·Verizon Online DSL
reply to tmc8080
On capacity-constrained networks, usage based billing makes sense. Unlike a fiber or DSL network, where capacity upgrades are relatively inexpensive relative to the cost of the initial plant (and the initial plant in the case of DSL has a technical ceiling), HFC and cellular systems have incremental upgrades (more bandwidth, smaller cells/nodes) that can be tacked somewhat easily to expenditures. It's far from perfect, but especially on cellular networks (with relatively limited capacity) the cost of a few super-heavy users may actually end up being a whole new cell site, if you're in an urban area where capacity is actually constrained.
Now you can choose to base your network infrastructure and user pricing on average usage rather than tinkering with pricing to monetize the users who, indirectly, cost you the most money in plant upgrades...Sprint does this with smartphone users...but if the pay-per-byte charge is reasonable (and it isn't on AT&T and VZW right now, but at one-third of current rates it would be) you've got a situation where usage based billing works out.
Again, current UBB rates are too high. $10 per GB on mobile wireless is too high. 20 cents per GB on DSL is too high...DSL probably shouldn't even have caps. 20 cents per GB on cable, billed in $10 increments, doesn't have as much granularity as it should. However if rates were $5 per GB, billed in 100MB increments, for mobile, 50Â¢-$1 per GB billed in gigabyte increments for fixed wireless and 10Â¢-20Â¢ per GB billed in dollar increments for cable, that's reasonable use o UBB. For fiber or DSL providers, you don't need caps as long as you make sure that someone isn't reselling the connection.
Then again, I'm pro-UBB compared to everyone here. Maybe because, if I started a wireless ISP (and there's a good chance that I will), I'd have a $25 plan with enough usage and speed for 40% of people (2 Mbps down, 1 Mbps up, 50GB per month probably, with reasonable overage charges), a $50 plan that was good enough for 80% of folks, and on up until nearly-unlimited (probably 1TB) for around $100, delivering as high a speed as I can do reliably over fixed wireless and charging overages in small enough blocks that, bove the $50 level, you'd be paying for usage like you pay your utility for electricity, rather than like you pay your cell phone copany for overage minutes (though the concept of overage minutes is quickly going away).