Data consumption - a case for usage-based billing

Oct. 6, 2018
OpenVault's Q3 review of upstream data usage indicates that average consumption per household was 13 GB per month, while commercial subscribers averaged 30 GB of upstream usage in September 2018 alone ...

OpenVault's Q3 review of upstream data usage indicates that average consumption per household was 13 GB per month, while commercial subscribers averaged 30 GB of upstream usage in September 2018 alone.

Upstream use is 18% of total usage for commercial subscribers while it is only 5.5% of total usage for residents. Overall upstream usage per subscriber is growing at approximately 16% annually. In the reverse, average downstream commercial usage per subscriber is 35-50% lower than average downstream residential usage.

OpenVault also saw a difference in numbers in situations where usage-based billing plans (UBB) is used vs. where it is not. For example, the upstream usage per subscriber for providers with UBB in place is 15% less than that for providers without UBB in place.

About half of OpenVault's customers have moved to UBB, with "most" setting quotas that affect only about 1% of subscribers.

"We don't have a single operator that has employed it that has regretted it. They only regret waiting as long as they did to deploy it," said Mark Trudeau, CEO, OpenVault. "It is not intended to impact the majority of customers, but the top-of-the-top subscribers."

What this may mean is that over time as "power users" start to get billed for excessive usage, they will curtail it themselves. Knowing this is important for operators who are considering UBB, Trudeau said. "We have a history of tracking and are prepared to share that type of information. It has become clear that average usage is coming in pretty significantly less than those (operators) that don't have (UBB)."

As customers are cutting the cord and subscribing to multiple OTT services, operators are focused on rightsizing customers for their bandwidth needs. "What we are seeing and guiding operators toward is establishing higher quotas for bandwidth tiers," Trudeau said.

Along with this comes the importance of network visibility, so operators know where there might be congestion. Different parts of the network are not the same, with variables ranging from speeds and usage to adoption of various bandwidth packages.

"Identifying and figuring out how to manage congestion is key to keeping up with growing demand. A granular level of visibility into the network is critical for network planning," Trudeau added.

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