The Terabyte Household

I was just in a meeting the other day with a bunch of ISPs were talking about household downloads. Several said that they were now seeing monthly data usage exceed a terabyte, and those with Comcast were lamenting that this is causing them a lot of money.

I wrote a lot about Comcast data caps a few years ago when the company experimented with really low data caps of 300 gigabytes per month. At that time a lot of households complained that they were exceeding those caps. Comcast was arguing at the time to end net neutrality and I think this persuaded them to back off of the low caps, which they set to 1 terabyte.

Here we are only a few years later and a lot of households are bumping up against and exceeding that data cap. Comcast absolutely knew this was coming and they just pushed the ability to monetize data caps a few years into the future. As an ISP the company knows better than most that the household demand for total downloaded data has been doubling every three years or so. That kind of growth will push a huge number of households over a terabyte within a decade – with many already hitting it now.

Comcast tries to justify data caps by arguing fairness – the same argument they made a few years ago. They say that those that use the Internet the most ought to pay the most. Even if you can buy that argument the penalty for exceeding the data caps are excessive. Comcast doesn’t charge a household for the first two months they exceed a terabyte. After that they have two plans. They will automatically bill $10 for every extra 50 Gigabytes over the data cap – with total excess charges capped at $200 per month. Customers who expect to exceed the data cap can also agree to pay $50 extra every month to get unlimited usage.

Comcast goes on to explain away the terabyte cap by describing what it takes to exceed the cap, as follows:

  • Stream between 600 and 700 hours of HD video
  • Play online games for more than 12,000 hours
  • Stream more than 15,000 hours of music
  • Upload or download more than 60,000 hi-res photos

This explanation is simplistic for a number of reasons. First, full Netflix HD broadcast at 1080p streams at over 7 Mbps and uses roughly 2.5 GB per hour, meaning a terabyte will cover about 400 hours of full HD video. If you have a good broadband connection the chances are that you are watching a lot of 4K video today – it’s something that Netflix and Amazon Prime offer automatically. It only takes only about 180 hours of 4K video in a month to hit the terabyte data cap – a number that is not hard to imagine in a cord-cutting home. The chart also misses obvious large uses like downloading games – with download sizes over 40 GB for one game becoming common.

The Comcast charts also fail to recognize the hidden ways that we all burn through bandwidth today. It’s not untypical for the average household to have a 30% to 40% overhead on Internet usage. That comes from the network having to transmit data multiple times to complete a download request. This overhead is caused for a number of reasons. First are inefficiencies inherent in the open Internet. There are always packets lost on transit that much be sent multiple times. There are also delays caused by the ISP network, particularly networks that are undersized in neighborhoods and that hit capacity during the busy hours. The biggest cause of delays for most of us is in-home WiFi networks that creates a lot of collisions from competing signals.

There are also a lot of background use of the Internet today that surprises people. We now routinely use web storage to back up files. All of the software on our machines upgrade automatically. Many now use applications like video cameras and home alarms that connect in the cloud and that ping back and forth all day. All sorts of other things go on in the background that are a mystery – I’ve noticed my house has significant broadband usage even when we aren’t home. I’ve estimated that this background communication probably eats about 150 gigabytes per month at my house.

When I consider those issues the Comcast terabyte data caps are stingy. A household with a lot of network noise and with a lot of background traffic might hit the data caps using only half of a terabyte of downloaded video or other services like those listed by Comcast. A home today might hit the cap with 200 hours of full HD streaming or 90 hours of 4K streaming.

The other amazing aspect of the terabyte data caps is the charge for using more than a terabyte in a month. As mentioned above, Comcast charges $10 for every extra 50 GB. I’ve done the math for dozens of ISPs and most of my clients spend between $2 and $4 per month on average for the bandwidth per broadband customer. That number includes not only residential users, but for most ISPs also includes some huge commercial broadband customers. The average price varies the most according to how far an ISP is away from the Internet, and that component of the cost is fixed and doesn’t increase due to higher data volumes by the ISP. After backing out this fixed transport cost, my math says that an extra 50 GB of broadband costs an ISP only a few pennies. For a large ISP like Comcast that cost is significantly lower since they peer with the big broadband companies like Netflix, Google and Amazon – and traffic exchanged in those arrangements have nearly zero incremental cost of extra bandwidth.

Finally, the Comcast website claims that less than 1% of their users exceed the terabyte data caps. Only they know the numbers, but I find that hard to believe. When you look at the amount of usage needed to hit that cap there has to be a lot of cord-cutter households already exceeding a terabyte.

The bottom line is that Comcast is extorting homes when they force them to spend $50 per month for unlimited data usage. That extra bandwidth costs them almost nothing. Unfortunately, there isn’t a damned thing any of us can do about this any since Comcast and the other big ISPs got their wish and broadband is no longer regulated by the FCC.

How Much Bandwidth Does a Home Need?

cheetah-993774If there is any one question that I am asked the most it is this: how much bandwidth do customers really need? Of course, what most carriers are really asking me is how fast they should make their data products. It’s a very good question.

