[586] in Commercialization & Privatization of the Internet
Re: At What Price Will TCP/IP Connections Gain Wide Market Appeal?
daemon@ATHENA.MIT.EDU (Edward Vielmetti)
Sun Apr 14 20:24:31 1991
To: Will@cup.portal.com
Cc: com-priv@psi.com
In-Reply-To: Your message of Sun, 14 Apr 91 15:54:06 -0700.
Date: Sun, 14 Apr 91 20:23:12 EDT
From: Edward Vielmetti <emv@ox.com>
Will,
At the very low end of the market (less than $3000/year) there is a lot
of hope that connections will be reasonable and plentiful; at the very
least, there should be interest from the 2000+ (est.) sites which are
already paying up to $1500/mo for dial-up uucp connections. There's a
market out there -- it's the great unwashed uucp universe which is slowly
but surely going to get attached to the internet one way or another.
There are numerous ways that you can make service distinctions at the
lowest end of the market; I'll enumerate some of them. Some of the
lowest function services have low marginal costs if you have a network
already in place, and could serve well as that first bit of highly addictive
narcotic to get your customer hooked to higher and higher service levels.
First question dial-up internet service is -- bill by the month or by
the hour? If you bill by the hour, you might be able to get the monthly
cost down low enough ($35? $50?) so that someone who already is paying by
the hour for a UUCP connection for their news and mail could use your
services to do anonymous FTP's to remote parts of the network without any
hassle. bits is bits, bill at the hourly rate, and enforce all of the
necessary restrictions to make them OK to traverse the NSFnet.
If you bill by the hour on your normal UUCP lines then this won't look
too bad. You won't have to worry about customers complaining about busy
signals so much cause they're not paying for them.
If you bill by the month, that means more dedicated equipment. With modern
dial-up IP software, scarce but appearing more often, it's possible to
give the illusion of a dedicated link without actually having one (telebit
netblazer, bbn dialup-ip). Now the question becomes -- do you assign the
customer a permanent IP address of their very own which they can accept
mail to, have people telnet into etc., or do you hand out a different
address every time they dial in? The PSI service as I understand it
is $175/mo but a floating address; if that really is the right price, then
you should be able to get at least $25 or $50/mo more to fix the addres
in the same place every time. Without a fixed address, you are a
consumer of internet resources, not a provider; on the other hand, it opens
up a lot more utility to the connection -- people can find you!
Finally, there's the matter of the amount of stuff you can have behind the
connection. If the link is on a host basis, (one host only), you can't
very well extend its reach to the whole workgroup or corporation. You
might charge a little more if the connect is a link to the whole LAN,
since that's arguably worth more. Brave souls would want to gateway
entire ad-hoc metropolian networks behind this very slow line, and you'd
have to charge for the headache and administrative load that would bring.
I will note that the Merit computer network (in Michigan) currently has
a setup where if you dial into one of their terminal servers you can
get an unauthenticated, unbilled, variable address connection to some
part of the internet for no money (using a somewhat obscure protocol variant
of SLIP). I won't give you any more details because it's scheduled to
change in availability on short notice. What I can tell you is that it
has created a substantial body of internet users who are interested in
the net not for mail or news but just for things like anonymous FTP,
finger, libraries, multi-user games, etc., and who are probably willing to
pay very little money with the expectation of very little service.
(I helped get this service rolling -- I used to organize a large ms-dos
software archive on um.cc.umich.edu, and at some point the hopelessness
of the file system got to be too much. By telling people that the only
way to get new stuff was to anonymous FTP it from a different machine,
and mercilessly flogging the sortware necessary to do it, it opened up
a lot of eyes. Didn't hurt that anonymous FTP was free and downloading
with kermit cost computing center rubles, either...)
So to conclude: if the regulatory hassles can be overcome, you should be
able to get roughly the same amount of UUCP or anonymous FTP airtime for
the same amount of money. More permanent connections will cost more.
$200/month, plus some startup costs, is perhaps a little low, though as I
say it's hard to judge without competition.
obdisclaimer: I have a financial stake in an organization which is
considering entry into this market, so I might be telling you a bunch
of lies to get you to go off and lose money. :-)
--
Msen Edward Vielmetti
/|--- moderator, comp.archives
emv@msen.com
"With all of the attention and publicity focused on gigabit networks,
not much notice has been given to small and largely unfunded research
efforts which are studying innovative approaches for dealing with
technical issues within the constraints of economic science."
RFC 1216
