Usage Caps: Hidden and Invisible

I’ve been thinking about it, usage caps make sense, but the implementations that providers are offering don’t, with these arbitrary usage caps, that are mostly hidden. There is already a theoretical cap, that for all current intents and purposes seems invisible. That theoretical cap exists do to the maximum bandwidth that the provider supplies you with.

Let us look at some of those numbers. I’ll start with a simple example for a 1Mb/s connection and assume that this contains both up/down streams.

1Mb/s connection = 1/8th of a MB/s ;

MB/30 day month = 60s*60m*(24h/8)*30d = 324000 MB/month = ~325GB/month.

That’s the invisible bound on a 1Mb/s connection for 30 days, you can’t achieve greater than ~325GB/month. Then you have to factor in decay caused by latency and dropped packets on the line and assume maybe 90% capacity is possible, which brings you further down to ~290GB, realistically.

Taking that information, I think I would start people off with a percentage based amount of their bandwidth. I’d start off with a provision of a 40% utilization(~130GB/month), and allow it to be increased/decreased. It’s entirely possible that this is too high of a utilization offering to start with; for example,  when you get to 5Mb/s lines that same 40% is ~650GB/month. On the other hand, some companies want to cap it at 250GB/month which is less than 20% utilization of a 5Mb/s connection. It is my belief that they need to scale their utilization cap with their speed offering; to me, it doesn’t make any sense, otherwise.

If I can do this math, I’m sure they can and have done it as well. They already know what they are theoretically being asked to provide at peak times, and also what they’re capable of handling. How hard would it be for them to optimize this, and increase their efficiency?

Maybe offer a 10% utilization at 1Mb/s(~32GB) as a baseline, for those like RMS who don’t use the web with the exception of email? Then they can automatically roll you into the next 10% for the month, if you go over that limit. You automatically get rolled up 5 or 10%, at some percentage of cost. Once you have the roll over and initial utilization provisions determined, you can go about extrapolating and targeting different areas of what you provide.

Lets assume that you start with a base fee of maybe $10 + taxes and then a rate for bandwidth/speed similar to this:

For a 1Mb/s  plan: 32GB(10%) @ $10, 64GB(20%) @ $12, 96GB(30%) @ $14, and 128GB(40%) @ $16.

For a 2Mb/s plan: 64GB(10%) @ $15, 128GB(20%) @ $18, 192GB(30%) @ $21, and 256GB(40%) @ $24.

For a 4Mb/s plan: 128GB(10%) @ $25, 256GB(20%) @ $30, 372GB(30%) @ $35, and 512GB(40%) @ $40.

You can extrapolate further.

Maybe my scaling is a little off, a little too linear, as I’m not really accounting too much for trying to limit peak loads. Also I’m starting each tier at roughly the cost of the tier below at 35% utilization. There are lots of inefficiency in my model, but that’s because I don’t have the actual data required to see if this is feasible. I think it is still better than their blind caps that they try to hide.

If you have any thoughts or suggestions on how this could be done, or if it’s feasible, leave a comment.