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The reality is the scarcity of bandwidth is minimal because the infrastructure itself gets cheaper the more customers you have. So adding a new tower or just ad

The reality is the scarcity of bandwidth is minimal because the infrastructure itself gets cheaper the more customers you have. So adding a new tower or just adding more hardware to existing towers is a fixed cost which it's effects go down with the number of paying customers. This is classic economies of scale working in the favor of the Telcos they just don't want to admit it.

rayiner 10y ago
"Economies of scale" means that your per-customer costs go down as you get more customers.[1] Cellular deployment has almost no economies of scale. Deploying a new cell tower costs the same whether you already have 10 towers or 100. Meanwhile, just a handful of users can saturate a tower and/or its backhaul, so more customers requires smaller cells and more towers. [1] https://en.wikipedia.org/wiki/Economies_of_scale https://en.wikipedia.org/wiki/Economies_of_scale.
- Retric 10y ago
  Most towers peak below 50% utilization as bandwidth decreases with range. So, your average cost drops. Put another way, to have good coverage and 1 customer would be ridiculously expensive. There are always going to be areas with few customers. You add towers in areas with lot's of customers.
  - rayiner 10y ago
    Your average cost only drops over a relatively narrow range: from where N towers is enough to support your users to where N+1 towers are necessary. After N is big enough to cover your area, cost still goes up basically linearly with the number of users (just in a saw-tooth fashion rather than a straight line). It's totally unlike the costs of any service with real economics of scale, such as software.
    - Retric 10y ago
      Your thinking in terms of a small coverage area. Networks needs to be nationwide and users are not limited to a single tower. As density increases infrastructure can more closely map to usage. Net effect if 50 million people take X towers then 100 million people take less than 2x towers.
    - TheCoelacanth 10y ago
      For vast swaths of the country, usage would be low enough that it doesn't even fully use one tower. For those areas, the marginal cost of adding a user is effectively zero.
bogomipz 10y ago
There is no causal relationship between scarcity of bandwidth and the price of infrastructure. That makes no sense.

rayiner 10y ago

"Economies of scale" means that your per-customer costs go down as you get more customers.[1] Cellular deployment has almost no economies of scale. Deploying a new cell tower costs the same whether you already have 10 towers or 100. Meanwhile, just a handful of users can saturate a tower and/or its backhaul, so more customers requires smaller cells and more towers. [1] https://en.wikipedia.org/wiki/Economies_of_scale https://en.wikipedia.org/wiki/Economies_of_scale.

Retric 10y ago
Most towers peak below 50% utilization as bandwidth decreases with range. So, your average cost drops. Put another way, to have good coverage and 1 customer would be ridiculously expensive. There are always going to be areas with few customers. You add towers in areas with lot's of customers.
- rayiner 10y ago
  Your average cost only drops over a relatively narrow range: from where N towers is enough to support your users to where N+1 towers are necessary. After N is big enough to cover your area, cost still goes up basically linearly with the number of users (just in a saw-tooth fashion rather than a straight line). It's totally unlike the costs of any service with real economics of scale, such as software.
  - Retric 10y ago
    Your thinking in terms of a small coverage area. Networks needs to be nationwide and users are not limited to a single tower. As density increases infrastructure can more closely map to usage. Net effect if 50 million people take X towers then 100 million people take less than 2x towers.
  - TheCoelacanth 10y ago
    For vast swaths of the country, usage would be low enough that it doesn't even fully use one tower. For those areas, the marginal cost of adding a user is effectively zero.

bogomipz 10y ago

There is no causal relationship between scarcity of bandwidth and the price of infrastructure. That makes no sense.