PlusNet highlight ISP costs

PlusNet highlight ISP costs

While discussing something broadband related (strange how I keep talking about broadband with people), I was pointed in the direction of the PlusNet blog, which I hadn’t come across before.

This particular entry discussed the costs incurred by ISPs, depending on their choice of wholesale product, peering arrangements with other providers, costs incurred using transit providers and other factors.

I found this whole blog particularly fascinating, as it is not usual to find an ISP that is this open about their business (a number of their other entries are well worth a read, particularly this one on the impact of the iPlayer on their streaming traffic).

What the entry does highlight very well is the unsustainable nature of all-you-can-eat broadband price plans. Increasing traffic is increasing costs, and ISPs will need to raise revenues to cover these. It is likely that this will push ISPs towards bitcaps, and this could become an area of competition.

However broadband pricing develops, what is important is that the price of a service, and what that service provides, is clear and transparent for consumers. The Ofcom Consumer Panel and Ofcom are already looking at current marketing of broadband speeds. If competition moves away from speed to factors like bitcaps, it will still be important for consumers that the industry continues to work towards greater clarity, accuracy and transparency in its marketing.

Peter Shearman, Policy Manager, BSG

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Comment (1)

  • harrystyris

    Then there is the question about the allowances. If this package is similar to the old PAYG then why are you able to offer 15GB for the same price on that package and only 10GB on this new one even when the wholesale costs have come down since you first offered those allowances?It doesn’t add up, but it is good marketing.

    February 4, 2010 at 7:36 am

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