If you read below the price tables you'll get a good hint:
> What happens if I exceed my monthly transfer quota?
> You will be invoiced $0.10 for each GB over your pooled network transfer quota. Please note that all inbound traffic is free and will not count against your quota.
Bandwidth is the maximum Mbps that your VPS can spill out at any moment, whereas transfer is the maximum amount of per-month cumulative traffic that you can send out before incurring on additional traffic costs.
It's pretty straightforward - find a high-water mark for customers in terms of their inbound data, that 99.9% fall under, say, for linode, 99.9% of their customers pull in less than 16 megabits/second sustained, which is 7.2 Gigabytes/Hour, 5 Terabytes/Month.
And then explain to your customers that 99.9% of them use less than 5 Terabytes/Month bandwidth, and that effective now, the first 5 Terabytes/month of bandwidth is included in the cost of their VPS, and for those 0.1% of customer who exceed that 5 Terabytes, they'll get a very reasonable rate of $0.01/gigabyte ($10/Terabyte) for inbound data in excess of the 5 Terabyte initial allocation.
Realize that linode is probably paying less than $4/megabit @ 95th percentile - but the vast majority of that is likely downloaded, so they have an asymmetric allocation that they are trying to utilize with this "unlimited inbound" offer.
I just want the HN audience, in particular, to realize that the statement ""This means you can upload an unlimited amount of data to your Linode without having to pay for any of the incoming data transfer."" should not be taken at face value if you are putting together a business plan.
In general - bandwidth is priced @95th percentile on the internet, and any time you run into the phrase "unlimited" you should take it with a grain of salt and get something in writing before you rely on it.
Paying for transfer isn't the same as paying for bandwidth. If I download something in the middle of the night vs at peak usage, it's the same transfer billing, but one utilizes bandwidth that isn't scarce and one does.
I was wondering about bandwidth limit of their VPS, and found this in their pricing page:
> We don’t charge for bandwidth. You’ll save a ton of money with our network and it's easy to get started. No need to figure out how much bandwidth you’re going to use, whether that traffic is in or out. Set your site up and pay no extra if it takes off.
Whenever I see statement like this I'm not sure whether I should trust it; what if I use 1 TB/month, would I get kicked out for "using too much bandwidth"? What's your real soft cap?
This should include some data transfer and associated costs. Some of the services the services listed include a certain amount of bandwidth in the listed price, while others don't.
I have a VPS on buyvm which includes 2TB/month for $6. Each extra TB is another $2.50. This is not a special case, you can other providers with very good pricing for data transfer. I don't understand how the difference in bandwidth pricing can be so large. I'm also certain that Amazon doesn't pay as much for bandwidth as the guy from buyvm.
I believe that bandwidth charge is after you've exceeded the monthly allowance and for when someone wants to pull your image over the internet, and not distributing to your instances.
"In the future, each plan will have a bandwidth allowance and additional outbound data transfer (from the registry to the internet) will be $0.10/GiB."
There actually isn't. In hindsight, I probably should've mentioned that in my article; that is a major thing that I found missing. However, according to a few forum posts anyway, they're not actually billing for excess bandwidth at the moment.
Network and bandwidth are absolutely not free but certainly not that expensive as the three major public clouds are charging: $0.1 per GB equals to $100 per 1TB transfer.
Linode, Digital Ocean and other hosting companies sell small VPSs with 4TB bandwidth for $10/month and still making profit. At places like OVH, Hetzner bandwith is virtually unlimited.
You can sell transfer. It's the content provider that pays for the bandwidth, so it doesn't matter if it's free for the end user, as long as you can keep the marginal cost low enough for scale.
The bandwidth pricing is extremely expensive -- for comparison, I pay $60/mo for a VM with 1500GB/mo transfer, yet they'd ask $250/mo just for bandwidth charges for 1000GB/mo.
Someone please clarify my doubts. When I run a server, I have to pay for bandwidth costs. For eg. My website hosted on linode gets me 20TB of data transfer limit. I expect end users to be able to view content worth 20 tb of up/down data transfer. Netflix runs its own servers but the ISP providing connectivity must be already charging Netflix for a certain bandwidth and data transfer limit. If the ISP is charging for data transfer already, I expect the ISP to provide the entire service. For eg. Let us assume that Verizon charges netflix 1 usd per tb of data transfer. And Netflix uses 20000tb of data in a month. Then Netflix owes Verizon 20000 usd a month. And Verizon has to serve the data according to the bandwidth agreed to.
Is Netflix not paying Verizon for the bandwidth and data transfer?
If Netflix is not paying Verizon then why does my hosting provider charge me for bandwidth and data transfer?
So if I understand that correctly, the reason other providers seem to provide a lot more bandwidth per subscriber dollar (ex. my Linode has 200G transfer/month at $19.95) is most of their customers probably don't push the pipe into an overage so they're basically overselling the bandwidth?
p.s. I just noticed your $20 plan provides double the RAM and 4gb more disk than my Linode... i'll do a little more research but I might just switch since I don't get anywhere near that bandwidth cap.
> You will pay through the nose (compared to US prices) if you have high bandwidth traffic
What do you mean? It comes with 5TB of network traffic, and they don't charge for additional traffic, merely limit your speed:
>> The server is connected at 100Mbps. The bandwidth is 100Mbps guaranteed up to 5TB of monthly traffic. Beyond 5TB of monthly traffic, the bandwidth is 10Mbps guaranteed.
"There's no bandwidth cost associated with transferring data TO Tarsnap"
Except for those of us who's outbound bandwidth isn't free and/or unlimited. It makes no difference what Amazon charges Tarsnap for it - I can't upload all of my 128G SSD every hour - I just don't have the bandwidth to do it, and if I _did_ have the bandwidth, it'd probably send me broke pretty quickly (or have my ISP throttle me or cut me off).
It's not a Tarsnap cost, but it can be a Tarsnap user cost, and I suspect cperciva considers that just as much a "real cost" as actual monetary expenses to Tarsnap.
> What happens if I exceed my monthly transfer quota?
> You will be invoiced $0.10 for each GB over your pooled network transfer quota. Please note that all inbound traffic is free and will not count against your quota.
Bandwidth is the maximum Mbps that your VPS can spill out at any moment, whereas transfer is the maximum amount of per-month cumulative traffic that you can send out before incurring on additional traffic costs.
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