I’ve been asking engineers around for reasons why ISPs around the world have been implementing bandwidth caps and got several possible scenarios to consider. Here are the top 5 most probable reasons behind the issue of bandwidth caps.
Some or all of these reasons might also be true for our local telcos/ISPs as well.
1) Subscription Mis-match. Residential subscribers using their connection beyond “residential use” (like for powering their internet cafe businesses). If you see one of those small mom’s and pop’s internet cafe that’s placed as an extension to a house, it’s highly probable they’ve used their residential line instead of getting a business subscription. (Why? Because a 2Mbps residential subscription is 50% cheaper than a 2Mbps business subscription.)
2) Over-subscription. ISPs take on more subscribers than they can actually handle. That means, if they sell you a 1Mbps connection for Php999, they might be actually allocating just 0.25Mbps to that subscriber so they can sell 3 more accounts to fit the actual 1Mbps allocation.
If ISPs didn’t allow “over-subscription” on their network, they might need to double the monthly service fees of subscribers just to hit the same annual revenue targets they currently get.
3) Abusive Users. Subscribers who are downloading files 24×7. That usage pattern can already be considered a business subscription rather than a residential subscription. The term “abusive” is debatable though. It’s the service provider that determines what “abusive” in the same way they’re the ones who defined what is “residential subscription” and “business subscription”.
NTC puts this figure at 1 – 2% of total broadband users. It might seem a bit small but that percentage is already equivalent to 30,000 to 60,000 subscribers (from an estimated 3 million broadband subscribers in the Philippines). If all of them sustained a 1Mbps download 24×7, that will use up 30-60Gbps of the whole network. Not sure if my figure is accurate but my guess is that total bandwidth available in the Philippines is in the 250Gbps to 300Gbps (half of which goes to big companies such as BPOs).
4) Mis-distribution. ISPs allocate a certain bandwidth to specific areas but oftentimes, the allocation to those areas do not match the cumulative usage of subscribers there. Hence, there will be areas where internet speeds are better than others.
5) Increase Subscriber Capacity. This is actually similar to over-subscription but the short explanation here would be — if the ISPs can just clamp down on the 1 – 2% of those abusive users from hogging the network, they can probably increase their subscriber capacity by an additional 10 – 20% more of their existing user base.
I believe the issue stemmed from a combination of several points raised above — I’d point the finger on over-subscription first then the network hoggers.
The article on bandwidth caps from Wikipedia mentions:
Many broadband Internet Service Providers in North America and Europe introduced bandwidth caps in the early 21st century. The same practice has been in place in Australia, New Zealand, Malaysia and South Africa since the release of broadband. NTT Communications in Japan imposes a 30GB/day upload cap with a warning for a first violation and disconnection for repeat offenders.
Remember that ISPs have already implemented the caps years ago, even before NTC made this draft memorandum. Just go over your Service Order Agreement with your ISP and there will be a section there that covers P2P throughput and month bandwidth caps (here’s a sample contract for Globe Broadband).
I strongly believe in the Free Market Economy — that the service provider that offers the best service will always get the most customers; that healthy competition will allow the market to stabilize and result to cheaper prices and/or better service (I used to pay Php1,995 for a 384Kbps connection; now it’s Php1,995 for 2Mbps — not a huge improvement but an improvement nonetheless) making the customers the ultimate winner.
Subscribers just need to be vigilant and I think what should be removed from the contracts is the lock-in period — that if you’re not satisfied with their service, you can just request for dis-connection anytime and switch providers immediately.
Kudos to Cake for that comment, he already whacked out that 5 reasons, “Greed” is the root of this bandwidth cap.
Sana lang talaga magkaron ng “Data only” lang na competitor ang mga leading Telcos, problema dapat ng provider yan at hindi dapat i-regulate ang subscriber, again Upgrade dapat ng system hindi bandwidth cap ang sagot dito at may mas importante pang issue kesa dito sa naisip ng mga Telcos/ISP.
ung pinsan ko nag speedtest 30mbps internet download speed nya… sabi ko niloloko mo lang ako… pero totoo daw. eh itong pldt dsl namin 3mbps lng eh haha
The first reason is indeed BS. Business connections offer much more than residential connections – they have lower latency rates, static IP, and are prioritized over residential lines for efficiency. That being said, there is no such thing as subscription mismatching.
