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Large ISPs Profit From BitTorrent Traffic, Study Finds

A new report published by Northwestern University and Telefónica Research discovered some BitTorrent trends worth sharing. During a 2-year period the researchers monitored an unprecedented sample of 500,000 people in 169 countries. Aside from showing that BitTorrent users download more and more data, the report also finds that large ISPs including Comcast are actually making money off BitTorrent traffic.

dollar moneyFor more than half a decade many Internet providers have throttled or even banned BitTorrent traffic on their networks. A claim often heard from ISPs is that heavy users are using too much resources and bandwidth.

However, a new report just published (pdf) by Northwestern University and Telefónica Research shows that for larger ISPs there’s an upside to BitTorrent as well. In fact, these companies make a substantial amount of money from BitTorrent traffic.

The goal of the research was to understand the network impact of BitTorrent, both in terms of traffic and the costs involved. To answer this question the researchers conducted a 2-year study where they tracked the downloads of 500,000 people for 169 different countries. The end result is an interesting trend report which, among other things, shows how BitTorrent traffic has developed over time.

For instance, the research found that the average download volume per user per hour increased by 25 percent between November 2009 (110 MB/hour) and November 2010 (139 MB/hour). The number of unique users on the other hand dropped by 10 percent, possibly because people finish their downloads faster. In total the absolute volume of BitTorrent traffic increased by more than 12 percent from 2009 to 2010.

Aside from these general BitTorrent trends, the researchers also looked at the directions BitTorrent traffic are taking. Surprisingly, they find that BitTorrent traffic stays very local. A third of all traffic (32%) does not leave the country of origin and an additional 41 percent only travels to one other country. The researchers further find that the majority stays in local lower tier networks.

The above has some very interesting implications for the costs of BitTorrent traffic for various ISPs.

The researchers translated their findings into the actual costs and revenues of Internet providers and found that contrary to what the public would expect, large Tier 2 ISPs actually make money off BitTorrent traffic. This means that companies such as Comcast, Virgin Media and France Telecom profit directly from heavy downloaders.

“Using inferred business relationships between ISPs, we showed that most BitTorrent traffic flows over cost-free paths and that it generates substantial revenue potential for many higher tier ISPs,” the researchers write.

But not all Internet providers make money off BitTorrent; those in the lower tiers where most traffic is flowing through have less local (and free) traffic and often have to pick up the bill.

“Unlike with tier 2, provider traffic is larger than customer traffic for tier 3, indicating that these ISPs on average are paying for rather than profiting from transit charges due to BitTorrent traffic,” state the researchers.

The report shows that BitTorrent traffic has very a different impact depending on the place an ISP has in the network. Higher tier companies mostly profit from BitTorrent downloads, while lower tier companies are charged for the downloading habits of their consumers. According to the researchers the Internet providers should be aware of the impact BitTorrent has on them, as it may greatly impact their business decisions.

The fact that ‘local’ BitTorrent traffic is preferable is not a new idea. Attempts to keep P2P transfers within the local network as much as possible are not new, and some ISPs have secretly tested the concept in the wild by seeding their own BitTorrent downloads.

As a closing remark we have to note that the study only looked at bandwidth, and not the various other costs BitTorrent traffic has on a network by making millions of connections every day. The takeaway message, however, is that in terms of revenue there are quite a few very large companies that profit directly from heavy BitTorrent users. That’s a conclusion we haven’t heard before.

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  • Jeff Bekcer

    And once again, Captain Obvious saves the day.

    • Anonymous

      An Uncyclopedia reader, eh?

  • Anonymous

    Now maybe the ISP’s won’t be bitches because they see there making money off of us…

    • Guest

      How are they making money again? The article didn’t really say — “transit charges” is a little vague. The revenue source is the users’ monthly internet bill? And heavy torrenters pay more each month? Does this compare the amount of profit they make from torrent users to regular users? As far as I know the upload traffic is what costs ISPs the most money, but it would be hard to study that.

      • http://otester.myopenid.com/ PiRat

        If torrent bandwidth isn’t costing them much, then they’ll allow more usage, more usage makes them a more attractive ISP for heavy downloaders, hence more customers, more money.

