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Steam measures mega BYTES per second\
100 mpbs (your ISP) = 12.5 mBps (what steam measures)
Your 10MBps from Steam is fairly close to saturating your ISPs 100mps connection.
Also note that Steam downloads only deltas of games patches then applies them locally. If you're patchign somethign like DOTA2 it'll downlaod/patch/download/patch/download so how it behaves deends.
Constant throroughput usually happens when you're downloading a game for the first time.
If you're still having issues try changing your download region. Note that steam ues standard HTTP to send you stuff so it's pretty simple.
Yeah, it was Skyrim I was downloading, I had some problems with sounds not working on an external drive so had to download it twice, it was a good opportunity to test the connection.
The problem only happened when I disabled the bandwidth cap. This is the first time I've had to use the bandwidth cap though, I was just experimenting when I noticed the problem.
This didn't happen when my internet speed was slower, Steam was always saturating my connection yet it never did the "full speed for 5 seconds, 0bytes/s for 5 seconds" thing until today.
I'll see what happens when I change the region.