Level 3 Communications (www.level3.com) today unveiled a new pricing plan for its IP carrier customers that is analogous to long-distance voice pricing. Rather than offering flat-rate IP services, the company's new (3)CrossRoads is based on destination sensitive billing, which can result in savings of up to 50 percent for Internet companies, according to Level 3.
"We align our costs of delivering our services with our prices. It has nothing to do with whether it's our fiber or someone else's fiber. It has to do with where your traffic is going to or coming from," says David Samuels, Level 3's senior director of IP services.
Level 3 rates traffic based on where the user is located, how that customer interfaces with the Level 3 network, and how the customer wants to be billed. Then, if the customer wants usage-sensitive billing, Level 3 samples the customer's traffic for a month and decides whether the send or receive traffic is more plentiful. Whichever is greater Level 3 divides into what's on-net, what's off-net and what's intracity.
For example: If the customer has 10 megabits of off-net traffic, 4 megs on-net and 1-meg intracity, that customer pays a nominal port fee plus usage at the off-net rate times 10-megs, on-net rate times 4-megs and the intracity rate.
That's better than the flat-rate option in this case because the on-net rate is 20 percent to 25 percent lower than the off-net rate, and the intracity rate is 20 percent to 25 percent less than the on-net charge, Samuels says.
"But even our off-net rate is very aggressively priced," he adds.
The service is currently available in North America and there are plans to expand into Europe in September and into Asia by year's end.
NaviPath Inc. (www.navipath.com), a majority-owned operating company of CMGI Inc. headquartered in Andover, Mass., and Atlanta-based AmQUEST (www.amquest.com), an application infrastructure provider, are among Level 3's first (3)CrossRoads customers.