        It’s like C&W LLU resellers in the UK, virtually unlimited backhaul means they can offer customers 5.5TB usage per month making them very popular.

        • Guest

          Thanks for the explanation. It was the misleading title that confused me.

          It should be “Large ISPs Profit From BitTorrent USERS”.

      • Ruben

        Contrary to popular belief, supply and demand do exist when dealing with data. If you’re providing a service that lots of people want to use (for example, Facebook), you can charge ISPs for traffic to and from you. This is one of the uses of BGP.

        Bittorrent, being largely peer-to-peer, routes most traffic between ISPs (who are generally on the “consumer” side of the information, rather than Facebook on the “provider” side), meaning that ISPs generally don’t need to pay as much – if at all – for the traffic, saving them money.

        Of course, consumers generally don’t see this effect at all, and most ISPs don’t charge customers based on what links they’re using.

      • DocOc

        Yeah I have to say a quick scan of this article has left me completely in the dark. Can we have it re-written in very simple terms please…

        No hating on me because I like it simple you f***ers, like I got time in my day to decipher what some rabid, frothing 14 year old is spewing on the pages of the internet… I was sold on the premise implied in the article title, but am still in the dark…

        • http://tinyurl.com/ANoiXioNA-personal-info ANoiXioNA

          ok…

          Large isp’s …. ( HIGHER TIER )
          The ones that “own” large networks….the Infrastructure ( the wires between houses and some international trunks (wires) )
          They don’t have to pay …..when people share IN their network…..

          eg….. just like if you had two computers in you home…… Connected by a wire…
          It wouldn’t cost you anything to send data between the computers…..

          If you had to connect to a computer on the other side of the world…….
          Then that would be a different story…..
          You would have to pay the owners …of the wires you use……for the data you transfer.. More data = more cost…

          The study finds……

          Majority of bittorrent traffic is local….. so the people who own Local Infrastructure don’t pay for bandwidth for Local transfers…

          However…..

          Small isp’s…. ( LOWER TIER )
          They rent bandwidth and the infrastructure… from the ( HIGHER TIER )
          They pay more …..for more data being moved around….

          so….

          read the study again……. It does make sense…..
          It’s about the relativity of……

          small isp (Cost of bittorrent ) ….. VERSUS ….. Large isp (Cost of bittorrent)

        • http://tinyurl.com/ANoiXioNA-personal-info ANoiXioNA

          ok…

          Large isp’s …. ( HIGHER TIER )
          The ones that “own” large networks….the Infrastructure ( the wires between houses and some international trunks (wires) )
          They don’t have to pay …..when people share IN their network…..

          eg….. just like if you had two computers in you home…… Connected by a wire…
          It wouldn’t cost you anything to send data between the computers…..

          If you had to connect to a computer on the other side of the world…….
          Then that would be a different story…..
          You would have to pay the owners …of the wires you use……for the data you transfer.. More data = more cost…

          The study finds……

          Majority of bittorrent traffic is local….. so the people who own Local Infrastructure don’t pay for bandwidth for Local transfers…

          However…..

          Small isp’s…. ( LOWER TIER )
          They rent bandwidth and the infrastructure… from the ( HIGHER TIER )
          They pay more …..for more data being moved around….

          so….

          read the study again……. It does make sense…..
          It’s about the relativity of……

          small isp (Cost of bittorrent ) ….. VERSUS ….. Large isp (Cost of bittorrent)

    • Guest

      How are they making money again? The article didn’t really say — “transit charges” is a little vague. The revenue source is the users’ monthly internet bill? And heavy torrenters pay more each month? Does this compare the amount of profit they make from torrent users to regular users? As far as I know the upload traffic is what costs ISPs the most money, but it would be hard to study that.

  • Momo

    Well, duh.

    Also, who pays for the fastest connections they can afford? Newsflash: it’s not the grandmas!

    But, the benefit is increasingly being lost as the anti-pirates force more and more people to go underground and use VPNs/proxies/Tor. In that case, a lot if not all of the P2P traffic needs to be sent outside the country.

    The ISPs (read: the new content distributors) are idiots for passively allowing the anti-pirates (read: the old content distributors) to have their way. But, that’s another “well, duh” right there.

