How is Ethernet IP Delivered

From Bandipedia

Ethernet as an Internet Access service becomes available when an ISP places its own router in the building being serviced and backhauls a local access loop to its network edge. In doing so, it is actually extending the edge of its network into the building. Once the ISP has a presence in the building, it can offer Internet access simply by connecting an Ethernet cable from the router directly into a suite of a paying subscriber. In this scenario, most ISP’s will offer large throughput speeds, such as 10 Mbps, for half the cost of a traditional T1. The business model used to achieve the low cost and high speed offer is one of over-subscription. True, the ISP may bring in a carrier-grade circuit, such as a DS-3 with 45 Mbps of throughput, but upon the fifth subscriber of a 10 Mbps Ethernet, the router is officially over-subscribed. The ISP counts on traditional subscription ratios that are based on the fact that not every subscriber will be accessing the full throughput at the same time. Using this theory, the ISP will seek to sign up as many subscribers as possible in order to offset the cost of the local access loop for which they pay a monthly recurring charge to the LEC, and any CAPEX for the router and other equipment deployed.

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