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No, but everything that's not transit is a fixed cost and thus as long as the internal network is properly designed and implemented, only transit costs matter.
by nordify 10y ago
No, but everything that's not transit is a fixed cost and thus as long as the internal network is properly designed and implemented, only transit costs matter. The rest (i.e. the fixed costs) will be covered by the monthly subscription fee.
- rhino369 10y agoIt would take a massive upgrade to most ISP internal networks to allow each home to use 25 mbit at the same time. There are bottlenecks that would have to replaced.
- nordify 10y agoTrue, but it would still be a fixed cost to upgrade.
- mseebach 10y agoIt is very expensive fixed cost that the customers need to pay the amortisation of. Also, it's only fixed as long as it's never maintained or until it needs to be upgraded. You're not going to be satisfied with 25mbit a few years from now.
- nordify 10y agoMaintenance is a percentage of the fixed costs. Upgrades replace old equipment as they have been paid off and decommissioned, so just another fixed cost that replaces the old fixed cost. So fixed costs all around.
- mseebach 10y agoThat certainly depends. But just because a cost is fixed doesn't mean it's free or low.
- nordify 10y agoI made no promises of either free or low.
- mseebach 10y agoThat was literally the premise of the thread. So your entire errand was pointing out the blatantly obviously fact that fixed costs are fixed?
- nordify 10y ago> That was literally the premise of the thread. No it wasn't. The thread starter discussed how broadband connections should be marketed, and the suggestion was to use guaranteed bandwidth as a measure. This then digressed into the cost of bandwidth, where one poster took it totally off the rails by assuming transit costs $25 per Mbps, when the true cost is two decades lower. The fixed cost of providing guaranteed bandwidth in the last mile pales compared to costs like $25 per Mbps, which was my point. The last mile is a fixed cost and even high amounts of guaranteed bandwidth in the last mile are fixed costs which are easily covered by the monthly subscription fee. That does not mean that the fixed costs are free or low by absolute dollar terms. So there.