In the industry this limiting or shaping of ADSL traffic is referred to as traffic prioritisation. Different protocols are set up to manage traffic like gaming, P2P and VoIP.  So what an ISP will do is make sure they cater to their client needs. If the majority of their clients are gamers then that protocol will be a priority. 

However, since not all clients are gamers, some use their internet during the day, some stream at night and some have business meetings using their data on various software.. all this needs to be planned and projected to accommodate all kinds of needs.

During times when there is not heavy traffic on the internet , say at 2 am, all these different types of protocols can move at the speed limit of the line. Some of the traffic will be more important that others and they will be allowed to move as freely as possible. However, when the internet is in full use, some protocols will be slowed down due to congestion. This is when an ISP will make sure there is a “fast lane” and this reserved area will allow the data to still travel at high speed while data considered less important will be slowed down.

Most Internet Providers will set a type of traffic as a major need and this prevents high volume traffic downloads from say only a few customers from flooding the network causing slower speeds. Thus the aim is prevent non time-sensitive download traffic from slowing down interactive and more direct applications like web browsing or email traffic.

This also allows an ISP to adjust to an unusual peak in the usage or traffic or during a network outage so that clients can still have essential services.

So how does this differ from unshaped traffic?  During unshaped traffic all the types of internet protocols are treated exactly the same. This is obviously ideal in an ideal world but there is the chance that a client using a lot of Peer to Peer traffic which is intense and can choke a network and slow it down for others - as there is no intelligent management at this point.  Critical programmes and interactive applications could be hit hard and then clients doing browsing and emailing could also be affected negatively.  This is why traffic prioritisation is preferred by some ISP’s as this reduces the chance of congestion because someone is abusing or using too much traffic over a period of time.

 Does Traffic Prioritisation help during high-demand or outage situations?

During High demand such as streaming sporting events live, or windows updates, this could help to not prioritise these and the client can still perform other tasks adequately.  Here the prioritisation can protect the client from having a situation where he can do nothing else online as at the time of these kinds of demands.

During outages, there is a lower network capacity and this will alter the customers experience due to different demands. Blocking some protocols while the system is being repaired, will then allow the clients to perform basic functions in a situation where there is less traffic available.