Hi Triple,
I hope I can help.
Pay per Mbit is typically a good idea if you need more than 320 Gigabytes of transfer a month. Some providers will offer discounts if you order bandwidth at a base 1 Mbit.
Here is an example. Say 1 Mbit of bandwidth costs $295 a mbit, that bandwidth translates into $0.91 a Gigabyte of transfer / month. Most providers will ask you to commit to a "base" of 1 Mibt which means you will have to pay the $295 a month even though you may not use all of the bandwidth in that month.
When you purchase bandwidth by the Gigabyte a month, it's an bandwidth accounting method allow you to purchase bandwidth is smaller cheaper bandwidth increments. Some providers start as low as 30 Gigabytes of transfer a month (10% of 1 Mbit). It keeps your initial costs low. However, when you start pushing more bandwidth, it might make sense to convert to per Mbit pricing.
Here is an example. Say you sign up for 50 Gigabytes of transfer a month at $1.85 per Gigabyte / month. that's only $92.50 a month. A far cry from $295. But say you go over your 50 Gigabyte allotment for the month by 150 Gigabytes and use a total of 200 Gigabytes for the month and have to pay an overage of $1.85 a gigabyte... it will cost you $370.. it would have been cheaper to buy the per Mbit option at $295.
I'll copy and paste an article from Sean Adams for the 95% question... -
What is the 95th percentile, and why is it useful in measuring bandwidth?
The 95th percentile is the smallest number that is greater that 95% of the numbers in a given set. The reason this statistic is so useful in measuring data throughput is that is gives a very accurate picture of the cost of the bandwidth. Here's an example. suppose you are hosting a very busy web site that half-way fills your 1Mbit of bandwidth for several hours every day. This type of bandwidth is more expensive, because your ISP can't oversell their connection to the backbone as effectively. The important thing to realize is that it doesn't cost your ISP anything to sell you a pipe of any particular size - it is the sustained rate of data transfer that costs them money. The sum of the 95th percentile usage of all of an ISP's customers predicts the peak amount of backbone traffic that the ISP will incur (in a given direction).
Charging at the 95 percentile makes sense - it's a fair system where everybody pays for what they get. The advantage to the customer is that they get the performance of a high-speed connection, while paying only for their actual usage. ISPs like it because they don't have to worry about high-usage customers upsetting their overselling ratios.
-- Sean Adams
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