[73183] in North American Network Operators' Group
Re: Current street prices for US Internet Transit
daemon@ATHENA.MIT.EDU (Patrick W Gilmore)
Mon Aug 16 14:13:13 2004
In-Reply-To: <5.1.0.14.2.20040816091334.039ceb48@pop.sbcglobal.yahoo.com>
Cc: Patrick W Gilmore <patrick@ianai.net>
From: Patrick W Gilmore <patrick@ianai.net>
Date: Mon, 16 Aug 2004 14:05:42 -0400
To: nanog@merit.edu
Errors-To: owner-nanog-outgoing@merit.edu
On Aug 16, 2004, at 1:16 PM, William B. Norton wrote:
> Thanks to all who replied with data, and yes, the pricing was all 95th=20=
> percentile.
>
> Wow - the U.S. has an amazingly unhealthy and cut throat transit=20
> market in 2004.
Mind if I ask why you think it is "unhealthy"?
I suppose an argument could be made that this is "below cost", but=20
since you are not a provider and do not sell transit, I would hope the=20=
people doing so know their costs and margins better than you do.
Unfortunately, I doubt any transit provider offering these prices will=20=
tell us if they are below cost. (Someone care to prove me wrong? :-) =20=
But since this is not 1999, I'm guessing at least SOME of them are=20
profitable, and therefore the costs are not necessarily unhealthy. So=20=
perhaps you should be more careful of your characterization?
> A couple people said these prices were TOO HIGH, particularly for the=20=
> gig commit, although several multi-gig commits came in tiered; for=20
> example, $45/Mbps for 1G commit, $35 for 2G, etc. on down to $21 for=20=
> 8G commit. (One Tier 2 ISP said that they sold 1G commit as low as=20
> $18/Mbps, presumably simply reselling Tier 1 BW so the difference may=20=
> be negligible.)
Having been a "Tier 2" (several, actually :), I can tell you that it is=20=
not "simply reselling Tier 1 BW" - which you should know, providing a=20
service to allow Tier 2s to do more than resell transit from a bigger=20
network....
> Given the adjustment, I thought you might be interested in how the=20
> U.S. transit prices compare against a handful of other Peering=20
> Ecosystems:
>
> The Cost of Internet Transit in=85
> Commit AU SG JP HK USA
> 1 Mbps $720 $625 $490 $185 $125
> 10 Mbps $410 $350 $150 $100 $80
> 100 Mbps $325 $210 $110 $80 $45
> 1000 Mbps $305 $115 $50 $50 $30
>
> Round numbers anyway FWIW. Hope this helps. I feel bad for those=20
> selling transit these days - at these prices, margins must be mighty=20=
> thin, and I suspect we will see some more turbulence in the industry.
Those are apples & oranges. You cannot compare bandwidth in countries=20=
without the same fiber infrastructure as the US ( and with government=20
owned PTTs controlling almost all access to the US market. Not to=20
mention other differences which just don't translate.
I notice that you do not list a single EU country. Prices there are=20
much closer to the US.
Anyway, I suspect "more turbulence in the industry" for the next few=20
millennia, no matter where prices are. :-)
--=20
TTFN,
patrick=
