[orik]

Disclosure: I work at a small ISP. We mostly compete with Frontier DSL and Comcast Business Class.

If you're buying residential it's safe to assume you're purchasing a burst-able speed and downloads/uploads aren't going to sustain that for hours on end.

Much in the same way that a Utility Company probably isn't gathering enough water for everyone to be maxing their pipes 24/7, residential ISP's don't operate under the assumption that every consumer will have maxed their connection at the same time, and they shouldn't have too. Smart traffic shaping and peering arrangements gives ISP's room to compete.

If consumers could afford a dedicated 35x15 connection they'd have a T1. When you're buying copper it's safe to assume it's going to be over saturated.

The real problem is ISP's for the most part don't compete. They zone of sections for eachother and rack in as much dough as they can. Consumers aren't informed about the quality of different types of connections vs others, and buy based off the cheapest Mbps down/up they can get.

[twic]

in the same way that a Utility Company probably isn't gathering enough water for everyone to be maxing their pipes 24/7, residential ISP's don't operate under the assumption that every consumer will have maxed their connection at the same time

That's not what's happening, though. What's happening is that the ISPs have not provisioned enough capacity to serve the actual aggregate demand at peak times. The hydraulic analogy would be if water pressure dropped every day between 0800 and 0900 because everyone was having their morning shower. That would not be acceptable to customers, and nor is the situation with ISPs.

[cs702]

Exactly. Great analogy!

What's more, the utility company is getting water through a pipe that goes to a middleman near a river, but that pipe doesn't have enough capacity to deliver the water necessary for all utility customers to take their morning shower at the same time. So what does the utility company do? It blames the middleman and the river for "sending too much water"... and demands payment from them!!!

[karavelov]

As I see the graph in the post it looks like the customers have full pressure only between 3 and 4AM. In the rest part of the day they are struggling to get their shower.

[eggnet]

The congestion in the news is at the interconnection between networks, not the last mile. This is why Netflix's deal with Comcast resulted in immediate relief without a massive rollout to upgrade last mile infrastructure.

Cable providers have a large amount of capacity provisioned to their customers and are paid a fortune by their subscribers and municipalities, using the same network for data and cable services. They just want you to use their services as opposed to a competitor. Not only that they have turned the tables forcing content providers to pay them to deliver bits.

With respect the economics of a small ISP reselling transit aren't comparable to this situation.

[wmf]

Realistically, we're talking about customers who are paying for 10+ Mbps and were getting less than 2 Mbps.

[mfisher87]

... and almost all the time.