    • Lynx

      Not only that, but when your VPN connection to another country is slow, you opt to drop your $70/mo plan to a $30/mo plan because it is at the speed of your VPN. Now they really lose money.

      • Accidental Pirate

        get vpn…download less???
        lol
        vpn+unlimitited data plan = winrar!!

      • KarinaHJackson

        get a different vpn duh!

  • Anonymous

    Thepiratebay.org

    The white man’s alternative to looting HMV.

    I’ll just leave that there.

    • Ahoy

      Winner!!

    • Ahoy

      Winner!!

    • Jesus TittyFucking Christ

      What a knob, he actually thinks he’s funny.
      Racist tosser.

    • Jesus TittyFucking Christ

      What a knob, he actually thinks he’s funny.
      Racist tosser.

    • DocGerbil100

      Flagged for being completely off-topic, entirely unfunny and tediously offensive.

  • Herbert

    perhaps they will be less willing to be the entertainment industries bitches and get their own customers kicked off the internet. doing so will impact their profits and they wont want that!
    however, i suppose the other side of the coin is that the entertainment industries will now want the various ISPs that are profiting from torrent users to pay them.

  • Bruce Almighty

    This should come as obvious. Because file sharers are the ones who pay for the most high speed expensive packages. Your average Joe who only uses the internet for checking emails can even do with a dial up connection.

  • Guest

    The people selling internet access make money by selling internet access?! Tubular, dude!

  • Anonymous

    tinyurl.com/2df4ccp

  • Anonymous

    tinyurl.com/2df4ccp

  • Some@one.net

    Weird, my experience is the opposite: most traffic travels accross the Atlantic. Annoying, I’d love to get more (hyper)local connections. Is P4P still alive?

    • Some@one.net

      Talking about popular swarms, with many European peers here.

  • Hnmurugan

    The increasing trend in using VPN services for torrent downloads may affect the conclusion as the traffic does not stay local any longer……..

    • Danny

      There are no reasons to use VPNs. People on here always seem to be promoting them (possibly affiliated).

      I you use a decent tracker and have a peer blocker you are pretty safe. All the law suits appear to be made against children or pensioners who don’t have a clue!
      At the end of the day you aren’t doing anything wrong, the maffiaa should just suck it!

      • VPN fanboy

        Using a VPN is much safer.

  • Pilate

    have to state what was mentioned earlier.
    how are they making the money from it?
    granted beyond the obvious, again previously stated, i d/l a lot, so i’ve the highest/fastest package available, which costs more.
    is it _making_ them money or _saving_ them money?
    bit more details on that would be nice imho. could be useful to know info………

    • http://twitter.com/icanhazsake Ninja

      Avoided costs count as profit. If your traffic stays within your local network so you don’t need to pay for interconnection costs then it’s good. If your heavy downloaders are also the users that pay for bigger speeds then it’s definitely win.

    • http://twitter.com/icanhazsake Ninja

      Avoided costs count as profit. If your traffic stays within your local network so you don’t need to pay for interconnection costs then it’s good. If your heavy downloaders are also the users that pay for bigger speeds then it’s definitely win.

      • Pilate

        yea i understand and agree on that. just curious if that is what they are saying is how they are _making_ money on it.
        i’m just curious if it is that what they mean or if there is something else in there that we’re not aware of/not mentioned.

      • Pilate

        yea i understand and agree on that. just curious if that is what they are saying is how they are _making_ money on it.
        i’m just curious if it is that what they mean or if there is something else in there that we’re not aware of/not mentioned.

      • Danny

        Traffic costs are negligible, the servers and routers are on regardless of load, the extra traffic adds maybe 5% to power consumption, but these are expected costs. They make money by enticing people who want extra bandwidth, if I couldn’t download over bittorrent I wouldn’t buy over a 5Mb connection as you can comfortably stream HD at that bit-rate. Whats the point in super fast broadband if you cannot utilise it?

        • guenthar martin

          Many people share their internet access. We have 12 Mb DSL and 5 people are on it and we really need a much better speed (can’t afford it right now) so there are people that need super fast broadband.

