Broadband Pricing Proportional To Speed Delivered

I'm considering moving home soon and checked broadband avaialability via BT. The available broadband for that area is 4 times slower for the same service. This prompted me to think, "is this a good deal" and "surely, slower should be cheaper" - This is the real world and no it is not.

But should it be..................

It would be your choice to move there, same way you might consider a property based on local schools, and the like.

If a provider can sell an up to 16 Mbps for £6.50 a month how much would you pay for
4 Meg, 8Meg, 12Meg etc

As the market stands the effort in terms of marketing is on getting us to pay more for the faster (FTTC) services now.

Most charging is based around the amount of usage since 2004

I don't know why I'm replying to what is probably a troll post, but....

Lets say the standard service is up to 24mb for £24. You decide you want to live in the countryside and be surrounded by sheep, only get 2mb, pay £2.

My great grandma lives in town, coincidentally right next to the exchange. She only uses email, but gets 24mb so has to pay £24, even though 2mb would be plenty for her.

How is that fair? You could be a heavy downloader keeping that 2mb maxxed the whole month.

Further, most of the ISPs costs are fixed per subscriber. The cost of billing, the cost of invoicing, the cost of support, a port on the DSLAM, SMPF rental from BT, the cost of the free router they give you, etc. How fast you get, makes no difference to their costs.

How much you use is the one variable cost, and someone having 4x the speed does not use 4x as much.

In your world, ISPs would just refuse to service the people who could only get slow speeds, as they would lose money on them.

Edited by nemeth782 (Sat 16-Mar-13 10:24:12)

I think there is a case for somebody paying less for slower speeds if they are disadvantaged with, for example, video streaming: on a medium length line streaming HD 720/1080p should be possible but on a long line SD 360p may not even be playable in real time.

So what happens when, due to incorrect set up/poor house wiring, the punter gets way less than the speed the ISP believes can be achieved ? Who pays what to whom ?

In reply to a post by Zarjaz:

So what happens when, due to incorrect set up/poor house wiring, the punter gets way less than the speed the ISP believes can be achieved ? Who pays what to whom ?

Well don't ISP's generally advise folks to use the test socket and isolate, where possible, house wiring if they have concerns about downstream sync speed? If, as sometimes happens, the supplied router, ethernet lead, adsl lead, micro filters and setup instructions don't provide a sync speed based on estimated attenuation then the costs fall on the ISP for investigation and line repair.

Of course there are exceptions to this DIY principle for punters where a NTE5 is not fitted, there has been a cowboy house wiring installation or the computer is not allowing full potential throughput, but surely sync speeds should be about right and if not it is the responsibility of the ISP to put it right?

There are two major cost types in providing ADSL broadband..

Last mile charges which are the same regardless of speed

Provision of backhaul. The cost of that is more closely related to the quantity of data delivered than the speed of delivery.

Within reason it costs no less to deliver 2Mbps that it does to deliver 20Mbps.

In fact as the slower speeds are generally caused by longer lines and with long lines there is probably going to be more support cost - not least from answering complaints about the speed.

In reply to a post by MrSaffron:

Most charging is based around the amount of usage since 2004

I've been wondering how providers like BT and PlusNet supply unlimited usage for a fixed fee? Is there a 'real' cost of providing every GB of data or is it just marketing?

Is it likely does anyone think that the price of FTTC will come down to a price point equivalent to what we pay for ADSL or should we just get used to paying more for a data connection?