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dougmig33 at yahoo.com
Guest
PostPosted: Fri Mar 28, 2008 1:03 am    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally bill in?

We've been using carriers that bill 1/1, and the quality hasn't been too good, lots of 503's etc. We just started testing with someone else that offers much better ASR's (they failover internally between qwest, global crossing etc), but they bill 30/6. According to THEM, only companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

Thanks,
Doug.




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trixter at 0xdecafbad.com
Guest
PostPosted: Fri Mar 28, 2008 2:01 am    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
On Thu, 2008-03-27 at 22:56 -0700, Douglas Garstang wrote:
Quote:
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally
bill in?

We've been using carriers that bill 1/1, and the quality hasn't been
too good, lots of 503's etc. We just started testing with someone else
that offers much better ASR's (they failover internally between qwest,
global crossing etc), but they bill 30/6. According to THEM, only
companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

First, does it really matter? How many calls do you make that are less
than 30 seconds? Will the 6 second increment really affect your total
price? If the new price is higher, is the quality worth it?


I am unsure if there is a relation between billing increments and
quality, but ok.

As for what a provider bills at that is up to the provider itself. This
may be passed on from the carriers they are using to terminate calls.
Generally on the PSTN (at least in the US) you will see a higher first
minute and lower additional minutes. This is because to set up the call
a few queries have to be made which cost the carriers money. Even if
the phone isnt answered there are these costs. So what they do is
charge a higher first minute to recover these costs and when the phone
is never answered they write that off into other costs which is paid for
in part by that first minute and each additional minute.

Now most residential service in the US is billed in whole minute
increments while many business plans are 6 second increments. Really
there isnt any reason for them to not be each second increments.

For short duration calls a higher billing increment is more profitable,
which means that other costs can be absorbed by that.

Since few PSTN based carriers offer 1/1 billing (I think this is
changing though) on most plans it may be true that you cant do 1/1 with
quality carriers as a general rule. I do not however believe it to be
an absolute rule, and again there is cost vs quality.

Its very likely that their carriers are doing 30/6 or 6/6 to them, which
are (or at least were) very common business billing plans. I dont know
why they did 6 seconds, the carriers claimed it had something to do with
the way that duration was calculated over a decade ago, that the systems
would not let them do 1/1. I didnt believe it then, and certainly now
its not true, or if it is there is no real reason for it to be true
(intercarrier settlements are often enough millisecond resolution
showing that it doesnt have to be true).

Most of this is just to bill for "slack time", and it extends far beyond
this, telecom USA did that 1010220 or whatever, 99 cents for the first
20 minutes, 5 cents there after. Well if you do the math, its 5 cents
for each minute, unless you hang up before 20. They relied on the slack
time for profit (this plan is many years old, it may be cheaper now).


--
Trixter http://www.0xdecafbad.com Bret McDanel
Belfast +44 28 9099 6461 US +1 516 687 5200
http://www.trxtel.com the phone company that pays you!


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yair at hakak.com
Guest
PostPosted: Fri Mar 28, 2008 2:12 am    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
hi,
first of all, as far as i know, there are a lot of short calls. think
of all the calls that end in a voicemail box where the caller doesn't
leave a message. There is a lot of slack in 30 second minimums.

and, historically, 6/6 was used because 6 seconds is 10% of a minute -
it just makes the billing much easier - move the decimal point over 1
digit and that's it. 1/60 = 0.0166 (bar) which makes for one fugly
increment and means everything has to be rounded to reach a number
that doesn't have an infinite fraction at the end of it.

-yair

On Fri, Mar 28, 2008 at 9:52 AM, Trixter aka Bret McDanel
<trixter@0xdecafbad.com> wrote:
Quote:

On Thu, 2008-03-27 at 22:56 -0700, Douglas Garstang wrote:
Quote:
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally
bill in?

