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Of course the missing item in that calculation is the last mile. Netflix could set up a cage at each landing point and the savings would be nearly 99%. And that

Of course the missing item in that calculation is the last mile. Netflix could set up a cage at each landing point and the savings would be nearly 99%. And that adequately explains why international transit is rarely the biggest cost issue (obviously there are corner cases around the world where this is indeed the biggest issue). The biggest part of the cost in the infrastructure (systems, staff, maintenance) is from PoP to customer. Having said that some ISPs (especially ones that own the infrastructure) have a habit of increasing prices (if they can from limited competition; i.e. roll out costs are high so not too many companies roll out to a region) and/or leaving customers to rot on old infrastructure (in order to maximise return on sunk cost; makes the CFO happy). EDIT: clarification.

kuschku 11y ago
It’s incredibly annoying when a big multinational ISP asks you to pay 120$/month for a connection with throttling, data caps, and blocked services of competitors, while a small, local business manages to provide the same for 30$.
- dragontamer 11y ago
  Why is that annoying? Most people in the US don't even have the "small, local business competitor". If anything, congratulations on living in one of the few areas in the US that actually has broadband competition.
Dylan16807 11y ago
The last mile is the vast majority of the cost, but it's not what ISPs talk about when they try to justify price increases and refusals to peer. They talk about the usage, even as that gets cheaper and cheaper. If we shut that rhetoric down, and get them to be honest, we're a lot closer to reasonable policies. Or we go with the simple answer and split last mile and transit into different services, but that requires government intervention.
- tw04 11y ago
  The only way to prop up their profit margins, in their eyes, is to talk usage. They could very easily provide everyone gigabit service, but then there would be no up-charge for the next 5-10 years as all the services catch up. If they switch to usage based billing, they can literally print money. They won't need to upgrade infrastructure for the foreseeable future because the stifling caps will keep people from fully utilizing what they pay for. Forcing video services/games/music/etc. to not create new services that require more bandwidth. It's an awesome snowball effect for Comcast, and a giant middle finger to the users.
  - Aleman360 11y ago
    We have metered electricity, water, sewage, etc. Why shouldn't we pay per byte?
    - tw04 11y ago
      If you're going to support regulating the shit out of internet and capping their profit margins, sure. We'll all be paying about $40/month for gigabit internet, I'm all about it. Of course, that's not what we're talking about. We're talking about private companies making up their own caps and their own cost structures so that they can push to the 30%+ profit margins seen in the wireless industry.
    - Dylan16807 11y ago
      It's not the worst idea, as long as the price is connected to the cost. The reason not to is that the production plays a huge factor in those things, and people use similar amounts so folding infrastructure into cost doesn't distort prices very much. With bytes, neither of those are true and pricing gets weird and often bad.
    - simoncion 11y ago
      ...because the marginal cost of each byte is effectively zero? ...because the cost of running the network doesn't significantly change whether it's idle, or at full capacity? ...because -unlike electricity, water, and sewage- we have an infinite supply of bytes?
nickjj 11y ago
Netflix does offer something like that already: https://openconnect.netflix.com/ https://openconnect.netflix.com/ It's up to ISPs to opt into it. My ISP happens to and the streaming quality is quite good. However my costs do not decrease.

kuschku 11y ago

It’s incredibly annoying when a big multinational ISP asks you to pay 120$/month for a connection with throttling, data caps, and blocked services of competitors, while a small, local business manages to provide the same for 30$.

dragontamer 11y ago
Why is that annoying? Most people in the US don't even have the "small, local business competitor". If anything, congratulations on living in one of the few areas in the US that actually has broadband competition.

Dylan16807 11y ago

The last mile is the vast majority of the cost, but it's not what ISPs talk about when they try to justify price increases and refusals to peer. They talk about the usage, even as that gets cheaper and cheaper. If we shut that rhetoric down, and get them to be honest, we're a lot closer to reasonable policies. Or we go with the simple answer and split last mile and transit into different services, but that requires government intervention.

tw04 11y ago
The only way to prop up their profit margins, in their eyes, is to talk usage. They could very easily provide everyone gigabit service, but then there would be no up-charge for the next 5-10 years as all the services catch up. If they switch to usage based billing, they can literally print money. They won't need to upgrade infrastructure for the foreseeable future because the stifling caps will keep people from fully utilizing what they pay for. Forcing video services/games/music/etc. to not create new services that require more bandwidth. It's an awesome snowball effect for Comcast, and a giant middle finger to the users.
- Aleman360 11y ago
  We have metered electricity, water, sewage, etc. Why shouldn't we pay per byte?
  - tw04 11y ago
    If you're going to support regulating the shit out of internet and capping their profit margins, sure. We'll all be paying about $40/month for gigabit internet, I'm all about it. Of course, that's not what we're talking about. We're talking about private companies making up their own caps and their own cost structures so that they can push to the 30%+ profit margins seen in the wireless industry.
  - Dylan16807 11y ago
    It's not the worst idea, as long as the price is connected to the cost. The reason not to is that the production plays a huge factor in those things, and people use similar amounts so folding infrastructure into cost doesn't distort prices very much. With bytes, neither of those are true and pricing gets weird and often bad.
  - simoncion 11y ago
    ...because the marginal cost of each byte is effectively zero? ...because the cost of running the network doesn't significantly change whether it's idle, or at full capacity? ...because -unlike electricity, water, and sewage- we have an infinite supply of bytes?

nickjj 11y ago

Netflix does offer something like that already: https://openconnect.netflix.com/ https://openconnect.netflix.com/ It's up to ISPs to opt into it. My ISP happens to and the streaming quality is quite good. However my costs do not decrease.