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Re: The Great Exchange

  • From: Julian Rose
  • Date: Tue Jun 02 07:18:36 1998

Some crystal ball gazing... 

I expect to see an amount of distance billing in the future, but only
alongside QoS billing, for example.

Email - Non urgent, low traffic - I would expect this to remain flat rate
(i.e. Free with connection).  As with browsing traffic etc.  Caches will
add an intersting factor to this model, e.g Retrieving files from the ISP's
local cache - (Free with connection), Retrieving from distant locations,
perhaps dependant on time of day etc.

Voice over IP - This is starting to get bandwidth and delay sensitive
dependant on the efficiency of the Internet in the future, I expect this
might start to be billed dependant on distance/providers travelled over
etc.  As otherwise if two ISP's do not directly connect or peer, an
intermediate ISP would have to carry this traffic.  If this traffic
requires a high QoS, I would imagine the intermediate ISP would want to
charge for it.

Video over IP - When it comes around and end users via their xDSL
connections want to receive 1.5Mbs of video traffic - I can see definate
costs being incurred.  Of course multicast techniques, caching etc will
make this not a geographical distance based pricing model, but a pricing
model will surely evolve.

Of course this argument of carrying others traffic applies to peering also,
if two ISP's peer a similar amount of data, no problem, but if it is one
sided then billing would have to occur.  In other words, we will all buy
and sell our connectivity to each other.

One thing this state of affairs would lead to if it occurs is some scope
for very interesting pricing models, value adds etc.

A topic measured earlier was the ratio between payroll/equipment costs vs
line costs.  The ratio of this will depend on the model of the ISP.  A
dialup provider will incurr much higher support costs for a much smaller
bandwidth than a transit/backbone provider, which the line costs would be
expected to be the majority of their costs.

... Perhaps a bit more than 2 cents...

Julian Rose
              Internet Planning & Design
AT&T Unisource Communications Services, Hoofddorp, Holland
 Tel: +31 (0)23 569 7878          Fax: +31 (0)23 569 7455

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