We've been using carriers that bill 1/1, and the quality hasn't been
too good, lots of 503's etc. We just started testing with someone else
that offers much better ASR's (they failover internally between qwest,
global crossing etc), but they bill 30/6. According to THEM, only
companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

First, does it really matter? How many calls do you make that are less
than 30 seconds? Will the 6 second increment really affect your total
price? If the new price is higher, is the quality worth it?


I am unsure if there is a relation between billing increments and
quality, but ok.

As for what a provider bills at that is up to the provider itself. This
may be passed on from the carriers they are using to terminate calls.
Generally on the PSTN (at least in the US) you will see a higher first
minute and lower additional minutes. This is because to set up the call
a few queries have to be made which cost the carriers money. Even if
the phone isnt answered there are these costs. So what they do is
charge a higher first minute to recover these costs and when the phone
is never answered they write that off into other costs which is paid for
in part by that first minute and each additional minute.

Now most residential service in the US is billed in whole minute
increments while many business plans are 6 second increments. Really
there isnt any reason for them to not be each second increments.

For short duration calls a higher billing increment is more profitable,
which means that other costs can be absorbed by that.

Since few PSTN based carriers offer 1/1 billing (I think this is
changing though) on most plans it may be true that you cant do 1/1 with
quality carriers as a general rule. I do not however believe it to be
an absolute rule, and again there is cost vs quality.

Its very likely that their carriers are doing 30/6 or 6/6 to them, which
are (or at least were) very common business billing plans. I dont know
why they did 6 seconds, the carriers claimed it had something to do with
the way that duration was calculated over a decade ago, that the systems
would not let them do 1/1. I didnt believe it then, and certainly now
its not true, or if it is there is no real reason for it to be true
(intercarrier settlements are often enough millisecond resolution
showing that it doesnt have to be true).

Most of this is just to bill for "slack time", and it extends far beyond
this, telecom USA did that 1010220 or whatever, 99 cents for the first
20 minutes, 5 cents there after. Well if you do the math, its 5 cents
for each minute, unless you hang up before 20. They relied on the slack
time for profit (this plan is many years old, it may be cheaper now).


--
Trixter http://www.0xdecafbad.com Bret McDanel
Belfast +44 28 9099 6461 US +1 516 687 5200
http://www.trxtel.com the phone company that pays you!


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mitul at enterux.com
Guest
PostPosted: Fri Mar 28, 2008 4:23 am    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
Hi Doug,

Quoting Douglas Garstang <dougmig33@yahoo.com>:

Quote:
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally bill in?

We've been using carriers that bill 1/1, and the quality hasn't been
too good, lots of 503's etc. We just started testing with someone
else that offers much better ASR's (they failover internally between
qwest, global crossing etc), but they bill 30/6. According to THEM,
only companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

Well unless you are talking to TIER 1 Carriers (AT&T, Verizon, Level3,
MCI) you are talking to middle men, who may promise 1/1 but would give
a real hard time on ASRs.

Also as you may see, its all mathematics 30/6 and they can route you
through different carriers (mebbe sometimes even on premium routes, coz
their math allow them to do so.)

Again, the good ol saying is still true - "You get wat you pay for !!"

Thanks & Regards,
Mitul Limbani,
Founder & CEO,
Enterux Solutions,
The Enterprise Linux Company (TM),
www.enterux.com
(P.S.: These are my views)

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Jay at thehorizongroup...
Guest
PostPosted: Fri Mar 28, 2008 11:46 am    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
There are Tier 1 USA carriers that will terminate 1/1 on an ICB basis. Many
of the resellers of USA Tier 1's will bill USA termination in 1/1 on special
request, especially if you're buying international from them. And of course,
if you have a volume of minutes. For those who claim that when you are
offered 1/1 billing for USA or international termination that you are
getting a substandard route, well keep on buying in 30/6!

Regards,

Jay Kordic
The Horizon Group
Wholesale VOIP/TDM routes/Wholesale IP Bandwidth
1-951-744-9220
1-515-322-0273(fax)
MSN IM- Jaykordic@hotmail.com

March Madness specials
1.ALASKA TERMINATION as low as .0105minute with 90%+ASR's.

