In a recent article titled "The White Lies ISPs Tell about Broadband
Speeds," we discussed some of the
methods ISPs use when overselling their bandwidth
in order to put on their best face for their customers.
To recap a bit, oversold bandwidth is a condition that
occurs when an ISP promises more bandwidth to its
users than it can actually deliver. Since the act
of "overselling" is a relative term, with some ISPs
pushing the limit to greater extremes than others, we
thought it a good idea to do a quick follow-up and
define some parameters for measuring the oversold
condition. For this purpose we use the term
contention ratio.
A contention ratio is simply the size of an Internet trunk
divided by the number of users. We normally think of
Internet trunks in units of megabits. For example, 10
users sharing a one megabit trunk would have a 10-to-
1 contention ratio. If sharing the bandwidth on the
trunk equally and simultaneously, each user could
sustain a constant feed of 100kbs, which is exactly
1/10 of the overall bandwidth.
So what is an acceptable contention ratio?
From a business standpoint, it is whatever a
customer will put up with and pay for without canceling
their service. This definition may seem ethically
suspect, but whether in the bygone days of
telecommunications phone service or contemporary
Internet bandwidth business, there are long-standing
precedents for overselling. What do you think a circuit
busy signal is caused by? Or a dropped cell phone
call? It's best to leave the moral debate to a university
assignment or a Sunday sermon.
So, without pulling any punches, what exactly will a
customer tolerate before pulling the plug?
Here are some basic observations:
- Rural customers in the US and Canada:
Contention ratios of 50 to 1 are common
- International customers in remote areas of the
world: Contention ratios of 80 to 1 are common
- Internet providers in urban areas: Contention
ratios of 20 to 1 are to be expected
The numbers above are a good, rough starting point,
but things are not as simple as they look. There is a
statistical twist as bandwidth amounts get higher.
Contention ratios can actually increase as the overall
Internet trunk size gets larger. For example, if 50
people can share one megabit without mutiny, it
should follow that 100 people can share two megabits
without mutiny as the ratio has not changed. It is still
50 to 1.
However, from observations of hundreds of ISPs, we
can easily conclude that perhaps 110 people can
share two megabits with the same tolerance as 50
people sharing one megabit. What this means is that
the larger the ISP, the more bandwidth at a fixed cost
per megabit, and thus the larger the contention ratios
you can get away with.
Is this really true? And if so, what are its implications
for your business?
This is simply an empirical observation, backed up by
talking to literally thousands of ISPs over the course of
four years and noticing how their oversubscription
ratios increase with the size of their trunk.
A conservative estimate is that, starting with the
baseline ratio listed above, you can safely add 10
percent more subscribers above and beyond the
original contention ratio for each megabit of trunk they
share.
Thus, to provide an illustration, 50 people sharing one
megabit can safely be increased to 110 people
sharing two megabits, and at four megabits you can
easily handle 280 customers. With this
understanding, getting more from your bandwidth
becomes that much easier.
