Understanding Bandwidth and 95th Percentile Billing

When you partner with Datotel for cloud, colocation or managed hosting services, understanding how bandwidth works, and how it’s billed, helps you make smarter IT decisions. We believe transparency matters, so here’s a clear look at what bandwidth really means, how 95th percentile billing is calculated, and what factors can influence your costs.

What is Bandwidth?

Bandwidth is simply the amount of data that can move in and out of your network connection per second, measured in Mbps (megabits per second) or Gbps (gigabits per second).
Think of your network link like a highway:

• A wider highway (higher bandwidth) means more lanes for cars (data) to travel without getting bottlenecked.
• If many cars try to use the highway at once and the lanes are narrow, you’ll hit congestion (slower data transfers, delays).

At Datotel, we ensure the “highway” you get is sized appropriately for your business so your applications, users and backups run smoothly, even during busy times.

How Bandwidth Usage is Measured

We continuously monitor your bandwidth usage throughout the month, typically in short‐interval samples (e.g., every 5 minutes). That gives us thousands of data points showing how much traffic your systems are using, not just the average, but how often you spike, how long your peaks last, and how your pattern changes over time.

What Is 95th Percentile Billing?

Rather than billing you purely on average usage or punishing you for every spike, Datotel uses the 95th percentile billing model, which is common among data centers and network providers. Here’s how it works:

1. We take your bandwidth usage samples throughout the month.
2. Sort these samples from lowest to highest.
3. Discard the highest 5 % of samples (those very short, extreme spikes).
4. The next highest value (the 95th percentile point) is used to determine your “billable” bandwidth.

Why this method? Because it strikes a balance: it protects you from paying for one‐off data surges, while still aligning your bill with your sustained usage.

Why 95th Percentile Makes Sense

Here’s why we at Datotel prefer this model, and why our clients appreciate it too:

• Fairness: You’re not penalized for brief traffic spikes that are out of the ordinary.
• Clarity: Your bill reflects your sustained usage, not just a one-minute burst of traffic you didn’t plan for.
• Scalability: If your business grows and your traffic rises, your billing adjusts naturally with that growth.
• Encourages optimization: Because the highest 5 % of brief spikes are excluded, you’re motivated to look at overall traffic patterns, and that helps with performance tuning and budgeting.

What Impacts Your Bandwidth and Billing?

Let’s dig into what can make your 95th percentile number go up (or down). Being aware of these factors helps you stay in control, and not get surprised.

1. Traffic Patterns:
If your network has consistent heavy usage, large file transfers, streaming, backups, or heavy inbound/outbound content delivery, your “sustained” usage will be higher, which drives up the 95th percentile.

2. Application Behavior:
Certain services are bandwidth‐hungry. For example:

• Video streaming or video conferencing
• Large data backups or restores
• Content delivery to many clients
• Real-time data replication between sites

These all add to your usage footprint and can push your bill up.

3. Peak Periods and Duration:
Even if you have spikes, what matters is how long they last and how often they occur. If your application has many long high-traffic windows (say daily synchronizations, peak customer usage hours, or file distributions), those become part of the “normal” usage curve, even if your average looks OK.

4. Network Architecture & Optimization:
You have tools and strategies that can reduce your effective bandwidth usage:

• Caching content so you aren’t re-sending the same data externally
• Using CDNs (Content Delivery Networks) for high‐volume public content
• Compressing data, optimizing transfers, scheduling large transfers during off‐peak periods
• Reviewing and pruning unnecessary traffic flows

At Datotel, we help you analyze your usage and apply these optimizations so you don’t over-pay for the bandwidth you don’t really need.

How Datotel Supports You

We don’t just measure your usage, we partner with you to understand and manage it:

• We provide detailed reports showing your bandwidth usage trends, where your peaks are, and how often you’re hitting critical points.
• We offer recommendations on how to optimize your traffic and network design.
• We help you plan ahead for growth, so you won’t be suddenly hit with a big jump in your bill because usage grew without a plan.
• We keep everything transparent, so you know exactly what you’re paying for and why.

In Summary

Bandwidth is one of the key elements of your IT infrastructure. The 95th percentile billing method ensures you’re paying for sustained, real‐world usage, not fleeting bursts. With Datotel, you get the visibility, expertise, and tools to manage your network efficiently, keep costs predictable, and scale when you’re ready.

Contact Datotel today to learn how our team can help you understand and manage bandwidth more effectively.