It is ultimately the lost of a business if it decides to use a residential line. That being said, I don’t agree with the practice either.
huh? These are pure BS. Don’t ever put the trash of our country in other country’s lawn. Other countries still offering 64kbps dial-up connections and are getting actual 64kbps speed. While our 1mbps connection only get a 10th of the advertised speed. Big difference.
This bandwidth cap only proves that we do not need a better infrastructure just to increase the speed. And the fact that they can implement this right away only means that they have been screwing their subscriber from the very start.
hmmm. Big trouble for TELCOS. Bandwidth capping was UNLIKED by thousands of the subscribers. Most of the reasons by the subscribers are vaguely fair. Which means, TELCOS should have an alternative plans for BANDCAPPING, a new challenge for TELCOS. HAPPY NEW YEAR:)
Twitter: Vincent
says:
[quote]SmartBro, Smart’s wireless broadband service – through its wholly-owned subsidiary Smart Broadband, Inc. – continued to expand as its wireless broadband subscriber base grew 71% to
reach 596,000 as at end-March 2009, 183,000 of which were on SmartBro’s prepaid service.
Wireless broadband revenues grew 40% to P1.3 billion, a significant improvement over the P 919 million recorded in the first quarter of 2008. [/quote]
[quote]Retail DSL continued its strong performance as broadband subscribers grew by over 38,000 to 471,000 at the end of March 2009 from 433,000 at the end of 2008. PLDT DSL generated P1.6 billion in revenues in the first quarter of 2009, up 27% from P1.3 billion in the same period in 2008, accounting for about 50% of the PLDT Group’s broadband and internet revenues for the year. [/quote]
http://www.firstpacific.com/admin/upload/media/press/ep090505.pdf
nalulugi ang smart bro and pldt dsl?
2) Over-subscription.
this happened in our area. i am satisfied an availed the retention offer of the company only to experience “color-code” issue on their network. frustratingly, they want to charge me for the service they can no longer provide.
There is no valid reason to penalize every consumer for the abuses of some and the inadequacies of the service provider. I agree with the posts above, in a developing country like the Philippines, capping is the way backward. The clear path is to improve the network capacities to support the demand.
I have been a subscriber with PLDT and I have never experienced the advertised speeds. I really feel bad that some people get to exceed their badwidth while I languish with slow speeds. Now with the badwidth cap, all the more frustrating. BOO for supporting this!
Twitter: marjunegarcia
says:
upgrade muna service nila.. pero siguro.. ok ang cap sa wireless connection.. pero sa wired siguro.. sana walang cap
“That means, if they sell you a 1Mbps connection for Php999, they might be actually allocating just 0.25Mbps to that subscriber so they can sell 3 more accounts to fit the actual 1Mbps allocation.”
sounds cheating right? anu paki ko sa income nila..at the very first place sila ang nagsasabi na 1mbps for 999..if they are actually just givin customer 1/4 of the said speed that is a F$%@$&G cheating!!!
ISPs can solve all these problems if they UPGRADE. Capping bandwidth is not the answer.
In response to the reasons:
1. First, this is absurd. I’m pretty sure the contract for residential connections restrict it’s use commercially.
Second, it doesn’t really matter how a residential subscription is used. 1 computer using the full extent of the line uses the same bandwidth as 100 computers sharing it; you cannot get faster speeds or consume more bandwidth than your plan allows.
2. Spot on. Note that the bottom line for the ISPs is to hit a certain amount of revenue. Overselling does not make them unprofitable, just less profitable than what they could be by taking in as many subscribers as they can regardless of the impact too many subscribers will have on the service as a whole. It’s pure greed.
3. This is an outright fabrication. If you are on an unlimited 1Mbps line, it should not be considered an abuse to maximize it’s use since that is exactly what you paid for.
The concept of “abusive users” is made up to act as the ISP’s scapegoat. The reason the network is strained is because there is just too many subscribers on it. You know there’s something wrong with with the network’s capacity when 2% of it’s subscriber base degrades the whole service.
Instead of making excuses and using these so-called abusive users as an excuse to cap bandwidth, they should upgrade their capacity.
4. This is a reason to cap bandwidth? Seriously? If an area is getting more bandwidth than it’s users can consume, the logical thing to do is to re-appropriate this excess bandwidth to areas that need it, not impose bandwidth caps on everyone.
