Abstract
There is an increasing belief that the transportation of data or Internet
traffic is 'free' or at least extremely cheap. However, this is a false
perception. This report discusses the actual costs involved.
Bandwidth does cost money, and in some cases quite a lot of money. How much it
costs depends on a number of factors, not least, what type of service provider
the end user is connected to. The most basic of these is the pure retailer.
This type of service provider may own very little network technology or
infrastructure, but provides more retail functions such as customer service
and marketing. The pure retailer will therefore pay a wholesale company to
provide its entire network needs. At the other end of the scale is the network
operator or the 'full local loop unbundler'. Both of these types of player
will certainly own their own network technology, and could own and operate
100% of the network infrastructure, although in some cases the service
provider may choose to partner or lease bandwidth from a third-party network
wholesaler - a utility company for example. Between these two extremes there
are usually a number of alternatives, including shared-unbundling and a number
of different types of bitstream interconnect.
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