The glib answer is that every family is different. But it is possible to talk about the kind of bandwidth that various common activities require and to make some generalizations about the average home. You might recall this is what the FCC did back when they reset the definition of broadband at 25 Mbps download. They looked at expected broadband usage for homes of two, three and four people and used that as a way to justify increasing the definition of broadband.

Since video is now the largest use of data for most home that’s the natural place to start any calculation of needed bandwidth. The problem is that there is no standard size of a transmitted video and the size of a video stream is going to depend upon the compression techniques used by the company sending the signal. Rather than a standard size of a video stream there is instead a pretty wide range.

The speed at which an ISP might see video just got a lot more complicated to predict by Netflix. They have always tried to send an HD video at 5.6 Mbps. If the customer’s broadband connection was not good enough to support that speed, then Netflix cut the quality of the video stream and sent it at a much lower rate. Netflix announced that they are now going to be more dynamic in the way they size and send video. They will send high action HD video, for example, at a higher data rate than a low-action movie. They will also have more than one option for downsizing the video so that it doesn’t have to drop all the way to SD. This means a whole array of different speeds of video from Netflix.

While video is the primary way that households currently use bandwidth, you can’t ignore all of the other uses, most of which are growing quickly. For example, there is now a significant amount of data used automatically in the background without direction from the user. Programs update automatically or constantly communicate in both directions with the cloud. One big and growing use of household data is cellphone data offloading. People tend to forget that their cellphone on WiFi is busily using their home bandwidth. There is a lot of talk in the industry of migrating away from cellphone apps and running more cellphone programs directly in the cloud, and that will mean a significant increase in cellphone data usage.

It’s also important to recognize that the Internet is not perfect and that every bit that is sent to us doesn’t arrive perfectly the first time. Depending upon the quality of the connection with the ISPs at both end of a transmission, there can be anywhere from a few to a relatively large number of bits that must be sent multiple times to complete a file download. For example, it might really require 1.2 gigabits of bandwidth to download a gigabit file. One measure of this is latency, and while not a perfect predictor of the amount of re-sent bit packets, we know that the higher the latency the more packets that must be sent multiple times.

Another thing to consider is that you can’t use every bit of your Internet connection at one time. For example, if you have a 10 Mbps connection you can’t view two 5 Mbps video streams at the same time. This is due to what the industry calls overhead, which is the background processes that enable your device to communicate with the Internet. The amounts of overhead can vary, but it’s not usual to see 10% to 20% overheads in a home network – bandwidth that is used by your router and the ISP to communicate in the background or to provide buffers between different data streams. The more things you do at the same time, the greater the overhead becomes, which to engineers is called contention.

I’ve used my own home as an example before. We are two adults and a teen who don’t have traditional cable TV. We all have cellphones and we work and play using bandwidth a lot. There have been a few times when our Internet connection from Comcast slows down. We see that anytime that it hits about 25 Mbps that we start having trouble doing things if we are all trying to use the Internet. So for our household, for right now, 25 Mbps  seems to be our magic number. But that number constantly grows and I would expect our threshold to get higher month after month as more and more parts of our lives use the web.

Video and Broadband Speeds

slow-downAkamai has released their latest quarterly report on the state of broadband around the world. Akamai runs network monitoring software for large ISPs and the Internet backbone providers and they get a peek inside actual broadband speeds achieved by end users.

Overall the worldwide Internet keeps getting faster each year. The average speeds achieved by end users was 5.1 Mbps download in the third quarter of 2015, up 14% from the year before. Topping that list was South Korea at 20.5 Mbps followed by Sweden at 17.4 Mbps and Norway at 16.4 Mbps. The US placed 16th globally with an average speed of 12.6 Mbps, up 9.4% from a year ago.

Akamai says that only about 15% of the connection in the world are ready for 4K video which they estimate will require about a 15 Mbps connection. That’s not a totally accurate figure, but rather an average speed for a 4K video connection. Like with all video, the speeds required for any given video clip varies by how much the picture changes, with high action video requiring more bandwidth than low-action scenes.

And so a house that had exactly a 15 Mbps connection could watch some 4K video, but they might not be able to watch a very high-action film. Further, this measurement ignores the fact that these days homes have an additional need for bandwidth for a host of other uses that range from emails, programs and apps that talk to the cloud and a host of other things that happen in the background. It’s more realistic to think that a home is going to need something closer to 20 Mbps if they are going to want to reliably watch 4K video while accommodating other normal uses of bandwidth.

One of the most interesting statistics of the survey is that the number of homes that get at least 15 Mbps rose to 15% from only 5.2% a year earlier. It’s obvious that ISPs are selling more higher bandwidth connections.

There was a recent announcement that is going to have a big impact on the ability of people to watch quality video. Netflix announced that it is rolling out a new technology that is going to maximize the quality of video to each user experience. It is going to offer what it thinks is the best bit rate based upon the content being viewed and the viewer’s video stream. Again, this goes back to the fact that there is a significant difference between a high-action movie and one that just has people sitting and talking.

