Linux Advanced Routing & Traffic Control HOWTO
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Chapter 9. Queueing Disciplines for Bandwidth Management

Table of Contents
9.1. Queues and Queueing Disciplines explained
9.2. Simple, classless Queueing Disciplines
9.2.1. pfifo_fast
9.2.2. Token Bucket Filter
9.2.3. Stochastic Fairness Queueing
9.3. Advice for when to use which queue
9.4. Terminology
9.5. Classful Queueing Disciplines
9.5.1. Flow within classful qdiscs & classes
9.5.2. The qdisc family: roots, handles, siblings and parents
9.5.3. The PRIO qdisc
9.5.4. The famous CBQ qdisc
9.5.5. Hierarchical Token Bucket
9.6. Classifying packets with filters
9.6.1. Some simple filtering examples
9.6.2. All the filtering commands you will normally need
9.7. The Intermediate queueing device (IMQ)

Now, when I discovered this, it really blew me away. Linux 2.2/2.4 comes with everything to manage bandwidth in ways comparable to high-end dedicated bandwidth management systems.

Linux even goes far beyond what Frame and ATM provide.

Just to prevent confusion, tc uses the following rules for bandwith specification: 
mbps = 1024 kbps = 1024 * 1024 bps => byte/s
mbit = 1024 kbit => kilo bit/s.
mb = 1024 kb = 1024 * 1024 b => byte
mbit = 1024 kbit => kilo bit.
Internally, the number is stored in bps and b.

But when tc prints the rate, it uses following :

1Mbit = 1024 Kbit = 1024 * 1024 bps => bit/s
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Multicast routing Queues and Queueing Disciplines explained