Go Back  DVD Talk Forum > General Discussions > Tech Talk
Reload this Page >

Cost of running Broadband

Tech Talk Discuss PC Hardware, Software, Internet and Other Technology

Cost of running Broadband

Old 01-15-04, 09:39 AM
  #1  
DVD Talk Godfather
Thread Starter
 
Michael Corvin's Avatar
 
Join Date: May 1999
Location: Louisville, KY
Posts: 58,112
Received 19 Likes on 11 Posts
Cost of running Broadband

So a friend of mine told me something pretty apalling. He works part time as a BB tech at the cable company. He says it cost less than $7 to provide a home with broadband. So why the hell do we pay $50?

I'm sure the DSL companies would provide it cheaper but they have already seen how much a cash cow the cable companies have created. So why should they lower it to $20-30 when they can make $50?

I always figured it was cheap to provide, but that is lower than I thought.
Old 01-15-04, 10:40 AM
  #2  
DVD Talk Special Edition
 
Join Date: Jan 2002
Location: Chicago
Posts: 1,385
Likes: 0
Received 0 Likes on 0 Posts
Lots of things sell for much more than they cost to produce. For example:
pop
shoes
CDs
Old 01-15-04, 11:36 AM
  #3  
DVD Talk Legend
 
AGuyNamedMike's Avatar
 
Join Date: Jul 2000
Location: (formerly known as Inglenook Hampendick) Fairbanks, Alaska!
Posts: 15,275
Likes: 0
Received 0 Likes on 0 Posts
Exactly. In a free market economy the seller will charge the highest price at which his or her goods will still sell well.
Old 01-15-04, 11:57 AM
  #4  
DVD Talk Platinum Edition
 
Join Date: Oct 2001
Location: Willow Grove, PA
Posts: 3,055
Likes: 0
Received 0 Likes on 0 Posts
I pay $34.99 for DSL from verizon.
Old 01-15-04, 12:28 PM
  #5  
DVD Talk Legend
 
Mopower's Avatar
 
Join Date: Nov 2001
Location: The Janitor's closet in Kinnick Stadium
Posts: 15,726
Likes: 0
Received 0 Likes on 0 Posts
Re: Cost of running Broadband

Originally posted by Michael Corvin
So a friend of mine told me something pretty apalling. He works part time as a BB tech at the cable company. He says it cost less than $7 to provide a home with broadband. So why the hell do we pay $50?

I'm sure the DSL companies would provide it cheaper but they have already seen how much a cash cow the cable companies have created. So why should they lower it to $20-30 when they can make $50?

I always figured it was cheap to provide, but that is lower than I thought.
For his company it costs $7. It depends on the company. For my company we have 1 DSLAM. It was around $10,000. Everytime we have to expand it costs upwards of $3000. We have expanded twice since the purchase of the DSLAM. So we are up to $16,000 in equipment we have to pay for. And then there are the modems. We loan the customer the modem and they give it back when they cancel service. They are $250 each. You pay for all of this out of people's monthly charges. I'm not sure how much the broadband is from the upstream provider. But that increases the bill. Then you have to take the installers wages out, his equipment, cable, gas for his truck etc. It gets expensive very fast. The more customers the more it costs. And if people are willing to pay $40 a month then why not charge $40 a month. That is capitalism.
Old 01-15-04, 01:07 PM
  #6  
Retired
 
Join Date: May 1999
Posts: 27,449
Likes: 0
Received 0 Likes on 0 Posts
Supply and Demand.

I just do without internet at home (though I can plug my cell phone into my laptop and get on at 14.4 to check e-mail) and do all my web surfing/downloading no my lapton on the network at work.

$25/month is my limit for internet, so I'll be waiting on broadband for a good while probably.
Old 01-15-04, 03:45 PM
  #7  
DVD Talk Godfather
Thread Starter
 
Michael Corvin's Avatar
 
Join Date: May 1999
Location: Louisville, KY
Posts: 58,112
Received 19 Likes on 11 Posts
Re: Re: Cost of running Broadband

Originally posted by Mopower
For his company it costs $7. It depends on the company. For my company we have 1 DSLAM. It was around $10,000. Everytime we have to expand it costs upwards of $3000. We have expanded twice since the purchase of the DSLAM. So we are up to $16,000 in equipment we have to pay for. And then there are the modems. We loan the customer the modem and they give it back when they cancel service. They are $250 each. You pay for all of this out of people's monthly charges. I'm not sure how much the broadband is from the upstream provider. But that increases the bill. Then you have to take the installers wages out, his equipment, cable, gas for his truck etc. It gets expensive very fast. The more customers the more it costs. And if people are willing to pay $40 a month then why not charge $40 a month. That is capitalism.
I bought my own modem and hooked it up myself, how difficult that was. Labor and cost of modem to cable company.. $0.
Old 01-15-04, 04:04 PM
  #8  
DVD Talk Legend
 
Join Date: Jan 2000
Posts: 16,173
Likes: 0
Received 0 Likes on 0 Posts
Just wait until power line internet service is more widespread, you will see prices drop

it's happening real soon in a town near me


http://www.washingtonpost.com/ac2/wp...nguage=printer

City May Offer Internet Service Via Power Lines
Trial Program Is a Success, Manassas Utility Official Says
By Eric M. Weiss
Washington Post Staff Writer
Sunday, August 10, 2003; Page PW01


A trial program to deliver the Internet through electric power lines could turn all Manassas families into technology pioneers by the end of the year, the city's top utility officials said.
Since the spring, families in the Wellington neighborhood and an Old Town business have served as test subjects for the new program. Allen Todd, the director of the city's publicly owned utility, said the program has been successful enough that the service is ready to be offered to all homes and businesses that use city power.