2.USA termination offered with a virtual local ANI/CLI.The rates as low as
.004/minute(10 million minute minimum per month for this rate)with 1/1
billing increments.Other rates are available (.0045/.005/.0055) for a lower
commitment.This route covers 115,000 npa/nxx's.The underlying carrier on
this route is a USA Tier 1 provider.

3.USA termination offered with a virtual local ANI/CLI.This route covers
48,732 npa/nxx's in 72 markets and has a rate of .003/minute with 1/1
billing increments.The underlying provider is a USA Tier 1 provider.

4.Internet bandwidth from USA Tier 1 providers for Fast E/Gig E as low as
$14/mb.Includes XO,GX,L3,Qwest,UUNet and more.

5.8XX termination access compensation(.002 -.006/minute)/CABS
compensation(.002-.035/minute).

NEED COLOCATION ? Ask me about it.
Atlanta, GA
Charlotte, NC
Chicago, IL - 350 E. Cermak Road
Chicago, IL - 600 S. Federal Street
Dallas, TX - 2323 Bryan Street
Dallas, TX - 8435 Stemmons Fwy
Los Angeles, CA
Miami, FL
NYC - 60 Hudson Street
NYC - 111 Eighth Avenue
Phoenix, AZ
San Francisco, CA
Santa Clara, CA
Weehawken, NJ

-----Original Message-----
From: asterisk-biz-bounces@lists.digium.com
[mailto:asterisk-biz-bounces@lists.digium.com] On Behalf Of Mitul Limbani
Sent: Friday, March 28, 2008 2:02 AM
To: asterisk-biz@lists.digium.com
Subject: Re: [asterisk-biz] ITSP Billing Increments....?

Hi Doug,

Quoting Douglas Garstang <dougmig33@yahoo.com>:

Quote:
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally bill
in?
Quote:

We've been using carriers that bill 1/1, and the quality hasn't been
too good, lots of 503's etc. We just started testing with someone
else that offers much better ASR's (they failover internally between
qwest, global crossing etc), but they bill 30/6. According to THEM,
only companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

Well unless you are talking to TIER 1 Carriers (AT&T, Verizon, Level3,
MCI) you are talking to middle men, who may promise 1/1 but would give
a real hard time on ASRs.

Also as you may see, its all mathematics 30/6 and they can route you
through different carriers (mebbe sometimes even on premium routes, coz
their math allow them to do so.)

Again, the good ol saying is still true - "You get wat you pay for !!"

Thanks & Regards,
Mitul Limbani,
Founder & CEO,
Enterux Solutions,
The Enterprise Linux Company (TM),
www.enterux.com
(P.S.: These are my views)

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dougmig33 at yahoo.com
Guest
PostPosted: Fri Mar 28, 2008 1:07 pm    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
Quote:
Hi Doug,

Quoting Douglas Garstang <dougmig33@yahoo.com (dougmig33@yahoo.com)>:

Quote:
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally bill in?

We've been using carriers that bill 1/1, and the quality hasn't been
too good, lots of 503's etc. We just started testing with someone
else that offers much better ASR's (they failover internally between
qwest, global crossing etc), but they bill 30/6. According to THEM,
only companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

Well unless you are talking to TIER 1 Carriers (AT&T, Verizon, Level3,
MCI) you are talking to middle men, who may promise 1/1 but would give
a real hard time on ASRs.

We've been using Verizon to terminate to Russia. Their ASR's have been HORRIBLE. They would regularly reject 50% or more of calls during peak times with SIP server side final responses (500+). They informed us they don't offer any sort of SLA's... pretty funny for a tier one carrier. How can you report problems when there is no standard by which to measure quality? Qwest offer SLA's, but it's so damn complicated, we are still trying to understand it.

Doug.






