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Usage Based Billing Policies: Overview and Usage

Mitchell Paul-Soumis Updated by Mitchell Paul-Soumis

Read Time: 6 mins

Usage-Based Billing is a historically proven method for limiting the average bandwidth usage of a customer's household by providing them a reasonable, but restrictive cap on how much usage they can expect in any given month before additional costs begin to accrue.

By implementing Usage Based Billing in your instance, you'll be able to automate the billing of additional charges as it relates to monthly bandwidth usage. Additional charges will be leveraged based on the settings configured within the policy.

In this article, we'll provide an overview of the pages involved in creating a new Usage-Based Billing (UBB) policy, how to apply it to a service, and how to get the most use out of your billing policy.

Overview

In order to create, or manage existing, Usage-Based Billing policies, follow the below steps:

  1. Click on Settings
  2. Expand the Billing category
  3. Click on "Usage Based Billing Policies"

Creating a new policy

By clicking on the "Create Usage Based Billing Policy" button, the creation modal will open and you can begin filling out the information for a new policy.

  1. This allows you to set a name for the billing policy. We recommend something structured, which indicates the usage limit at a glance.
  2. The Cap in Gigabytes field determines the actual bandwidth usage limit for any services this Usage Based Billing Policy is assigned to.
    The cap is calculated linearly, meaning 1 Terabyte is equal to 1000 Gigabytes.
  3. The Rollover Enabled checkbox determines whether or not unused portions of the set Usage Cap will be carried forward into the following billing period
    1. Enabling the Rollover will result in two new options appearing:
      Rollover Expiration enabled allows you to set a number of months before the Data cap carried forward expires and can no longer be used. This number is set in the "Rollover Expiration months" field.
  4. The "Assess charges at the end of the billing period" will wait until the end of the customer's billing period and only then apply any overage charges incurred.
    If this box is deselected, no overage charges will occur. Typically, you would deselect this option if you were limiting data rates for over-usage accounts instead of billing for extra data.
  5. The "Allow purchase of additional capacity during the billing period" option allows your customers to request additional billing capacity through the use of an Overage service. This appears as a Data Top-Off button in the customer portal, and on the customer's account when opened in your instance.
  6. The Service drop-down allows you to select an Overage service to apply to this Usage Based Billing Policy. This service will be used for both data top-offs and overage charges.
Policy creation example

In this creation scenario, we want to create a new policy, with a 500 GB monthly usage allotment and allowing both data rollover and additional capacity purchase.

For the purposes of this example, we'll assume that we've already created the Overage service for this Usage Based Billing policy.

For a scenario like this one, the Usage Based Billing policy would look something like this:

The Name can be variable, but we've opted for something descriptive and concise, which will simplify its assignment to services later on. We've set the cap to 500 Gigabytes, as we'll be assigning this cap to users of our premium data service, and choose to give them a larger monthly data cap. We've enabled Rollover, and Rollover Expiration, giving the customer 90 days to consume any unused portions of their monthly cap before it disappears.

Finally, we're waiting until the end of the month to calculate any overage charges, and allowing customers on this policy to purchase additional capacity. Any purchased capacity, or usage above the allotment, will use the Overage service we've defined, which will charge $5 for an extra 10 GB of usage.

List overview

Moving on from the creation of a new Usage Based Billing Policy, we'll look at the table view, which lists all Usage Based Billing Policies and their basic information.

  1. The Simple/Advanced toggle allows you to switch between the Simple filtering and the Advanced filtering. You can read more about that in our Filtering: Simple vs Advanced
  2. The Service column will show which of your Overage services are assigned to this Usage Based Billing Policy.
    For more information on Overage Services, take a look at the Services: Overview article available on our Knowledge Base.
  3. The Rollover Enabled column will display whether or not Rollover is enabled for data caps.
  4. The Rollover Expiration Enabled column will show whether or not the policy allows unused data to be moved into the next billing period.
  5. The Rollover Expiration in Months will display the number of months customers will be allowed to carry forward data from one billing period before it expires.
  6. The Cap in Gigabytes column displays the numerical value assigned to the policy.
  7. The Allow Purchase of Additional Capacity During Billing Period column will display whether or not the policy allows your customers to make use of Data Top-Offs when they call in or through the customer portal.
  8. The Assess Charges at the End of the Billing Period column displays whether or not this Usage Based Billing policy will have any additional charges applied and debited only at the end of the billing period, or as they're accrued.
  9. The Edit button allows you to make changes to the UBB Policy, in a modal identical to the creation modal. Expanding the drop-down allows you to delete the UBB Policy entirely
    In order to delete a UBB Policy, you need to make sure it's unlinked from any services in your instance.

Applying a Policy to Restrict Usage

Once you have the Usage Based Billing Policy created, it needs to be applied to a service in order to begin restricting your customer's data usage. You can follow the below steps to add a Usage Based Billing Policy onto one of your services:

  1. Click on Settings
  2. Expand the Billing section
  3. Click on Services

This will bring you to your Services list, where you can create a new service or edit an existing one. For the purposes of attaching a Usage Based Billing Policy to a Data Service, the process is identical for a new service or an edited service.

In either the Create Data Service or Edit Data Service modals, you'll be modifying the "Usage Based Billing Policy" drop-down of the Service Details section:

This drop-down will show all of your available Usage Based Billing policies.

You can have a single Usage Based Billing policy assigned to multiple services, if needed.

What it looks like on an Account

Once a service with a Usage Based Billing Policy is applied to an account, you'll see a new section appear on the Account Overview page:

A similar section is available under the Network & Inventory tab for each account, under the Data Services sub-section:

This section is further detailed in the Account Management View: Overview article.

You can read more information on the "Free Usage" section of this graph in the Usage Based Billing Policy Free Periods: Overview and Usage article.

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