"It's really amazing and it's fast," Todd said. "Anywhere you have an electric outlet you have the Internet. You can take your computer to your neighbor's house, down the streets or across town."

The system, which is possible because of advances in computer speed and technology, is cheap and simple because it uses existing power lines and grid instead of cables or phone wires. Manassas is one of 16 municipalities in the state that operate its own electric system, and with only 14,000 customers in a 10-mile area, the city's utility grid is compact enough to offer the system.

Users would plug their computers into a converter box the size of two cigarette packs and then plug the converter into any electric outlet in Manassas. That connects users to the city's fiber optic network and then the Internet,Todd said.The system would require adding equipment to all of the city's 2,000 transformers, but Todd said he hopes to get a company that, in exchange for access to the city's grid, would provide the new equipment, Internet access and billing services.

The city also hopes to get a sizable cut of the connection fees that customers would pay, which Todd estimated at $20 to $30 a month for unlimited access.

Todd said the system also could be an incentive for recruiting new businesses to old buildings, because office space would not have be specially wired.

For an Old Town architecture firm, the service has worked like a charm.

"It's real fast compared to what I have at home, DSL, and it's noticeably quicker," said Sean Porter, an architect with Robert B. Loveless, AIA, Architects, on Main Street. "I mean it's not super quick, but we've never really had a problem. We have it networked with seven computers on it, and it doesn't slow it down."

Todd said companies interested in providing the services and paying for the equipment have until Sept. 8 to bid on the project. After that, the Manassas City Council will decide whether the program is a good deal for the city and residents.

Todd said it would take about three months from the go-ahead to full implementation.

The idea started when Todd was looking for a system that automatically would alert utility officials to power outages. He found the system, but it would cost $1.5 million. With just a little more creativity, officials came up with the new system, which would provide the monitoring service, offer cheap Internet to city residents and make money for the municipal treasury.

That sounds good to Porter, who also lives in the city. Although he is a little surprised that all this pioneering is happening in Manassas.

"You would think this would have happened in the Dulles corridor or in McLean," Porter said.
Old 01-15-04, 04:51 PM
  #9  
DVD Talk Godfather
Thread Starter
 
Michael Corvin's Avatar
 
Join Date: May 1999
Location: Louisville, KY
Posts: 58,112
Received 19 Likes on 11 Posts
very interesting.
Old 01-15-04, 07:29 PM
  #10  
DVD Talk Limited Edition
 
Join Date: Feb 2000
Location: Sunny Hawaii
Posts: 6,702
Received 5 Likes on 3 Posts
What I've heard about the power line Internet trials in our area is that they're throwing up a lot of RF interference which is pissing off a lot of radio guys.
Old 01-15-04, 09:46 PM
  #11  
DVD Talk Legend
 
Mopower's Avatar
 
Join Date: Nov 2001
Location: The Janitor's closet in Kinnick Stadium
Posts: 15,726
Likes: 0
Received 0 Likes on 0 Posts
Re: Re: Re: Cost of running Broadband

Originally posted by Michael Corvin
I bought my own modem and hooked it up myself, how difficult that was. Labor and cost of modem to cable company.. $0.
Good for you. You have cable. You can do that. This depends on your service provider.
Old 01-15-04, 10:12 PM
  #12  
DVD Talk Legend
 
Join Date: Jan 2000
Posts: 16,173
Likes: 0
Received 0 Likes on 0 Posts
Originally posted by Todd B.
What I've heard about the power line Internet trials in our area is that they're throwing up a lot of RF interference which is pissing off a lot of radio guys.
There are several solutions to cure that problem, this is an old issue at this point.
Old 01-16-04, 09:13 AM
  #13  
DVD Talk Hero
 
Join Date: Aug 2001
Location: in da cloud
Posts: 26,196
Likes: 0
Received 0 Likes on 0 Posts
Re: Cost of running Broadband

Originally posted by Michael Corvin
So a friend of mine told me something pretty apalling. He works part time as a BB tech at the cable company. He says it cost less than $7 to provide a home with broadband. So why the hell do we pay $50?

I'm sure the DSL companies would provide it cheaper but they have already seen how much a cash cow the cable companies have created. So why should they lower it to $20-30 when they can make $50?

I always figured it was cheap to provide, but that is lower than I thought.
I think he is mistaken in his numbers. First almost every single cable company has billions of $$ of debt from installing the lines in neighborhoods. It may cost that much in the recurring charges of bandwidth bills, and other costs associated with running an ISP. But I think when you add in the debt that has to be repaid and the other overhead it is probably much more.

http://media.corporate-ir.net/media_...18591/2q03.htm

http://media.corporate-ir.net/media_...gs_3Q/3q03.htm

Here is a link to Comcasts 2Q and 3Q 2003 financials as an example.

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Thread Tools
Search this Thread

Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service - Do Not Sell My Personal Information

Copyright 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.