        • guenthar martin

          Many people share their internet access. We have 12 Mb DSL and 5 people are on it and we really need a much better speed (can’t afford it right now) so there are people that need super fast broadband.

  • Alexei_123

    Same comment. The title is misleading. From what I understand, users pay their ISPs, which then transfer some money to other ISPs? The only way money comes into this system is from the users. So yes, maybe higher data plans cost more, but their price is usually not much higher than the unlimited data plans which were the standard as high-speed internet made its appearance. Overall, I think ISPs are at loss due to P2P file-sharing.

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  • Anonymous

    That actually does make a lot of sense when you think about it.
    total-anon.at.tc

  • Okarin

    i see this as leveling the playing field, the mpaa/riaa will still get their way with the isp’s because then the isp’s can make money both ways, until the mpaa/riaa stands a chance of winning then they’ll start to think about things because there is no allegiance to these people other then the shareholders. and the story about mpaa lobbying against wall street makes more sense, because wall street doesn’t care about piracy as long as they can make money of it.

  • http://profiles.google.com/ameergittens Ameer Gittens

    Never would have guessed that.

  • youngprod808

    If ISP’s would use usenet servers on their network, it would solve the majority of their bandwidth cost problems..

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  • MD3

    That’s why I keep saying: The copyright trolls should just agree to put a reasonable levy on ISP subscription and shut the f… up once and for all.

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  • JV7

    Would be nice if the article could give some kind of insight to how much money the ISP’s may or may not be making.

    Side note,I find it quite concerning that some people commenting here seem to think that they are being cheated by ‘anti-pirates’ trying to protect the content that people have createively and financialy invested in. The rationalisations as to why piracy/stealing should be acceptable are idiotic. Ignorence is not innocence. If you download or distribute illegally you are a criminal. But you know what they say.. ‘Never argue with an idiot because you will never win’.

    Good day :D

    • IDIOCRACY

      In holland if you pee against a tree you are a criminal… duh

    • http://twitter.com/icanhazsake Ninja

      I give you 2.73/10 for your trolling. Round it up to 3 due to your comedy-style randomness.

    • http://twitter.com/icanhazsake Ninja

      I give you 2.73/10 for your trolling. Round it up to 3 due to your comedy-style randomness.

    • Anonymous

      Actually, depending on where you live you are NOT a criminal. Because file sharing is considered perfectly legal in some countries. Oh and it’s copyright infringement, not stealing. U.S. courts have made the distinction, perhaps it’s time for some of the regular folk to acknowledge that distinction. You can’t be for law and order and justice and whatnot and then ignore actual rulings on the matter just to continue on some kind of diatribe against file sharers in order to call them thieves and whatnot.

      Also, while some of the rationalizations given as to why file sharing (or copyright infringement, if you want to part PROPER hairs) should be acceptable are idiotic, some are not. (And before you or some other person comes along and says I’m condoning and approving of file sharing, let me be clear that I am not. But I am stopping and thinking about it and seeing some valid reasons for doing it on the part of those who do and understand why they do what they want. Of course these may not be all the reasons why some do it, but it’s a nice sampling of legitimate reasons why it’s understandable that they do it.) Some content CANNOT be obtained by legal means for starters. As in, certain shows and movies are made and then never released through legitimate means (i.e. on dvd/blu-ray). Thus, people who want to purchase them cannot, and as such resort to obtaining the unreleased material through whatever means they can. That’s a problem they (the file sharers) are not responsible for and have no control over. Content providers are losing out on potential sales just because they don’t want to release something. Another possible reason for file sharing is released content in certain areas. Some people want certain things but are either denied access to them because of where they live or presented with radically altered versions of the product readily available to people elsewhere. (I.e. edited/altered versions of albums or movies or tv shows) Thus they’re essentially being cheated and given an inferior product, but still forced to pay the same as for the regular product. In that case, since they can’t acquire through local and legitimate retailers a copy of the original product, again, they resort to getting it through other means. Another possible reason is price. No, not the fact that something cost money. I mean actual price. As in sometimes in Country A a product might be say $15. In Country B however that same exact product (and I mean exactly the same in every possible way) might suddenly be $45. In cases like that, sometimes it’s cheaper to order something and pay the shipping and taxes on the $15 product than it is to just get the product locally. That is beyond ridiculous and practically inexcusable. If it’s the same product why does it cost several times more? I can’t think of any legitimate reasons (which isn’t to say there aren’t any, I just can’t think of any off the top of my head at the moment). I’m just gonna stop here, not because I can’t continue, but because this could go on for awhile. And I’d love to see how you readily discount any of these things out of hand, just because you don’t approve (as is made evident by your post in general).

