All, Richard Laager from Wikstrom Telephone and I have put together a spreadsheet (see link below) detailing the cost breakdown and potential fee structures for MICE. I've highlighted the input fields in orange (you're welcome Mike H) and would encourage you to review the values and assumptions annotated within the sheet. MICE Cost Breakdown, Oct 2012.xlsx <http://db.tt/aJCZNXGz> This spreadsheet proposes fees based on the current costs of the exchange. While slightly simplistic (e.g. no effort was made to account for inflation), this seemed like a reasonable and mostly-objective path to calculating the first year of fees. These costs assume that labor is still donated. The space and power costs are included, even though they're currently donated for 3 years; the effect of this will be to build up reserves. These reserves would be to allow for unforeseen events as well as growth (e.g. adding another switch if we run out of ports). The hardware costs of the existing switches are included as well, even though the switches are already paid for. This will build up funding to buy the next generation of switches (40G or 100G). Yearly, the Board of Governors ("steering committee") needs to update (or review the work of a committee which has updated) the inputs to cost projections. After this first year, since the "expected life" will be one year less, the hardware purchase costs will need to be updated to account for costs already recovered. For example, pretend we had only one switch that cost $10,000, support costs $1,000/year, and we expect to install then next generation switch in 5 years. The methods used in the spreadsheet would show we need to recover: 10000 / 5 + 1000 = $3000/year. Next year, if we are still exactly on, the fees don't change. Since we recovered $2,000 in the first year, we now need to recover: 8000 / 4 + 1000 = $3000/year. As the best estimates (for the cost of the next generation of switch and the remaining time until such a switch is necessary) are updated, the costs will go up or down. Additionally, Richard and I discussed some policy notes and considerations and wanted to include the following for your review and comment as well. *POLICY PROPOSALS:* *General * The term "Resources" refers to physical or logical resources such as IP addresses, ports, etc. In the 4th quarter, the rates for Resources for the upcoming year shall be fixed by the Board of Governors. The new rates shall take effect on January 1. Future policy action may define a Grace Period (e.g. for new members) during which fees are waived. This Grace Period is separate from, and in addition to, the "one month" references below. *Prorating * Annual rates shall be prorated by months only. Resources connected on or before the 15th of a month shall be billed effective the 1st of that month. Resources connected after the 15th shall be billed effective the 1st of the next month. No refunds shall be given for disconnections. Credit is only given during migrations, as provided below. *Migrations * Additional resources utilized during MICE-initiated migrations are not billable provided the member complies with MICE's timetable for that migration. Members upgrading (not downgrading) the type (speed) of their ports (e.g. one or more 1G ports to one or more 10G ports) shall be prorated the difference between the port costs. If the difference is negative, the credit may be carried forward up to one year. During the period of overlap between the sets of ports, one month's overlap of the cheaper set shall be credited; if there is less than one month of overlap, no overlapping charges apply. *IPs * Upon application, a new member shall be assigned one set of one IPv4 address and one IPv6 address. The IPs are billable one month after the route servers are configured (unless the member opts out of multi-lateral peering) and the member is notified of the assignment. Additional IPv4 and IPv6 addresse sets are billable at the same rate as the first set. Members may not be assigned more than two sets of addresses without future policy action. *Ports * Ports are billable once configured and the member is notified of the assignment, except that ports assigned to new members are billable one month later. *Transceivers * Transceivers (SFP, SFP+, etc.), when required for ports, must be purchased from MICE or provided by the member. If purchased from MICE, no Grace Period applies. If provided, the transceiver must meet MICE's requirements, which may include a manufacturer or manufacturer compatibility specification for switch support reasons. Transceivers (once paid for) remain the property of the member. Feel free to play around with the numbers and understand the cost breakdowns for yourself. Let us know if you have questions regarding the sheet or the included calculations/assumptions. Thanks! s *Shaun Carlson *Senior Network Engineer | Arvig ph: (218) 346-8673 | contact: protocol.by/scarlson em: shaun.carlson@arvig.com ######################################################################## To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1
On Fri, Oct 05, 2012 at 11:22:07AM -0500, Shaun Carlson wrote:
Richard Laager from Wikstrom Telephone and I have put together a spreadsheet (see link below) detailing the cost breakdown and potential fee structures for MICE. I've highlighted the input fields in orange (you're welcome Mike H) and would encourage you to review the values and assumptions annotated within the sheet.
