At NANOG 27 last week there was talk that long term transit prices are going to rise to $150 per Mb/s as soon as some of the lower end providers are flushed out of the market. The consensus among network operators is that anything below $150 per Mb/s is below cost.

Anybody agree/disagree?

I've also heard that. When talking to an Internap rep I was told that one reason people think their pricing is so high is that when the bottom fell out of bandwidth pricing they did not lower their prices. I was told that when the bandwidth pricing goes back up to where it needs to be for companies to be profitable that Internap's offering will be very competitive.

I believe Internap is the only Tier-1 Bandwidth provider (yes I know they don't own the network, but they sell bandwidth so analysts lump them with att and sprint and the other tier-1 providers for comparison) that made money last year. I was told that because I asked about their stock pricing falling to $1 and getting delisted from Nasdaq, so not only did the salesman talk to me about their network, but he also explained a lot about their financial situation.

As for anything below $150/Mb/s being below cost...I have no idea. As an average, maybe...but some smaller companies who cut corners in lots of places can probably continue to give the same crap service they give now on the same crap network they have for under $150/Mb/s.

I can't see bandwidth pricing increasing at least for current transit customers, rates you get now you should be able to renew at, there has been talk of that for ages, although I think it will stop decreasing and stay very constant for a while until things stablize.

I have had quotes from many tier 1 providers around the $200mbps mark including Internap, a quotes from tier-2 providers < $100mbps including Hurricane Electric and several others.

Originally posted by MattF
I have had quotes from many tier 1 providers around the $200mbps mark including Internap, a quotes from tier-2 providers < $100mbps including Hurricane Electric and several others.

Are the quotes 95% or average bandwidth?

Originally posted by MattF
there has been talk of that for ages, although I think it will stop decreasing and stay very constant for a while until things stablize.

Well a lot of the tier 1 providers are loosing money, so I can see why analyst say that in order for them to stabalize that they have to raise prices. Businesses are in business to make money...that's it. If they can't make money with their current model/pricing they either change it or go out of business.

Maybe pricing will never go up, maybe it will go up tomorrow, I have no clue. If it did go up across the board, though, I would not be surprised at all.

it would'nt surpise me either somone told me the other day had a buddy renewing a contract with verio I believe he had it down around 60mbit or somthing and they made him go up on price I'm not sure as somone I know that does servers was telling me about that.

Several people I know that have recently purchased bandwidth(several hundred Mbit) from the likes of verio and few others have stated they were not able to get the bottom prices that were floating around just a few months ago. I wouldnt be surprised if prices continue to rise, aside from the lowend providers cogent/williams/aleron.

As long as the pricing for the fiber keeps going down, transit costs will stay low...With MFN, XO and others having networks with basically no current cost basis (they went chap 11, and got rid of a ton of debt), the cost to move a packet from A to B will remain low...

-Reid
he.net

i was recomended to ntt/verio because a friend of mine was getting around 50mb/s for about 160 a mb and when i contacted them the lowest they were willing to pay for 100mb/s was 230 a mb


-dennis

Try looking elsewhere. :-) People are selling at lower than that out there. Present company included. :-)

Originally posted by MattF
I can't see bandwidth pricing increasing at least for current transit customers, rates you get now you should be able to renew at, there has been talk of that for ages, although I think it will stop decreasing and stay very constant for a while until things stablize.

I have had quotes from many tier 1 providers around the $200mbps mark including Internap, a quotes from tier-2 providers < $100mbps including Hurricane Electric and several others.

However,

Hurricane Electric Resellers get a big price discount for services that they sell, which, in turn get passed along to the customer. So, it's very common to go to an HE reseller and get a sub $100 price.

-- Jonathan

Originally posted by Dmax
i was recomended to ntt/verio because a friend of mine was getting around 50mb/s for about 160 a mb and when i contacted them the lowest they were willing to pay for 100mb/s was 230 a mb


-dennis

Yup thats what I am hearing about a few companies, they made the quick buck to compete with cogent now they need to not go out of business so they raising their prices. If more consolidation happends in the industry(ie level3 buying genuity) prices could continue to rise.......then again I am not a fortune teller just guesses :)