So, what really makes a data plan more efficient than another one or more

desirable to use than it's really efficient.

But what are some good characteristics that data plans should have that we can

use to compare different solutions, right.

So, we've seen a few of them up to now. so there's definitely way too many of

them to list. I mean people use all different types of

criteria to characterize data plans and see which ones are really good and which

ones aren't per say. But, we can look at three main ones that

are typically cited here. First is economic viability, right.

So, just thinking about the ISPs for a second.

ISPs themselves, they need to be able to recover their cost and they need to be

able to maximize the profit after they've recovered cost, right?

So, once they've done this, they make any move to try to maximize their own profit,

right? So, ISPs are profit seeking companies,

they're not just non-profit organizations there to serve us.

They need to make money too. So, this is the first one, right, that

from the ISP standpoint it makes sense that they can recover the cost of

supplying the network and then make money off of it as well.

Second ones pretty interesting, the idea of fairness.

Now, fairness is a huge topic in networking and we won't have time to even

touch fairness at all. But really the idea is what allocation is

fair, right? What networking allocation is fair, and

that's the main idea. But here what we're basically saying that

consumer A shouldn't have to pay for consumer B, right, or subsidize the

lifestyle of consumer B. And to look at that, we, we can consider

an example here, right. So, just take, take an example of three

people who are on an ISP, right. over a month period.

Let's say Anna here consumes 2MB, Ben consumes 6GB, and Charlie consumes 10GB.

So, in the first pricing method, we're going to say, okay, like, somewhat of a

flat rate. We're going to say let's find a single

value to be able to charge everyone so the ISP can still recover its cost at

least, right. So, suppose the ISP has to pay itself or

the ISP itself incurs a cost at about $10 for every GB of data that's consumed,

okay. Not saying that it's going to charge them

that. because it's not going to charge them,

it's going to charge everyone the same amount in the end per month.

But the ISP incurs a charge of $10 per GB, okay.

So, the first thing you'd say is, okay, well, we have to figure out what the

average user is, right? So, or we have to figure out per person,

what's the average number of GB being charged, so we can charge everyone the

same amount, in total. Alright so, the average person is

consuming, if we add 2, and 6, and 10 and we have to divide by 3 to average.

That's 18 divided by 3, which is 6GB. 6GB.

So, on average, everyone's consuming 6GB. Multiply 6 by 3 you get 18, which is the

total number right here that's being consumed, right.

And we said the ISP's incurring costs of $10 for every GB.

So, the total cost that the ISP is facing per user.

Again, remember this is, this is now per user, because everyone on average is

doing 6GB. So, on average 6GB, and then $10 per GB

means we have 6 times 10, which is $60 per person.

That's about the cost the ISP is incurring per user.

So, the first scheme would be to say that everyone, Anna, Ben and Charlie, we can

say A, B and C, each are going to be charged $60.

So, now we can figure out, per GB, equivalently what are they being charged,

right. So, Anna's, only consuming two GB which

she's paying $60. So, that means she's really paying $30,

for each GB of data she's consuming. Now, Ben is consuming, actually the

average amount. So, he's paying exactly $10 [SOUND] per

GB. Which is, is good, that's fair for him,

at least, and $10 per GB sounds like a good number.

And Charlie, on the other hand, is paying $6 per GB.

So, you can see that everyone's paying a different amount per GB.

Now, what's really unfortunate is that Anna is paying $30 for every GB, and

Charlie's only paying $6 for every GB, right?

right? Because he's consuming so much more and

Anna's consuming so much less. And so we would say that, really, what's

happening is that Anna is subsidizing Charlie's lifestyle because she has to

pay more because Charlie pulled this average value up.

And made this go higher whereas and then she as a result has to pay more per GB of

consumption. So, we say that that's really not fair.

Okay and so we say in this case we say consumer A is paying for consumer B.

So, let's consider another example right now, let's just say well, what if we just

charge everyone $10, per GB, right? That makes sense, because the ISP incurs

$10 for every GB of data that they are saying, as we said right there.

So, let's just charge everyone the same amount that they're basically causing the

network harm. Alright.

So, then A is going to get $10 times 2, which is $20 total each month.

That's how much Anna is going to have to pay.

Ben is going to have to pay 6 times $10, because he, because he makes 6GB, which

is $60. And Charlie's going to have to pay, 10

times $10, which is 100. So, now that probably makes a lot more

sense because now, Anna's paying the least by a lot.

And Charlie's paying the most by quite a big difference.

And there's 40 in between, so Ben's, again, right in the middle of each of

them right here. But again, Charlie is paying the most,

Anna is paying the least. So, we don't have that problem anymore

where Anna isn't subsidizing Charlie's lifestyle.

So, we're going to say that this is, from a fairness standpoint, probably quite

acceptable. And the third one is consumer choice, and

really all it's saying is that there should be alternatives, right.

So, the consumer should be able to choose from different options.

Like for instance we saw on the Verizon Wireless plan that you know, you could

pay $30 up to however many GB, then need to pay $10 per GB after that and then.

Or you could pay $50 flat rate up to maybe 5GB then pay $10 after that, or you

could pay $80 and so on. Those are all different choices, right?

They're all different alternatives for the data plan.

So, in other criteria that they should all, they should have alternatives.

So, three criteria here, that are commonly cited are economic viability,

fairness and consumer choice.