Cogent Communications today unveiled a new approach to pricing that will lower bills for customers with periodically high volumes of bursty traffic.

Traditionally, to determine monthly bandwidth consumption, Internet Service Providers take periodic samples of traffic volume, throw out the highest 5% in traffic spikes or bursts and then bill at an average of the remaining rate. Cogent’s new pricing will bill at 90% of the rate, throwing out the highest 10% of usage peaks and effectively lowering the bills of many customers.

“We think the current pricing method is unfair to customers with lumpy traffic,” said Cogent CEO Dave Schaeffer. “We have a couple of customer segments that we think this is particularly helpful for, because they had certain peaks in traffic.”

That customer group includes universities, which see traffic peak at the beginning and end of a session, Web hosting companies whose traffic spikes during specific events and content providers who also can see dramatic peaks in traffic.

“This is a way of treating customers more fairly,” Schaeffer said. “We could have lowered our price, but the $10 a Meg price defined Cogent and we’ve never lowered it. This is was a way of passing on additional value to customers.”

The Cogent CEO said his firm hopes other ISPs will follow suit, as that would promote applications that ultimately consume more bandwidth.