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dougmig33 at yahoo.com
Guest
PostPosted: Fri Mar 28, 2008 1:07 pm    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
Quote:
On Thu, 2008-03-27 at 22:56 -0700, Douglas Garstang wrote:
Quote:
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally
bill in?

We've been using carriers that bill 1/1, and the quality hasn't been
too good, lots of 503's etc. We just started testing with someone else
that offers much better ASR's (they failover internally between qwest,
global crossing etc), but they bill 30/6. According to THEM, only
companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

First, does it really matter? How many calls do you make that are less
than 30 seconds? Will the 6 second increment really affect your total
price? If the new price is higher, is the quality worth it?

I don't know why, but yes, a lot of our calls are short. Just about all our volume is international, and I guess since a large number of our users are on cell phones, that may somehow be a factor.

Quote:


Since few PSTN based carriers offer 1/1 billing (I think this is
changing though) on most plans it may be true that you cant do 1/1 with
quality carriers as a general rule. I do not however believe it to be
an absolute rule, and again there is cost vs quality.

Teleglobe and Arbinet do. I think Verizon does as well.






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jweisman at ibell.net
Guest
PostPosted: Fri Mar 28, 2008 4:40 pm    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
In my experience:

30/6 is always Tier 1 TDM
6/6 USA
60/60 Mexico

1/1 has always been grey routes that are great one day, and terrible the next. Damn Lucent and their TNT's Smile

-Jon


Quote:
----- Original Message -----
From: Douglas Garstang (dougmig33@yahoo.com)
To: Commercial and Business-Oriented Asterisk Discussion (asterisk-biz@lists.digium.com)
Sent: Friday, March 28, 2008 2:00 PM
Subject: Re: [asterisk-biz] ITSP Billing Increments....?



Quote:
Hi Doug,

Quoting Douglas Garstang <dougmig33@yahoo.com (dougmig33@yahoo.com)>:

Quote:
So, I have a general question.

What billing increments do ITSP's who terminate SIP->PSTN normally bill in?

We've been using carriers that bill 1/1, and the quality hasn't been
too good, lots of 503's etc. We just started testing with someone
else that offers much better ASR's (they failover internally between
qwest, global crossing etc), but they bill 30/6. According to THEM,
only companies that can't offer top quality routes bill 1/1.

What's the deal here? Is this true?

Well unless you are talking to TIER 1 Carriers (AT&T, Verizon, Level3,
MCI) you are talking to middle men, who may promise 1/1 but would give
a real hard time on ASRs.

We've been using Verizon to terminate to Russia. Their ASR's have been HORRIBLE. They would regularly reject 50% or more of calls during peak times with SIP server side final responses (500+). They informed us they don't offer any sort of SLA's... pretty funny for a tier one carrier. How can you report problems when there is no standard by which to measure quality? Qwest offer SLA's, but it's so damn complicated, we are still trying to understand it.

Doug.






Looking for last minute shopping deals? [url=http://us.rd.yahoo.com/evt=51734/*http://tools.search.yahoo.com/newsearch/category.php?category=shopping]Find them fast with Yahoo! Search.[/url]

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linus at magrathea-tel...
Guest
PostPosted: Fri Mar 28, 2008 5:06 pm    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
Quote:
We've been using carriers that bill 1/1, and the quality hasn't been too
good, lots of 503's etc. We just started testing with someone else that
offers much better ASR's (they failover internally between qwest, global
crossing etc), but they bill 30/6. According to THEM, only companies that
can't offer top quality routes bill 1/1.

Well, I can't speak for the US, but as far as Europe is concerned that is
complete nonsense. All the top tier operators in Europe bill per second.

Linus


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c.savinovich at itntel...
Guest
PostPosted: Fri Mar 28, 2008 5:35 pm    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
Let's put it in even simpler terms. True story by the way: Spain cellular
sells for 19cents per minute the cheapest anyone can find (this is only an
example)... So I calculate I can resell for 23cents per minute. But then
everybody tells me that they prefer to buy from X, who was selling at 18
cents. It took me time to figure it out, but now I know: I billed at 6
cents increments and they billed at 60 seconds increments, and probably
their minutes lasted 55 seconds. It worked for them beautifully since
average length of a call on that route was 6 minutes.

