How to Calculate Bandwidth Usage?
If you ever host a website, you would have thought of this sometime, somewhere along the route. If you are a web-hosting reseller, you will definitely think of this more than you will ever want to remember. So how exactly do we calculate bandwidth usage?
There are two common approaches to calculating bandwidth costs:
In a normal situation, bandwidth is typically measured per GB (gigabytes) of data transferred. However, large web-hosting companies who have their own servers and colocate them in a data-centre will usually calculate by per Mbps (megabits per second) sustained - the method in which colocation data-centres bill you. Web data, by nature, is a bursty medium. Figuring in GB of data transferred makes it much harder to account for bursts. The Mbps method makes it easier to charge for bursts.
Calculating the Gigabytes
First things’ first. Find out the total GB of data a single T1 connection can transfer, assuming that there’s no overhead or packet loss. (If you have stats for your packet loss or overhead, just subtract the overhead from the amount of data that can be transferred and continue with the equation.)
A T1 transmits data at 1.536 Mbps. To translate that to Bytes per second you divide by 8 (since there are 8 bits in every byte), and you find that a T1 can transfer data at 192 KBps. Multiply that by 60 seconds in a minute, times 60 minutes in an hour, and you will find that a T1 can transfer 691.2 MB of data per hour, or 6.589 GB per day. Assuming that your web traffic is evenly spread over a day(which in most hosting situations it isn’t, of course) your cost per GB of data transferred—given T1 costs of $2000/month—is just over $4.
The Mathematics:
- 1.536 Mbps /8 = 192KBps
- 192 KBps * 60 seconds/minute = 11.52 MB/minute
- 11.52 MBps * 60 minutes/hour = 691.2 MB/hour
- 691.2 MB/hour * 24 hours/day = 16.589 GB/day
- 16.589 GB/day * 30 days/month =497.67 GB/month
- Hence, Monthly cost/GB = $2000 / 497.67 GB = $4.02/GB of data transferred.
But, there’s still more…
In most cases, you will have peak times of web page viewing. If you have a steep curve, you need to keep this in mind and adjust your cost calculations appropriately. For example, most of your traffic were concentrated in a peak period of 4 hours, then,
- 691.2 MB/hour x 4 peak hours/day =2.765 GB/peak period/day
- 2.765 GB/peak period x 30 days = 82.944 GB/Month
- Monthly cost = $2000 / 82.944 GB = $24/GB of peak charges.
Mbps costing
Commonly, Mbps is usually calculated by the 95th percentile rule. Meaning, every month, all of the samples are pulled and ordered from highest to lowest. The top 5 percent of readings are then discarded, and the customer is billed based on the next highest reading.
The Mbps costing is usually done with a committed rate and a burst rate. The burst rate is usually a $20-25 increase over the committed rate. If your T1 costs $2000/month including local loop (always include loop charges), then your Mbps cost is $1,302.08/month. So, how do you make money? By oversubscribing your pipes. With oversubscription, you are betting that even though someone is committing to 1 Mbps, they will not use the full 1 Mbps continuously. The typical oversubscription rate is 4 times, which—using our arbitrary numbers—makes your cost per Mbps $325.50/month.
As such:
- $2,000 / 1.536 Mbps = $1,302.08/Mbps monthly
- $1,302.08 / 4x oversubscription rate = $325.50/Mbps monthly (oversubscribed)
I hope that clears up some confusion on why some hosting companies can offer you cheap bandwidth charges while others just won’t even consider lowering theirs.
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