5. Again, pure greed. They know what their network capacity is. It is obvious from the spotty service that the network is already strained as it is and still they want to add even more subscribers in?
I’ll explain the scenario in a metaphor. It’ll be simplistic and not mathematically accurate but the idea is the same.
ISPs are like eat-all-you-can buffets. For example, they buy 100 crates of food. These 100 crates of food can feed 100 people since the few people who eat more than what they pay for are offset by the vast majority who eat less then what they pay for.
So now, the ISPs have been slowly and steadily letting more people in without buying more crates of food. So they end up making much more money with the same amount of crates of food. Of course, with more people eating, there would be less for everyone so people start complaining.
The ISPs in turn, instead of buying more crates of food to accommodate everyone as what is the proper thing for them to do, they start telling people that some of the customers are abusing their eat-all-you-can buffet so they have to start limiting how much everyone eats. So they effectively advertise as an eat-all-you-can buffet and charge people the premium for that and yet rations the food into servings.
This is essentially what the ISPs want to happen here.
ISP’s must update the prices.. 1 Megabyte per second (1MBps) P999 per month. Not the old one, 1 Megabit per second (1Mbps).So that’s only 125 Kilobytes per second..
Oh, sorry.. What i means is,
New Price: 1024 Kilobytes per second=P999/month
not the
Old Price: 125 Kilobytes per second=P999/month.
#6. so that ISP’s could swallow more unreasonable profit. This is not applicable to us in the Philippines. First, the government nor Philippine laws do not define what is “fair use.” Second, in a misguided democracy like ours, who will regulate the regulators who are the providers themselves? NTC? This is much of a “corporate greed” issue. ISP’s are over-subscribed and yet no one is punished nor the least reprimanded. Is that short of a crime? Oh Poor Juan.
tubong lugaw!!!!!!!!!!!!!!!! greedy telco comp!!!
This the only 5 reason I see that most of us are agree!
1. Money
2. Money
3. Money
4. Money
5. Money
So what the difference Nothing!
[...] Drops, Submersion, Shotgun BlastsThe Best New Blu-ray PlayerThinkGeek Joystick-ItPinoy Blogs5 Reasons ISPs Implement Bandwidth CapsEasy Pasaload with Smart’s Facebook Pasaload AppPhilippines is global number one in voice BPO [...]
http://newsbytes.ph/2011/01/10/telco-group-yes-to-broadband-cap-no-to-minimum-speed/
ganito ka kapal ang mukha nila
Twitter: unwiredtech
says:
You pointed out the best reason why the ISP is capping but I believed it is the responsibility of the ISPs to improve there service and bandwidth capacity.
Anyway, If they cap our bandwidth it would be better to increase the monthly quota. There are subscriber like me that rely more on downloading and uploading of website files for living. For example that 25 gig monthly cap will not suffice my Bandwidth needs.
Right now, Globe Wireless [Postpaid 25 GIG, Prepaid 20-22GIG] BayanDSL[100GIG] and Sun Wireless Broadband[11mb/30min] officially announced the capping. I am not sure with PLDT and SmartBro.
But for sure, they already do the speed capping long long before.
Streaming will greatly affected, personally I subscribe in Revision3 and Miro..:(
What I am hoping right now is that, they will only set monthly QUOTA e.g 60/80GIG/monthly and the Speed will not be capped…
Nag-comment na ako sa ibang thread, pero heto rin in case:
http://www.pinoytechblog.com/archives/ntc-ditched-bandwidth-cap-proposal-whats-next
Ooops, nakalimutang ilagay din:
http://newsinfo.inquirer.net/breakingnews/infotech/view/20110112-314047/NTC-junks-proposed-cap-on-Internet-downloads
It’s a good thing the NTC did not immediately enforced such capping considering the strong lobbying from telecos. Kudos for NTC in allowing public consultation on this matter. What a pain in the a** if this will be approved agad!
Twitter: copypasted
says:
i hope globe prepaid dongles are spared to the caps imposed. i think its not “hogger” to download a pirated movie sizing 801mb. if i regged to the 1 day unli surf – i download the 801mb file – i get capped – 24 hours – then im expired – then ill have to register again just to completely download that file? unfairrrrrr….
postpaid ung limitahan. wag ung prepaid.
[...] But that’s just the NTC and it’s still a draft so ISPs can still continue with their bandwidth capping provisions as stated in their service contracts and [...]