      If you want to get into actions that are much worse than file sharing and are criminal (and if you partake in any of them YOU ARE A CRIMINAL, and for the most part have been committed at least once in a lifetime by every person on the planet) I’d be more than happy to entertain that line of thought. Jaywalking is a crime. And has the potential to be quite dangerous to oneself and others. A jaywalker could easily cross in an area of high traffic and potentially risk being hit by a car. Or force a driver to swerve to miss them and possibly hit another vehicle, potentially injuring and/or killing a completely innocent person. Speeding is a crime. Speeders could injure/kill themselves and others in addition to possibly causing property damage with their actions.

      Also, it’s worth pointing out that “ignorance is innocence” in some regards and situations. Children are ignorant and innocent. They’re children, they don’t know better in regards to a great many things. Are you saying they’re all bad just because they don’t know? What about the mentally handicapped? Or perhaps the elderly (who may be suffering from ailments that render them senile or what have you)? Or would you rather we lock them all up like hardened criminals and treat them just like everyone else just because they may be ignorant due to circumstances which you can’t quite fault them for?

      On a side note, perhaps you should proofread your comments before you click “Post”. I only mention that because I always see some comments calling people ignorant or idiots or something along those lines and then notice that the person saying things like that usually makes all kinds of mistakes in their comments. From either factually incorrect statements to bad grammar and spelling. “Ignorence is not innocence.” Kinda makes you look ignorant yourself, especially considering that “ignorence” is obviously underlined in red before I even post the comment, which should make it rather obvious that there’s something wrong with the spelling of the word. Ditto “createively” and “rationalisations”. It’s “ignorance” and “creatively” and “rationalizations”, not what you wrote.

      Your response to all this…? Or should I heed the last bit you wrote and realize that I shouldn’t argue with an idiot, because I’ll never win?

      Good day. : )

  • Dia

    I find it quite funny how many people think the way ISPs benefit from this is “obvious” while also being completely wrong :P

    The article was unclear and poorly written, but that’s no excuse.

    • IDIOCRACY

      “while also being completely wrong”
      care to explain, hehe

      • Dia

        ANoiXioNA explained it earlier.

        • IDIOCRACY

          And he was wrong so… still care to explain?

  • IDIOCRACY

    Besides this article, it was of coarse already very clear that the ISP earn money on their users duh. In Holland there was a time that ISP advertised with high download speeds and put their speeds in a chart and in the same chart the reason / purpose of the clients internet connection.
    Here in this comparison-chart was mentioned that for downloading movies you could be best off with their highest speed bundle 21Mbit and for downloading only music you could do with the 2nd fastest 8Mbit, for email and occasional browsing the 256Kbit connection was advised.
    NEED I SAY MORE????

    Note:
    So here the advertising of downloading (not uploading) is clear in conjunction with speed and therefore the price of the bundle.
    One could argue that the ISP were and are facilitating and promoting downloading illegal content by P2P. Because with P2P you can get speeds far beyond legal downloads and then (in those days… a few years ago) a 256Kbit connection would have been sufficient for these legal content downloads. :D And earning money is what the stakeholders want so…. The article is somewhat needless but … ok nice to see what we all already know in (vitual)print hehe

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  • Anonymous

    You don’t need more than a 1 Mbit connection if all you do is surf and email, maybe not even that.

    Yeah if you watch Flash movies. So you could save a lot of ducets if you didn’t download which means all ISP’s would lose ducets, hence all ISP at any level make ducets …

    In fact you could do quite a bit of downloading over a 1 Mbit link if you ran it 24/7 unless of course you are addicted to quick gratification.