I am so excited. Thanks you two! (and for the orange) -- Mike Horwath ipHouse - Welcome home! drechsau@iphouse.net The universe is an island, surrounded by whatever it is that surrounds universes. - Berkeley Fortune ######################################################################## To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1
Shaun and Richard, I like and appreciate the work and thought that you guys have put into this. The only comment I have is regarding the acquisition of new members. Since MICE is still relatively young, I'd encourage us to look at ways to make it easy for companies to come on board. Can we extend the life expectancy of hardware from 3 years to 5 or 6 years? The switches really should live much longer than 3 years in the way we are using them. And one question: A significant portion of the annual cost is related to the Base Member Fee, and a large portion of that is associated with the Cologix-donated space and power fees that are currently forgiven. I agree with the notion that charging members for those otherwise forgiven fees is a good way to build cash reserves without asking for more donations. Is $11K annual a reasonable number for a MICE bank account? Thank you, Dean Dean Bahls Network Services Manager Cooperative Network Services, LLC (218) 346-3635 (office) dean.bahls@cooperative-networks.com From: MICE Discuss [mailto:MICE-DISCUSS@LISTS.IPHOUSE.NET] On Behalf Of Shaun Carlson Sent: Friday, October 05, 2012 11:22 AM To: MICE-DISCUSS@LISTS.IPHOUSE.NET Subject: [MICE-DISCUSS] New cost breakdown worksheet All, Richard Laager from Wikstrom Telephone and I have put together a spreadsheet (see link below) detailing the cost breakdown and potential fee structures for MICE. I've highlighted the input fields in orange (you're welcome Mike H) and would encourage you to review the values and assumptions annotated within the sheet. MICE Cost Breakdown, Oct 2012.xlsx <http://db.tt/aJCZNXGz> This spreadsheet proposes fees based on the current costs of the exchange. While slightly simplistic (e.g. no effort was made to account for inflation), this seemed like a reasonable and mostly-objective path to calculating the first year of fees. These costs assume that labor is still donated. The space and power costs are included, even though they're currently donated for 3 years; the effect of this will be to build up reserves. These reserves would be to allow for unforeseen events as well as growth (e.g. adding another switch if we run out of ports). The hardware costs of the existing switches are included as well, even though the switches are already paid for. This will build up funding to buy the next generation of switches (40G or 100G). Yearly, the Board of Governors ("steering committee") needs to update (or review the work of a committee which has updated) the inputs to cost projections. After this first year, since the "expected life" will be one year less, the hardware purchase costs will need to be updated to account for costs already recovered. For example, pretend we had only one switch that cost $10,000, support costs $1,000/year, and we expect to install then next generation switch in 5 years. The methods used in the spreadsheet would show we need to recover: 10000 / 5 + 1000 = $3000/year. Next year, if we are still exactly on, the fees don't change. Since we recovered $2,000 in the first year, we now need to recover: 8000 / 4 + 1000 = $3000/year. As the best estimates (for the cost of the next generation of switch and the remaining time until such a switch is necessary) are updated, the costs will go up or down. Additionally, Richard and I discussed some policy notes and considerations and wanted to include the following for your review and comment as well. POLICY PROPOSALS: General The term "Resources" refers to physical or logical resources such as IP addresses, ports, etc. In the 4th quarter, the rates for Resources for the upcoming year shall be fixed by the Board of Governors. The new rates shall take effect on January 1. Future policy action may define a Grace Period (e.g. for new members) during which fees are waived. This Grace Period is separate from, and in addition to, the "one month" references below. Prorating Annual rates shall be prorated by months only. Resources connected on or before the 15th of a month shall be billed effective the 1st of that month. Resources connected after the 15th shall be billed effective the 1st of the next month. No refunds shall be given for disconnections. Credit is