My tiny ISP

I shouldn’t be, but I’m always surprised when even geeks don’t really understand how fibreoptixbandwidth and its pricing at the enterprise level works.

Most of the people in that thread are utterly clueless. I’d guess that at least one is working for Comcast (since it has been shown that they have thousands of shill accounts out on the web).

Let’s pretend I was starting my own very small ISP.

I’m going to omit some nuance and jargon here, but right now at an enterprise level you can get each Mbs for around $0.50 (fifty cents) per month. So that means a Gb/s link would run my tiny ISP around $500 per month. At an oversubscription rate of 40:1 my bandwidth costs alone for one subscriber should be about $12.50.

Also note that this is the highest-cost scenario possible.  Most major ISPs who run their own transit links pay approximately 1/100 to 1/200 of this actual cost, some much less even than that.

art-paint-painting-spider-web-spider-webs-watercolor-Favim.com-71123As I said, I’m developing this as the highest cost possible, like I was going to start my own ISP for a very tiny user population.

Note that the 1Gbs mentioned above is not your piddling home connection. This is the connection that your actual ISP or similar would use. (I’m being slightly inaccurate here, unless you have a small ISP, but being very accurate would take a thousand words. Large ISPs who run their own transit pay much, much, much less as already mentioned.) This is guaranteed with a rock-solid service-level agreement and would have 99.999% uptime. It also would include a 5% burst to 10Gbs.*

Comcast wants to have an oversubscription rate of 70:1 or higher. A reasonable oversubscription rate would be my 40:1 or so.

So I start my own ISP. My actual bandwidth cost per my 40 users is $12.50 per month. That means I offer all of them a 1Gbs connection assuming like most users that 95% of the time that everyone won’t be downloading at 100%. (Note: this is how all ISPS work. All of them. Every last single one that you’ve ever used.)

So even the tiniest ISP in the universe still has pretty small bandwidth costs, still with far better low_poly_abstract_art_by_juggerz-d5ulfwooversubscription rates than Comcast.

Assuming for the sake of minimizing the complexities and having a comparable scale that my little ISP’s users all live in the same building, I could charge these users $60 a month and still make a huge profit. (Before anyone gets into it, infrastructure costs amortized over 20-40 years are really tiny. Look it up yourself, it’s right in the 10Ks and 10Qs of any public ISP. In addition, a lot of that is and has been paid for by taxpayers and not by ISPs.)

That should give you some idea just how much Comcast and the like is overcharging for terrible service.

I’ve tried to minimize jargon and other industry patter in this piece, but there is no way to reduce it that much more. But if there are any questions, feel free to ask.

*Meaning that 5% of the time, the connection could burst to 10Gbs with no extra fees to me.