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Time Warner publicly has a 97% margin on operating their high-speed internet. It's not an "if". http://www.huffingtonpost.com/bruce-kushnick/time-warner-cables-
by forrestthewoods 10y ago
Time Warner publicly has a 97% margin on operating their high-speed internet. It's not an "if". http://www.huffingtonpost.com/bruce-kushnick/time-warner-cables-97-pro_b_6591916.html http://www.huffingtonpost.com/bruce-kushnick/time-warner-cab...
It's heavily local politics. Often having to do with utility pole ownership and rights. Here's a classic article for Seattle's situation. Over 18 months just to survey and "make ready" an existing pole. http://crosscut.com/2014/12/google-fiber-never-come-seattle-broadband-internet-2/ http://crosscut.com/2014/12/google-fiber-never-come-seattle-...
If you're the incumbent is can often be best to freeze the system. Sure you don't get to profit or benefit from progress. But no one else does either. Not a bad place to be if you're the presently entrenched winner.
- rayiner 10y agoDebunking that 97% number: http://www.dailycaller.com/2013/02/15/does-cable-really-have-a-97-profit-margin/ http://www.dailycaller.com/2013/02/15/does-cable-really-have... Yes, broadband has a 97% profit margin if you attribute all of the costs of maintaining and operating the network to the TV service, and ignore the costs of building the network in the first place.
- abiox 10y agothey do seem very willing to give rather long (12-24 month) massive discounts to new customers and people who threaten to leave. would seem to be in line with huge margins that they would behave that way.
- rayiner 10y agoHow do? Lots of low margin businesses try to use new customer discounts. Think Groupon.
- rhino369 10y agoThat is in line with how low marginal cost businesses work. Each new customer is essentially free to them. But the first one is massively expensive. It makes sense to give massive discounts to keep people or to get them to sign up.