only given during migrations, as provided below. Migrations Additional resources utilized during MICE-initiated migrations are not billable provided the member complies with MICE's timetable for that migration. Members upgrading (not downgrading) the type (speed) of their ports (e.g. one or more 1G ports to one or more 10G ports) shall be prorated the difference between the port costs. If the difference is negative, the credit may be carried forward up to one year. During the period of overlap between the sets of ports, one month's overlap of the cheaper set shall be credited; if there is less than one month of overlap, no overlapping charges apply. IPs Upon application, a new member shall be assigned one set of one IPv4 address and one IPv6 address. The IPs are billable one month after the route servers are configured (unless the member opts out of multi-lateral peering) and the member is notified of the assignment. Additional IPv4 and IPv6 addresse sets are billable at the same rate as the first set. Members may not be assigned more than two sets of addresses without future policy action. Ports Ports are billable once configured and the member is notified of the assignment, except that ports assigned to new members are billable one month later. Transceivers Transceivers (SFP, SFP+, etc.), when required for ports, must be purchased from MICE or provided by the member. If purchased from MICE, no Grace Period applies. If provided, the transceiver must meet MICE's requirements, which may include a manufacturer or manufacturer compatibility specification for switch support reasons. Transceivers (once paid for) remain the property of the member. Feel free to play around with the numbers and understand the cost breakdowns for yourself. Let us know if you have questions regarding the sheet or the included calculations/assumptions. Thanks! s Shaun Carlson Senior Network Engineer | Arvig ph: (218) 346-8673 | contact: <http://protocol.by/scarlson> protocol.by/scarlson em: <mailto:shaun.carlson@arvig.com> shaun.carlson@arvig.com _____ To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS <http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1> &A=1 ######################################################################## To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1
Dean, those are great observations and questions. This sheet really isn't a recommendation at this stage so much as its a way to understand our costs, or potential costs, and decide how we want to move forward. I also think another key question was raised at the meeting on Wednesday about where we're headed as a group. I.e. long term goals and strategies. The answer to that question is just as important to determining our fee structure and method of financing. s // SIGNED // Shaun Carlson --------------- Please excuse my grammar and typos, this was sent from my mobile device. On Oct 5, 2012, at 13:50, Dean Bahls <dean.bahls@COOPERATIVE-NETWORKS.COM> wrote:
Shaun and Richard,
I like and appreciate the work and thought that you guys have put into this.
The only comment I have is regarding the acquisition of new members. Since MICE is still relatively young, I’d encourage us to look at ways to make it easy for companies to come on board. Can we extend the life expectancy of hardware from 3 years to 5 or 6 years? The switches really should live much longer than 3 years in the way we are using them.
And one question: A significant portion of the annual cost is related to the Base Member Fee, and a large portion of that is associated with the Cologix-donated space and power fees that are currently forgiven. I agree with the notion that charging members for those otherwise forgiven fees is a good way to build cash reserves without asking for more donations. Is $11K annual a reasonable number for a MICE bank account?
Thank you,
Dean
Dean Bahls Network Services Manager Cooperative Network Services, LLC (218) 346-3635 (office) dean.bahls@cooperative-networks.com
From: MICE Discuss [mailto:MICE-DISCUSS@LISTS.IPHOUSE.NET] On Behalf Of Shaun Carlson Sent: Friday, October 05, 2012 11:22 AM To: MICE-DISCUSS@LISTS.IPHOUSE.NET Subject: [MICE-DISCUSS] New cost breakdown worksheet
All,
Richard Laager from Wikstrom Telephone and I have put together a spreadsheet (see link below) detailing the cost breakdown and potential fee structures for MICE. I've highlighted the input fields in orange (you're welcome Mike H) and would encourage you to review the values and assumptions annotated within the sheet.