Conclusion: the cheapest quality routes charge 30/30 or 60/60 to cover for
the cheaper price you think you are getting.

C. Savinovich


-----Original Message-----
From: asterisk-biz-bounces@lists.digium.com
[mailto:asterisk-biz-bounces@lists.digium.com] On Behalf Of Linus Surguy
Sent: Friday, March 28, 2008 3:00 PM
To: Commercial and Business-Oriented Asterisk Discussion
Subject: Re: [asterisk-biz] ITSP Billing Increments....?

Quote:
We've been using carriers that bill 1/1, and the quality hasn't been too
good, lots of 503's etc. We just started testing with someone else that
offers much better ASR's (they failover internally between qwest, global
crossing etc), but they bill 30/6. According to THEM, only companies that
can't offer top quality routes bill 1/1.

Well, I can't speak for the US, but as far as Europe is concerned that is
complete nonsense. All the top tier operators in Europe bill per second.

Linus


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trixter at 0xdecafbad.com
Guest
PostPosted: Fri Mar 28, 2008 6:33 pm    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
On Fri, 2008-03-28 at 22:00 +0000, Linus Surguy wrote:
Quote:
Quote:
We've been using carriers that bill 1/1, and the quality hasn't been too
good, lots of 503's etc. We just started testing with someone else that
offers much better ASR's (they failover internally between qwest, global
crossing etc), but they bill 30/6. According to THEM, only companies that
can't offer top quality routes bill 1/1.

Well, I can't speak for the US, but as far as Europe is concerned that is
complete nonsense. All the top tier operators in Europe bill per second.

Yeah this is largely a US conversation based on the initial poster,
although its not bad to comment on how carriers in other parts of the
world do it for comparison. Back in the 80s many carriers refused to do
business service in the US with less than 6/6, I think MCI was the first
to offer that to compete with AT&T who was doing 60/60 at the time.
They claimed at the time they couldnt do less because their billing
systems wouldnt let them, the custom written billing systems that they
have ...

--
Trixter http://www.0xdecafbad.com Bret McDanel
Belfast +44 28 9099 6461 US +1 516 687 5200
http://www.trxtel.com the phone company that pays you!


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trixter at 0xdecafbad.com
Guest
PostPosted: Fri Mar 28, 2008 7:27 pm    Post subject: [asterisk-biz] ITSP Billing Increments....? Reply with quote
On Fri, 2008-03-28 at 18:32 -0700, C. Savinovich wrote:
Quote:
Let's put it in even simpler terms. True story by the way: Spain cellular
sells for 19cents per minute the cheapest anyone can find (this is only an
example)... So I calculate I can resell for 23cents per minute. But then
everybody tells me that they prefer to buy from X, who was selling at 18
cents. It took me time to figure it out, but now I know: I billed at 6
cents increments and they billed at 60 seconds increments, and probably
their minutes lasted 55 seconds. It worked for them beautifully since
average length of a call on that route was 6 minutes.

Conclusion: the cheapest quality routes charge 30/30 or 60/60 to cover for
the cheaper price you think you are getting.


I would put that in the same category as all tier 1 dont do 6/6 or 1/1.
It may be true for some, but I dont think that its true for all (nor do
I believe the reverse of that). It depends on various factors, how you
interconnect, where in some situations, what plan you can convince the
sales rep to give you, etc. The same carrier may do 1/1 and 6/6 but
charge different rates for each and the rates may be so different that
1/1 isnt worth it.

