How to understand 95 Percentile Bandwidth Billing Model

95 percentile billing is one of the methods we use to meter bandwidth for dedicated servers. Your port speed isn’t capped, and you have the ability to spike your usage for brief periods of time without overpaying for traffic.

95 percentile method is an industry standard way hosting providers can bill for bandwidth. It’s generally not as popular as the fixed bandwidth and unmetered methods though.

It’s more common to see colocation providers offer 95 percentile billing. Nonetheless, for dedicated server customers, there are many advantages to this method of bandwidth!

You can receive unexpected traffic spikes (up to 5% of traffic) without being hit with an unexpectedly large bandwidth bill. You can therefore more easily estimate your average bandwidth needs and usage.

In this post, we’re going to discuss the 95 percentile method, as well as the more popular alternatives like fixed-traffic, and unmetered ports.

All of our dedicated servers come with the choice of 95 percentile bandwidth billing.

How does 95% bandwidth work?

Bandwidth is not calculated real-time, but polled and logged at a sampling interval every 5 minutes. At the end of the billing cycle, the monthly log is sorted from lowest to highest (ascending order).

But rather than calculate usage on all entries, the largest 5% of use is ignored.

Data Points: (60 minutes * 24 hours * 30 days ) / 5 minute intervals = 8640 data points

Out of all those data points, the top 5% (432 data points – or 2160 minutes, or 36 hours) are ignored. On average, you have about 1.5 days worth of unforeseen overage that is forgiven!

This allows you to not fret or worry simply because your business is succeeding. For example, traffic from news coverage, due to sites like CNN or Reddit.

Why is 95% bandwidth preferred?

The 95th percentile model is easily the fairest method to calculate bandwidth. By only calculating the bottom 95% of usage, you’re not penalized for rounding errors in calculations, nor for reasonable traffic spikes.

It also allows us to keep costs lower, as we’re not wasting time and funds on monitoring tools and issuing heavy-handed infractions for overuse.

For newbies, understanding 95 percentile bandwidth use may take a month or two (1-2 billing cycles), as they have likely never measured their use on a VPS or shared hosting plan.

There is a learning curve, albeit a very small one.

Advantages of 95% Model:

  • No fixed bandwidth cap
  • Your visitors are never presented with a “Bandwidth Exceeded” notice in their browsers
  • No wasted funds; by not forcing included bandwidth, you only pay for what you use
  • No exorbitant overage fees

Alternative Billing Methods

Fixed-Quota Bandwidth Model

Easy for newbies to understand, as it’s similar to shared and VPS hosting bandwidth calculation. Traditionally, hosting providers allocate bandwidth based on the hosting plan. 

For example, dedicated server plan B gets 1TB of monthly transfer. Then if you exceed that 1TB, you’re often hit with an enormous (or ridiculous) overage bill.

The cost of the initial bandwidth is integrated into the price of the dedicated server plan, and you may be paying for bandwidth that’s not needed. Inversely, if you do exceed the allotment, you’re usually charged a huge unreasonable sum for the overage. It’s just not a fair method, even if easier to understand.

Maximum Port Speed

This method is also easy for newbies to understand. This is often known as the  “unlimited” method – and it’s not at all unlimited.  When the slow port speed is exceeded, the server simply becomes unresponsive or slow. And that can significantly damage your business and reputation.

Most “unlimited” offers of bandwidth are from low-end dubious providers.

Even when 1 Gbps or 100 Mbps port speeds are advertised, the reality is that speeds are much slower due to network considerations. For example, placing too many servers on a switch. The slowest bottleneck determines speed!

EuroVPS, quality bandwidth, and you!

95th percentile billing model aims to find a middle ground between scalability, volatility and cost. It gives you the flexibility to pay for the bandwidth that you regularly use – while still having the ability to carelessly spike when necessary.

The “averaging” approach to billing usage makes this a much less volatile billing, and does not suffer from the shenanigans of “unlimited”.

To leverage the benefits of 95th percentile billing model, opt for any of our  Europe based dedicated server plans at EuroVPS.