MICE Cost Breakdown, Oct 2012.xlsx
This spreadsheet proposes fees based on the current costs of the exchange. While slightly simplistic (e.g. no effort was made to account for inflation), this seemed like a reasonable and mostly-objective path to calculating the first year of fees. These costs assume that labor is still donated. The space and power costs are included, even though they're currently donated for 3 years; the effect of this will be to build up reserves. These reserves would be to allow for unforeseen events as well as growth (e.g. adding another switch if we run out of ports). The hardware costs of the existing switches are included as well, even though the switches are already paid for. This will build up funding to buy the next generation of switches (40G or 100G).
Yearly, the Board of Governors ("steering committee") needs to update (or review the work of a committee which has updated) the inputs to cost projections. After this first year, since the "expected life" will be one year less, the hardware purchase costs will need to be updated to account for costs already recovered. For example, pretend we had only one switch that cost $10,000, support costs $1,000/year, and we expect to install then next generation switch in 5 years. The methods used in the spreadsheet would show we need to recover: 10000 / 5 + 1000 = $3000/year. Next year, if we are still exactly on, the fees don't change. Since we recovered $2,000 in the first year, we now need to recover: 8000 / 4 + 1000 = $3000/year. As the best estimates (for the cost of the next generation of switch and the remaining time until such a switch is necessary) are updated, the costs will go up or down.
Additionally, Richard and I discussed some policy notes and considerations and wanted to include the following for your review and comment as well.
POLICY PROPOSALS:
General
The term "Resources" refers to physical or logical resources such as IP addresses, ports, etc.
In the 4th quarter, the rates for Resources for the upcoming year shall be fixed by the Board of Governors. The new rates shall take effect on January 1.
Future policy action may define a Grace Period (e.g. for new members) during which fees are waived. This Grace Period is separate from, and in addition to, the "one month" references below.
Prorating
Annual rates shall be prorated by months only. Resources connected on or before the 15th of a month shall be billed effective the 1st of that month. Resources connected after the 15th shall be billed effective the 1st of the next month. No refunds shall be given for disconnections. Credit is only given during migrations, as provided below.
Migrations
Additional resources utilized during MICE-initiated migrations are not billable provided the member complies with MICE's timetable for that migration.
Members upgrading (not downgrading) the type (speed) of their ports (e.g. one or more 1G ports to one or more 10G ports) shall be prorated the difference between the port costs. If the difference is negative, the credit may be carried forward up to one year. During the period of overlap between the sets of ports, one month's overlap of the cheaper set shall be credited; if there is less than one month of overlap, no overlapping charges apply.
IPs
Upon application, a new member shall be assigned one set of one IPv4 address and one IPv6 address. The IPs are billable one month after the route servers are configured (unless the member opts out of multi-lateral peering) and the member is notified of the assignment.
Additional IPv4 and IPv6 addresse sets are billable at the same rate as the first set. Members may not be assigned more than two sets of addresses without future policy action.
Ports
Ports are billable once configured and the member is notified of the assignment, except that ports assigned to new members are billable one month later.
Transceivers
Transceivers (SFP, SFP+, etc.), when required for ports, must be purchased from MICE or provided by the member. If purchased from MICE, no Grace Period applies. If provided, the transceiver must meet MICE's requirements, which may include a manufacturer or manufacturer compatibility specification for switch support reasons. Transceivers (once paid for) remain the property of the member.
Feel free to play around with the numbers and understand the cost breakdowns for yourself. Let us know if you have questions regarding the sheet or the included calculations/assumptions.
Thanks!
s
Shaun Carlson Senior Network Engineer | Arvig ph: (218) 346-8673 | contact: protocol.by/scarlson em: shaun.carlson@arvig.com
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On Fri, Oct 05, 2012 at 01:50:26PM -0500, Dean Bahls wrote:
The only comment I have is regarding the acquisition of new members. Since MICE is still relatively young, I'd encourage us to look at ways to make it easy for companies to come on board. Can we extend the life expectancy of hardware from 3 years to 5 or 6 years? The switches really should live much longer than 3 years in the way we are using them.
