CircleID

P2P services are inherently scalable?  No, they're not, though they are much easier to provide cheaply in high volume, and many are scalable.  "Some early P2P implementations of Gnutella had scaling issues." - http://en.wikipedia.org/wiki/Scalability

You're confabulating 'inexpensive' and 'scalable'.

If a service runs on a central host, and adding resources allows it to scale in a linear or better fashion, then it's scalable.

But you're right about the economics and you're right about survivability, provided you're talking about a P2P system that has no central server; most P2P systems do rely on a central server for some things.

ISPs will deal with the increased traffic in order to prevent severe congestion.  Some will just try to ban, block or throttle it (with tools like these) while others will add capacity, and most will do some of both.  If you're an ISP, one relatively cheap way to add capacity is to set up P2P content distribution nodes on your ISP network to feed your users.

Let's consider a user on a typical 1.5Mbps downstream DSL link paying $30/mo. Consider the worst case: they're pulling down 1.2Mbps 24/7, AND none of the content is coming from the ISP's own network.  It's only paying about $10/Mbps/month for peering since it's buying in bulk.  So, sure that's significant, but it's not completely unsupportable.  A 6Mbps cable customer paying $50/mo and using it 100% 24/7 is going to be more of a strain, plus the shared medium setup on a cable network means that there will be congestion if enough customers in a neighborhood try to do this. 

Not surprisingly, given my quick calculations, Comcast is known to use Sandvines and block, e.g. BitTorrent seeding, while I don't think AT&T;has done that yet.

I remember when I first got DSL (circa '98) and called up the PacBell NOC because a 56kbps video stream I had bought access to was hitting extreme congestion on their backbone, and it took them a couple weeks to fix the problem, by adding capacity.  Having to constantly add capacity isn't new; it's been the rule since the 'net was born.