Why is bandwidth expensive

As more and more users come online, large companies are subsidizing free internet. Like Reliance Jio in India who made the internet free for several months on its arrival. For these large tech companies to make a profit, they need a large part of the population to be online. The cost of bandwidth is going to decrease over time. Currently, it is expensive if you compare them to different places. The data pipe capacity will continue to grow as the data volume continues to grow.

Even with fiber optic cables and new 5G technology. Sending billions of bytes from one point to the other is expensive. That is why you will pay for the service. Bandwidth prices are different from country to country. If a country hosts content on servers that are within the country then the cost decreases. If the content is on servers that are outside your country then that is going to raise the price of the bandwidth.

Other problems that add to the bandwidth costs include cable-landing stations. These points are where submarine cables are entering and exiting the mainland. Owners of these stations can charge a high amount of the ISP traffic that is passing through them. Calculating bandwidth cost will differ for each service provider. Every provider will offer different prices. The two main factors that affect bandwidth cost are:.

The formula to calculate the cost of bandwidth is reference bandwidth divided by interface bandwidth. It's a hard problem and I've been thinking about it for a while. In college I researched "TorCoin" for my senior thesis which explored the possibilities of a proof-of-bandwidth cryptocurrency. I know some ICO's are working on this now but I'm really skeptical the idea can work without a killer product in the hands of users driving adoption. That's the product I want to work on.

I'm still figuring out exactly what it is, but I've been thinking about this kind of thing heavily for the past 5 years and feel pretty confident I can execute if given the right time, team and funding.

Really interesting. Thanks for the info! IP transit is pretty cheap and is expected to continue to fall in the future. So all the data you can transfer at a 1Gbps pipe. I've heard of the higher rates in the US, but I didn't expect the difference to be that much.

That seems really cheap. Thanks man! An cable long enough to cross the Atlantic cost a lot. The more bandwidth you need the cheaper it gets per Mbit. For a startup I suggest going peer-to-peer like the bittorrent protocol to distribute your content.

Note that you can still charge for it. That's what Spotify did in the startup. With peer-to-peer it uses the user's bandwidth to distribute the content, so that you do not have to pay for the bandwidth. Peer to peer is an interesting thought. I'm curious how that would work with video hosting. Will have to read into it. Please learn the difference between bandwidth and data transfer.

Bandwidth is a speed, data transfer is an amount of transferred data. Bandwidth is like the diameter of the water pipe coming into your house. I appreciate and understand the difference but like you said, most hosting companies use the term bandwidth to describe their data rates. So it makes more sense to discuss it using their nomenclature. Also, if you want people to listen to you, try being a little less condescending.

You can be informative while not sounding like everyone else is dumber than you. Your approach to "educating" makes anyone who didn't know what you are trying to explain feel incompetent. I'm not sure what the benefit of that is for you, but you might want to reassess your approach. The tech industry is difficult enough to navigate. Why not try and be a little more welcoming? So how do you have a technical discussion about the cost of your IP connectivity, when you're using the same term for the speed and the amount of data?

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