We went through this usage based billing (UBB, aka capacity based billing (CBB)) thing here in Canada a couple of years back, where the incumbent carriers (DSL

We went through this usage based billing (UBB, aka capacity based billing (CBB)) thing here in Canada a couple of years back, where the incumbent carriers (DSL and cable) somewhat successfully lobbied the CRTC to set wholesale tariffs based on a mix of generally lower access fees (paid per subscriber, specifying a certain connection speed but no actual traffic), and interconnect fees (covering a certain interconnect speed between the incumbent's network and the third party ISP's backhaul). The net effect of the model is that a third party ISP's variable costs are essentially the cost of their interconnect with the incumbent, and are dominated by their burst needs during peak usage times. As a consequence, there are a number of business models which this lends itself to (in terms of incentivizing users to shift usage to off-peak times) in addition to straight download cap vs. unlimited offerings. For example, some ISPs (like Teksavvy, for example) offer unlimited plans with a reduction in speed during peak hours. There was a LOT of debate on the subject on places like dslreports when this was in front of the CRTC. The general consensus seemed to be that UBB in principle is a good thing (it allows for more flexibility in third party ISP business models, and roughly aligns costs with income for the incumbent) although the particular tariff prices put forth by the incumbents were inflated and suspect. As a real-world benchmark, my third party provider (start.ca) offers a 30/5 cable plan with 200GB of usage for $45 CAD (roughly $40 USD) per month. Going to an unlimited plan adds an extra $15 CAD to that, with the risk for overages being borne by the ISP. Of course, the incumbents' retail offerings are universally terrible (their caps are laughably small, and their prices higher than any third party provider). Because of the lack of separation between their retail and wholesale operations, they're able to offer (presumably loss leader) promotions that third party providers simply can't, and have the benefit of being able to structure their tariff offerings to screw third party providers wherever possible. So that part of the regulatory environment sucks. Overall though it feels like a decent model (although the actual tariff prices are quite out of line, particularly for interconnect fees). $60 CAD a month for unlimited 30/5 is a fair price in my mind, and if my needs ever change there are enough third party provider with enough diverse business models that I'd likely find something that works for me.