Extending the life won't give enough revenue to buy another set of switches. So extending the life would not really change the fee structure much.
And one question: A significant portion of the annual cost is related to the Base Member Fee, and a large portion of that is associated with the Cologix-donated space and power fees that are currently forgiven. I agree with the notion that charging members for those otherwise forgiven fees is a good way to build cash reserves without asking for more donations.
MICE can't survive on donations.
Is $11K annual a reasonable number for a MICE bank account?
In my opinion: yes. -- Mike Horwath ipHouse - Welcome home! drechsau@iphouse.net The universe is an island, surrounded by whatever it is that surrounds universes. - Berkeley Fortune ######################################################################## To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1
11k MAY be a bit too low. I would like to see us have about 15k a year, as that will give us some money for sending out techs (which we do NOT get for free from Cologix) in case of failures, and also replacing things that break when you least expect it. Reid On Fri, Oct 5, 2012 at 3:07 PM, Mike Horwath <drechsau@iphouse.net> wrote:
On Fri, Oct 05, 2012 at 01:50:26PM -0500, Dean Bahls wrote:
The only comment I have is regarding the acquisition of new members. Since MICE is still relatively young, I'd encourage us to look at ways to make it easy for companies to come on board. Can we extend the life expectancy of hardware from 3 years to 5 or 6 years? The switches really should live much longer than 3 years in the way we are using them.
Extending the life won't give enough revenue to buy another set of switches.
So extending the life would not really change the fee structure much.
And one question: A significant portion of the annual cost is related to the Base Member Fee, and a large portion of that is associated with the Cologix-donated space and power fees that are currently forgiven. I agree with the notion that charging members for those otherwise forgiven fees is a good way to build cash reserves without asking for more donations.
MICE can't survive on donations.
Is $11K annual a reasonable number for a MICE bank account?
In my opinion: yes.
-- Mike Horwath ipHouse - Welcome home! drechsau@iphouse.net The universe is an island, surrounded by whatever it is that surrounds universes. - Berkeley Fortune
########################################################################
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-- Reid Fishler Director Hurricane Electric +1-510-580-4178 ######################################################################## To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1
On Fri, 2012-10-05 at 13:50 -0500, Dean Bahls wrote:
The switches really should live much longer than 3 years in the way we are using them.
We're using our current costs as a way to estimate future costs. In other words, we're not saying that we need to buy another 40-port 10G switch in 3 years. We're saying we need to buy an X-port 40G or 100G switch in 3 years, and by then, it'll probably cost about what the 10G switch cost us this time. I realize this isn't perfectly accurate, but at this point, I like the fact that it's closer to objective than subjective. I'd hate to see us get bogged down discussing what each of us predicts a 40G switch will cost 3 years from now. -- Richard ######################################################################## To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1
On Oct 5, 2012, at 11:50 AM, Dean Bahls <dean.bahls@COOPERATIVE-NETWORKS.COM> wrote:
Shaun and Richard,
I like and appreciate the work and thought that you guys have put into this.
The only comment I have is regarding the acquisition of new members. Since MICE is still relatively young, I’d encourage us to look at ways to make it easy for companies to come on board. Can we extend the life expectancy of hardware from 3 years to 5 or 6 years? The switches really should live much longer than 3 years in the way we are using them.
And one question: A significant portion of the annual cost is related to the Base Member Fee, and a large portion of that is associated with the Cologix-donated space and power fees that are currently forgiven. I agree with the notion that charging members for those otherwise forgiven fees is a good way to build cash reserves without asking for more donations. Is $11K annual a reasonable number for a MICE bank account?
It might be a little on the low side, but I think it's as good a starting point as any. Owen ######################################################################## To unsubscribe from the MICE-DISCUSS list, click the following link: http://lists.iphouse.net/cgi-bin/wa?SUBED1=MICE-DISCUSS&A=1
participants (6)
-
Dean Bahls -
Mike Horwath -
Owen DeLong -
Reid Fishler -
Richard Laager -
Shaun Carlson