In the past Netflix only had a few standard speeds that they tried. If they were unable to get a stream through at the speed that people requested they would step the speed down to a fairly low level and hoped it worked. But for people on slow connections, this often has meant lower quality movies, but also transmission problems such pauses in the movie stream when viewing outpaced download.

The new technology is supposedly going to be a lot more dynamic. Before, if somebody asked for an HD stream then Netflix tried to send it out at 5.8 Mbps. If a customer’s ISP couldn’t handle this they were automatically downloaded to something much slower.

But now, Netflix will first set the download speed according to the content. There are low-action HD videos that might only need 4 or 4 Mbps. And so Netflix will figure out the optimum target speeds for each type of content. Further, they will use a wide range of possible step-downs in speeds rather than going directly from HD to a very slow speed.

I’ve seen this being touted in a number of articles as something that will save a lot of bandwidth for Netflix since they will not force all HD content into 5.8 Mbps streams. But those articles also see this as a savings for ISPs and I think they are wrong. I think this means that ISPs with very fast speeds will also see a bandwidth savings, but interestingly, ISPs with slow network speeds will probably see an overall increase in bandwidth demand from Netflix.

Today if an ISP offers 3 Mbps, then Netflix might send them an HD video at a third of that speed. But with this new technology Netflix is going to try to maximize the customer experience and will use up more of the available bandwidth. This technology will also make it easier for households with somewhat slow bandwidth to watch more than one video at a time and the Netflix algorithms will try to fit the content into the available data path.

For now Netflix is the only company doing this, but like with all breakthroughs you can expect the rest of the industry to catch up in a year or so. One thing is certain, and that is that web video is here to stay and ISPs are going to be under tremendous pressure to provide enough bandwidth to allow people to watch what they want online. There doesn’t seem to be any end in sight for the demand of household bandwidth.

 

What’s Up with 4K Video?

4K videoIt seems like I can’t read tech news lately without seeing an article mentioning something new going on with 4K video. So I thought I would talk a bit about what 4K is and how it differs from other current types of video.

4K is the marketing term to cover what is officially named Ultra High Definition (UHD) video. UHD video is distinguished from current high definition video by having a higher picture resolution (more pixels) as well as more realistic colors and higher frame rates (meaning more pictures per second).

Let’s start with some definitions. 4K video is defined by the Consumer Electronics Association as a video stream that has at least 3,840 X 2,160 pixels. This contrasts to existing high definition (HD) video that has 1,920 X 1,080 pixels and standard definition video (SD) that has 720 X 480 pixels. These are not precise standards—for example there is some SD video that is broadcast at 540 pixels. There is also an existing standard for some video cameras that record at 4,096 X 2,160 pixels which is also considered 4K.

The 4K standard was developed in an attempt to be able to deliver digital media to movie theaters. This would save a lot of money compared to shipping around reels of film. Standard HD does not project well onto the big screens and 4K will overcome a lot of these shortfalls. But high action movies require more definition than is provided by 4K and will require the upcoming 8K video standard to be able to be digitally transmitted for use on the largest screens.

Interestingly, there is not a huge increase in quality from shifting home viewing from HD to 4K. There is a huge improvement in quality between SD and HD, but the incremental improvements between HD and 4K are much harder to discern. The improvements are more due to the number of different colors being projected, because the human eye cannot really see the pixel differences when viewed on relatively small computers or home TV screens. It’s easy to get fooled about the quality of 4K due to some of the spectacular demo videos of the technology being shown on the web. But these demos are far different than what run-of-the-mill 4K will look like, and if you think back there were equally impressive demos of HD video years ago.

The major difference between HD and 4K for the broadband industry is the size of the data stream needed to transmit all of the pixel data. Current 4K transmissions online require a data path between 18 Mbps and 22 Mbps. This is just below the FCC’s definition of broadband and according to the FCC’s numbers, only around 20% of homes currently have enough broadband speed to watch 4K video. Google just recently announced that they have developed some coding schemes that might reduce the required size of a 4K transmission by 40% to 50%, but even with that reduction 4K video is going to put a lot of strain on ISPs and broadband networks, particularly if homes want to watch more than one 4K video at a time.

I recently read that 15% of the TVs sold in 2015 were capable of 4K and that percentage is growing rapidly. However, lagging behind this is 4K capable settop boxes; anybody that wants to get 4K from their cable provider will require a new box. Most of the large cable providers now offer these boxes, but often at the cost of another monthly fee.

Interestingly, there is a lot of 4K video content on the web, much of it filmed by amateurs and available on sites like YouTube or Vimeo. But there is a quickly increasing array of for-pay content. For instance, most of the Netflix original content is available in 4K. Amazon Prime also has Breaking Bad and other original content in 4K. It’s been reported that the next soccer World Cup will be filmed in 4K. There are a number of movies now being shot in 4K as well as a library of existing IMAX films which fit well into this format. Samsung has even lined up a few movies and series in 4K which are only available to people with Samsung 4K TVs.

One thing is for sure, it looks like 4K is here to stay. More and more content is being recorded in the format and one has to imagine that over the next few years 4K is going to become as common as HD video is today. And along with the growth of 4K demand will come demand for better bandwidth.