You also said that 19 cents is the cheapest anyone can find, but that
someone is offering it for 18 cents, so by finding the provider that
offers it for 18 cents wouldnt that mean that you found something
cheaper than 19? Ok tangent safe to ignore this paragraph Smile

If you look at it this way, statistically speaking 50% of the calls will
be in the lower 50% of the bill increment and 50% of the calls will be
in the higher 50% of the bill increment. Yes statistics dont always
match the real world, but it works as a base guage, and generally they
should match up with a large enough sample.


Assumptions made: the carrier is billing in 1/1 increments. The itsp
is billing 60/60. Cost is 19 cents, its sold at 18 cents.

50% average slack time per final minute means that 9 cents of slack
money is generated.

With a 6 minute average the charge to the customer would be 0.18*6=1.08.
The charge to the ITSP would be (5.5 minutes given the 50% statistical
average listed above) 5.5*0.19=1.045, for a grand profit off that one
call of 3.5 cents.

If you had 20 minute averages you would see a loss of 10.5 cents. For
each 20 minute call you need three 6 minute ones to make up for it. The
break even point with these numbers would be about 9.5 minutes, above
that you lose money on the call, below that you get a minor profit.

Yeah do a few thousand calls per day at the 6 minute average and you
might be able to pay your bills, 5000 calls is only 175
[dollars/euro/etc] per day, which really isnt enough for rack space,
bandwidth, office space, support staff, etc. You would be lucky to
break 5000/mo off that.

Now if you are big enough and doing enough total volume to enough
different places and the math is similar you may be able to make a
reasonable profit, making up in volume what you dont get per call.

Smaller operators would have a problem just paying their bills let alone
salaries however. Larger operators can generally negotiate better rates
as well, which in turn makes them more profitable however they generally
have more overhead which can reverse this trend.

You also have a huge exposure, if the 6 minute trend goes up, even by a
minute, you will see a huge downturn in your income (about 16%), and you
are really close to the border where you lose money on each call.

In short you dont make enough to sell below cost by doing that unless
you only get short calls or your initial increment is much longer than
the average call (like telecom usa with their 20 minute first increment,
and the average voice call when they advertised heavily was 4.3
minutes).

Where slack billing should come in is for gravy. If they charged 19
cents to beat your 23, they would never lose money (on the call itself),
and would make a small amount per call, in this example it would be
about an average of 9.5 cents per call, far better than the 3.5 cents
above. Do a few thousand calls per day and the gravy pot starts to fill
up. It is likely that they have a deal somehow somewhere for a cost
closer to 18 cents, perhaps with a direct connect to the carriers,
perhaps something else.

Now if you offer a "regular" and a "premium" service level where the
only real difference is the bill increment and priority (ie regular can
be dumped in lieu of a premium call, or just wont go through if there
arent enough channels available, etc) you can bill regular at carrier
cost using slack to make some extra, where premium is billed at a higher
rate, so the profit comes from the additional amount charged.

In this way you get customers who are willing to pay more for better
quality, as well as the ones that arent willing to pay more, and instead
of having gobs of idle time on your system you turn a slight profit.

Now if you also had a lower level than regular you could sell idle
capacity potentially below cost (total cost, bandwidth, servers, support
staffers, as well as termination charges) to lose $500 is better than to
lose $1000 so getting something in *some* situations can be better than
getting nothing. When it comes to phone minutes (and network bandwidth,
and ...) if you dont use it at this moment in time its gone forever, you
can never recapture minutes that have already passed.

The rapidly falling costs of bandwidth, rack space, etc is making the
last option less desirable because the costs involved to actually
operate have dropped. They will never reach zero, but in time they will
approach zero.

It used to be that it took millions to get even a small infrastructure,
and operating costs per day were quite high with all the skilled labour
that was required. Those carriers are more likely to give "best effort"
quality just to slow the attrition of funds from their bank accounts.
New providers, especially ITSPs, are far less likely to see any value in
that.



--
Trixter http://www.0xdecafbad.com Bret McDanel
Belfast +44 28 9099 6461 US +1 516 687 5200
http://www.trxtel.com the phone company that pays you!


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