iPlayer "has tripled ISP's bandwidth costs"

 

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By Simon Aughton

Posted on 22 Feb 2008 at 14:50

ISPs could face a sharp increase in bandwidth costs as internet TV services such as the BBC's iPlayer continue to grow in popularity.

Data from one ISP, PlusNet, shows that its streaming costs tripled during January, the first full month in which iPlayer's streaming service operated.

The cost per user rose from 6.1p per month to 18.3p, and as an industry analyst has calculated, if PlusNet is taken as representative of the whole UK broadband market, then iPlayer added £1 million to ISPs' costs in the first month of 2008.

"The results should send shivers down the spine of any ISP currently offering an unlimited 'all-you-eat' service," says the analyst for STL. "The option for the ISP is either to allow a degradation in performance or order more capacity."

Since iPlayer and similar services bring ISPs no extra revenue, the likelihood is that most, like PlusNet, will rely on traffic shaping measures while trying to sell more of the higher price broadband services that guarantee higher service levels.

Not surprisingly, Ashley Highfield, the BBC's director of future media and technology, insists that iPlayer has had a "negligible impact on the UK internet infrastructure".

He too thinks it may help ISPs sell higher bandwidth service. "There may be a win-win for the industry where services like iPlayer drive demand from users for broadband access in the first place, and for higher bandwidth packages, and for (paid-for) quality-of-service guarantees from the ISPs," he says.