4 ms·
The variable cost of selling broadband is extremely low.
by mrkurt 17y ago
The variable cost of selling broadband is extremely low.
- wmf 17y agoThe problem isn't the variable cost; it's the $2,000 truck roll per customer.
- swolchok 17y ago$2000? citation needed.
- wmf 17y agohttp://www.ftthcouncil.org/en/knowledge-center/legislative-regulatory/public-policy/csmg-study-on-ftth-deployment-costs http://www.ftthcouncil.org/en/knowledge-center/legislative-r... Apparently it's down to ~$1,000 if you assume 100% take rate and don't attempt to serve rural areas, but it will easily exceed $2,000 in realistic deployments. In Utah if you're willing to pay for your fiber upfront it's only $3,000. And then you still have to pay the monthly fee for Internet access on top of that. http://www.app-rising.com/2009/11/utopia_proving_new_option_for.html http://www.app-rising.com/2009/11/utopia_proving_new_option_...
- swolchok 17y agoOh, I thought you were insinuating that any truck roll cost $2000. In this case, I can say that your original statement is incorrect: it's not $2000 per customer, it's $2000 per residence at most. (Consider college towns, where lots of residents cycle through few apartments.)
- s3graham 17y agoI'd be fine with a wireless last mile to avoid cable messiness.
- mrkurt 17y agoThey wouldn't be selling "at a loss" based on fixed costs. They'll eventually recoup those somehow, much like AT&T or Comcast or anyone else will. Comcast may hope you'll buy On Demand movies while Google might settle for more Youtube views. Is it selling at a loss if I pay someone $100k to write software and then sell it for $15/pop?