Bandwidth costs are actually free, so this isn't exactly accurate.
Most bandwidth is via settlement-free peering with thousands of ISPs around the world. At least that's how we did it at Twitch, and how we did it when I worked at a large CDN before that. There are still costs for backhaul, interconnect, colocation space, dark fiber, network hardware, and transit to fill the gaps. But this talk about how "Google can magically do it 5x cheaper" is nonsense.
I think vundercind was implicitly including Twitch in the phrase "except for a very-few other megacorps".
If you're wondering, if you can't get peering, you wind up like Twitch. In South Korea. South Korean telecom law explicitly shifts the capital expenditure costs of ISPs over to other online services, which is sort of like the fucked-up opposite of Net Neutrality regulation. So Twitch was being bled dry to pay for the chaebols' network expansion. Hell, even after Twitch left, South Korea fined them for leaving!
> In the wake of them ceasing service, Twitch has been fined for 435 million Korean won – but not for the entire service being terminated. This is related only to them making it so users in South Korea can’t access VODs on the platform, something seen as a direct violation of South Korea’s telecom laws by Korea’s Telecommunications Commission (KCC).
> According to Yonhap, the KCC made the decision that Twitch terminating the ability for users in South Korea to access VODs wasn’t necessary to keep the service alive. When asked to justify their claims, Twitch declined due to contractual obligations related to keeping user and site data private.
> Additionally, Twitch would have to present evidence that their decision to gradually take features away from South Korean users & leave the country was necessary. This means that Twitch isn’t likely to return service to South Korea any time soon.
> There’s also a good chance Twitch will be forced to provide refunds for those who have been affected by the service being discontinued, with the KCC warning Twitch that they need to prepare “user protection measures” as they cease service in the country.
> There are still costs for backhaul, interconnect, colocation space, dark fiber, network hardware, and transit to fill the gaps.
Genuine question - aren't those gaps essentially what make a video streaming service operate at scale though? It'd be like saying "ya this bus can get everyone from NYC to Philly at $10 but doesn't stop anywhere in between", or am I missing something about all of those gap filling components?
That isn't free. For every terabit of bandwidth, you have to physically build out a terabit of network. Not even remotely free. Having already built the network, and being already paying to run it, you can then use it for free, yes.
This is the model for all networks, indeed, most businesses - they pay a big upfront and moderate recurring cost to make a fast network (or restaurant or widget factory) and then sell it in slices with a large freedom to choose a pricing model. Pay per terabyte is a pretty reasonable way to pass on the network's fixed cost to consumers, just like part of the cost of the restaurant meal covers the interior decorations, even though the decorations don't actually cost more the more people eat, until the restaurant gets so busy it needs to expand.
I didn't say it's free of cost. My point is that a terabit of bandwidth delivered to consumers in a particular geographical area doesn't require a terabit of bandwidth from the center to that area, because much of the content can be cached.
So the 'terabit of network' the content provider needs to build need only span a few hundred feet within a single building.
I never said it did. You still have to build whatever you want. A terabit of edge network is a terabit of edge network that has to be physically built.
Not all networks are the same. Some have terabit backbones and gigabit edges, some have the reverse. We'd still call both of them, roughly, terabits of network, and you still have to build them. The one with the terabit core might actually be easier because you have less of the expensive really fast equipment.
In some ways it's less scary: no long inter-site fiber runs that I assume are an absolute nightmare, and no renting those same runs at exorbitant rates. All your hands-on work remains in the datacenter, which is set up to make it a breeze. In other ways it's more scary: you have to negotiate with a lot more counterparties and visit a lot more datacenters.
Typically the problem is that Comcast won't peer with you. They always use the excuse that they only peer with equals, and since they aren't sending you as much traffic as you're sending them, it's not in line with their peering policy. This, of course, is a problem of their own creation; they're cable so customers all have a tiny amount of upload bandwidth and a large amount of download bandwidth. It is unlikely their policy permits peering with anyone. The ultimate effect is that you have to buy transit from a Tier 1 ISP instead of with the consumer ISP directly, costing you money. There are, of course, backroom deals where they sell a subscription tier that doesn't include video and then they throttle all the video. That's different than the peering issues; there is enough capacity to send all of your packets to them, they just throttle them on their end to squeeze money out of their customers.
I've worked at 2 ISPs and we obviously didn't have this peering policy, because it's dumb and it breaks the Internet. We also didn't throttle video, because it's dumb and breaks the Internet.
Most bandwidth is via settlement-free peering with thousands of ISPs around the world. At least that's how we did it at Twitch, and how we did it when I worked at a large CDN before that. There are still costs for backhaul, interconnect, colocation space, dark fiber, network hardware, and transit to fill the gaps. But this talk about how "Google can magically do it 5x cheaper" is nonsense.