumbant 
providing access just doesn't work, new services such as multicast IPTV 
doesn't work over bitstream.

In a lot of continental europe ISPs can purchase wholesale internet in the 
gigabit range for USD6-15/meg/month depending on country and if it 
includes national traffic or not.

Having a competitive market with a lot of players makes all the 
difference.

-- 
Mikael Abrahamsson    email: swmike at swm.pp.se