Capacity/transit costs vs growth

Jean-Francois Mezei jfmezei_nanog at
Wed May 27 21:36:23 UTC 2015

I am looking for some rough estimates of the ratio of capacity
(equipment) pricing declines versus average increase in end user capacity.

For instance, say end user average capcity usage increases 50% over 3
years, would the ISP's costs also increase by 50% ? Or would increased
efficency of equipment result in a 50% decrease in capacity costs
yielding roughly the same total cost to the service provider ?

So I am looking are some sort of ratio of gross costs
increases/decreases relative to end user usage increase in usage over time.


Wholesale services in Canada are priced linearly and there is a process
trying to convince the CRTC to review them ASAP.  So if average use
grows from 1mbps during peak to 1.2mbps, we are looking at 20% increase
in costs in a linear pricing scheme. But if this happens over a period
where there have been improvements in equipment/efficiency, then one
would think the increase in costs would be less than 20%.

So I am looking for any and all information that can help convince the
regulator that current linear increase is not right and needs a review.

any help appreciated.

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