  • lucky winner

    Hey i saw this “You are the 17,190,732,410th visitor” banner on the right of tf’s page! i think i’m going to claim my prize!

  • Scottshuster

    Don’t providers make more money when I opt for a service with a greater download speed?

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  • http://www.facebook.com/eric.boehm Jack Murdock

    So now we have proof that the ISPs have a vested interest in ensuring that piracy remains untouched. They are earning big bucks off artists.

    • JackMurdock

      So are the “suits” at the labels, who don’t actually create any music. They have a vested interest in ensuring that file sharing remains in check, otherwise they might have to get real jobs or actually create something of their own. You’re point being? See, I can spin something just as easily to suit my point of view. Surprised it took you so long to post that. In the words of Judge Dredd, “I knew you’d say that.” Was just a matter of time.

      Hi my name is Jack Murdock. I’m a bonebag (before anyone ask, it’s a combination of the words “bonehead” and “douchebag”). I like to say things that aren’t true, but I feel my masters that I don’t have (wink wink) would approve of. I like to repeat rhetoric without presenting any actual facts to support it. And I purposefully ignore any facts given by the RIAA/MPAA that actually refute the things they say (like their profit records for the last few years, which show they’re actually breaking each previous year’s profit records). I don’t have a girlfriend. Or a life. But I like to say others should get one. I also like to make illogical comparisons (like comparing file sharing to driving under the influence, as in, “let’s ignore all laws while we’re at it apparently”). I’m basically the definition of internet troll. Except I actually can’t even troll properly, because a troll just says things to get a reaction, I actually believe what I say. If anyone wants to pick on me feel free, I’ll only defend what I say if you seriously go off in pointing out the errors in what I say. Or if there are other “trolls” around, so I can feel like we’re the majority. What I’m trying to say is, if there is a “creator” to everything, he’d probably put a “KICK ME” sign on my back, and I’d deserve it. Thank you for reading a little bit about me. I appreciate the interest. On that note, I must bid you all adieu and may you have a great weekend.

  • Tidaltree

    Isn’t it time for a hardeware approach to decentralise internet usage, offering users and low-tier-isps better costcontrol at the same time? Shortwaves are reflected by the hemisphere, for example, thus building a set of routers for consumers and isps with a selfconnecting wlannetwork for shortlength connections and shortwave for connections worldwide sounds like an alternative to me. Ok… pingwise there won’t be gained anything here. But the speed of data travelling shortwaves could be enhanced through a spread through the wlannetwork, with isps beeing able to offer their services to speed up things on shorttermbasis, eg. hourly. (Although imho each router, even the one for endusers, should offer the possibility to share a part of a previously rented ispline.)

    Ok… eventually this idea won’t be viable without a third wavelength, which delivers a compromise between reach and speed inbetween wlan and shortwave.

    Tidaltree

    • Tidaltree

      Meant “[...] amount of data travelling shortwaves [...]“. Not “[...] speed of data [...]“.

  • Tidaltree

    Isn’t it time for a hardeware approach to decentralise internet usage, offering users and low-tier-isps better costcontrol at the same time? Shortwaves are reflected by the hemisphere, for example, thus building a set of routers for consumers and isps with a selfconnecting wlannetwork for shortlength connections and shortwave for connections worldwide sounds like an alternative to me. Ok… pingwise there won’t be gained anything here. But the speed of data travelling shortwaves could be enhanced through a spread through the wlannetwork, with isps beeing able to offer their services to speed up things on shorttermbasis, eg. hourly. (Although imho each router, even the one for endusers, should offer the possibility to share a part of a previously rented ispline.)

    Ok… eventually this idea won’t be viable without a third wavelength, which delivers a compromise between reach and speed inbetween wlan and shortwave.

    Tidaltree

  • Guest

    It’s not only the ISP but also the hdd manufacturer which are also making money out of piracy as one can imagine where could this huge amount of downloaded data would be stored.

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  • tony

    They do make money. I was using 700gb-1tb/monthly due to bittorrent and a few other things. I had to upgrade to business internet or else be disconnected for 6mos. I went from paying $60 for 25mb/3mb up to $170 for the same.

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