Oversubscription is good for power users!
1. It allows ISPs to take bandwidth at a $40/Mbps bulk/wholesale rate and parcel it to consumers for $40/6 Mbps (roughly $7/Mbps). If broadband consumers wanted to buy committed bandwidth in the 5-10 Mbps range, they could expect to pay in the range of $70/Mbps (not much bulk). Looks like a 10:1 oversubscription ratio is very fair in comparison to any traditional business model of a supplier buying bulk and marking up.
2. Oversubscription allows Joe Average User to help finance Joe Power User's connection (a fact that /.ers shouldn't be griping about!) You advocates of pay-per-packet would soon find that your BitTorrent usage would drive your monthly bill to double what it used to be, while granny up the street gets a cost break.
3. No data to back this, but consumers seem to prefer unlimited over metered services. Consider the increasing popularity of "unlimited long distance" plans, mega-rollover minutes (wireless marketing spin for flat-rate). Consider the failure of metered consumer services like ISDN! Sheesh, I wish I could get my energy and water bills flat-rated! My guess is that consumers like the freedom of using a communication service as much as they want, and the predictability of knowing what the bill will be each month.
(Despite what the parent says about paying fixed rates, all tier 1 ISPs offer burst-billed services as well, but ISPs tend to like the same thing as their consumers: predictability of cost...makes the budget easier to figure.)
4. The original justification for packet-switched networks vs. circuit-switched networks was to reduce costs and allow scalability. In short, to more efficiently use available network resources. A dedicated conduit to each subscriber is simply inefficient when you want to scale. This same principle is what makes the economics of VoIP disruptive in comparison to traditional telecom.
5. I hope anyone pushing for a committed bandwidth consumer broadband products isn't simultaneously throwing their weight behind Net Neutrality, because it would essentially make it illegal for telcos and cablecos to provide such a service.
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Re: honesty in marketing, consumer broadband should be marketed as "up to" a given speed. And that's the way the fine print likely reads. But is this any worse than equipment manufacturers that sold you a 56k modems that will never reach 56k? HDD manufacturers that sold you a 1 GB HDD that was 1000 MB instead of 1024? How about the "up to 20 hour battery life" Sony promised you? Those products will NEVER reach their advertised capacities, and at least your broadband may burst to it's maximum on occasion.
And finally, if anyone thinks the economics of running an ISP are so great and broadband providers are all making off like bandits, think again. It's a business of tight margins and heavy price pressure (enough to sink 100s if not 1000s of small ISPs).
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