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This does not increase the cost to ISPs. It does marginally decrease their profits. A profit is not a cost, and despite what finance bros think lower profits

This does not increase the cost to ISPs. It does marginally decrease their profits. A profit is not a cost, and despite what finance bros think lower profits are also not a cost. It is perfectly possible to supply 1000Mbps symmetrical fiber service to end users for $20/mo because numerous self-sufficient non-profit municipal broadband organizations in the United States are doing just that. This is 2.5% the capacity for 75% the money. If ISPs can't figure out how to do that profitably, they deserve to fail. After several decades of taking public money to build out their networks, ISPs can give back a little by very slightly lowering their margins when serving low income residents.

bko 2y ago
What does that have to do with what I wrote? If you want to transfer some ISP profits to low income New Yorkers, do that directly
- websap 2y ago
  They just did.
- snakeyjake 2y ago
  Did you read what you wrote or was it a stream-of-consciousness thing? Because you wrote: > This will increase costs for ISPs and likely increase prices for others. It will not increase costs. Which is what I wrote.
  - bko 2y ago
    That wasn't a crucial point of my argument. I disagree but everything I said still applied if you replace increase costs to decrease profits. And there is a response to these things, like increased costs. This is pretty uncontroversial basic economics. Even that doesnt matter. Just do it directly so you know exactly how much the subsidy is worth. Tax their profits and transfer it to the people. It's simpler, more visible, less unintended consequences
    - snakeyjake 2y ago
      > Just do it directly It is impossible to do it more directly than at the point of sale. Literally every other method is less direct. A tax is ten thousand times less direct.
      - bko 2y ago
        Forcing someone to provide a service at below market price is not direct. It would be more direct by taking the market price for these goods and purchasing them directly. Then you have a line item that perfectly encapsulates the subsidy and the transfer and you can reason about it. That's what I mean by direct
    - ToucanLoucan 2y ago
      > Tax their profits and transfer it to the people. It's simpler, more visible, less unintended consequences How is that simpler? I'm assuming by "transfer it to the people" you're talking about a subsidy paid out where the customer pays $15 and the municipality then pays the balance, but why should they? The data networks the ISP is paywalling access to were in large part already funded by the taxpayer. And besides-which, that doesn't put a cap on the price the ISP can charge at all, and in fact gives them a reliable avenue to now help themselves to either the pocket books of the people it's meant to be benefitting, or the state coffers, neither of which is a good solution. And as to the market effects, I mean genuinely, have you ever purchased internet service? Because I have since I moved out of my parents house in the mid 10's, and I assure you as a sysadmin and pretty techy person, in that time, I needed ONE (1) service call to address an issue in their wiring, and apart from that, to my knowledge, I was basically 100% profit, minus whatever expenses go into maintaining the trunk, and my price went from about $70 per month to within shouting distance of $200 over the course of 3 years, and then stayed there for the subsequent four years, for pretty middle of the road service at half a gig down and about 35 MB up. So I guess by your logic, there must've been a hell of a lot going up further up the trunk to justify me paying ballpark $7,000 over those months. Or, more likely, the CEO wanted another yacht. Edit: This stuck in my craw so I googled a bit, and the biggest provider of fiber service in New York is Verizon FIOS, who posted a profit last year of EIGHTY. BILLION. DOLLARS. So you'll forgive me if I have doubts that even if we presume they're losing their shirts on this $15 per month program for qualifying low income folks on a per-address basis, that they're going to go under about it. I think they'll manage just fine.
- Yizahi 2y ago
  While sometimes direct monetization of the benefits is a better solution, in this particular case it is not. First of all government in this case doesn't want to give some cash to to the poor, it wants to provide them with access to information. So instead of giving people cash, then verifying if they are spending it on the internet, they are streamlining process for it. And second, direct monetization of benefits won't work in this case. Essentially government is taking some cost out of ISP pocket and redirecting it to the poor ISP customers. But if they monetized same process, the government wouldn't know who to give that money. They would need to additionally track if a poor person is a subscriber or no, and where is he currently located at all times, to know which ISP's money should be redirected to whom. It is way more work for almost no benefit.
toast0 2y ago
> It is perfectly possible to supply 1000Mbps symmetrical fiber service to end users for $20/mo because numerous self-sufficient non-profit municipal broadband organizations in the United States are doing just that. Probably depends on a lot of things, but my local municipal broadband is an open provider model, my provider charges $95/month and the municipal network takes $59 of that (as of Jan 1 2023). The municipal network doesn't provide IP transit, just gets my bits to my ISP's office. Where in the US is it $20/month? > This is 2.5% the capacity for 75% the money. If ISPs can't figure out how to do that profitably, they deserve to fail. Most of the actual cost is maintaining a line to customer premises. My municipality charges ISPs $49/month for 100m and $59/month for 1G, although there's not a real difference in operating costs; either the fiber is up or it's down, and the truck roll to fix an issue is the same. There's maybe an argument that a 100m customer can't/won't cause congestion on the municipal network because (as implemented on my local network), the biggest oversubscription is 48 customers on a 10G uplink. A 25mbps plan would have the same basic costs for my municipality as a 100m plan, although it might actually be trickier because they couldn't just use an ethernet speed setting somewhere in the path to limit speed. I suspect incumbent broadband providers have some cost advantages over my municipal system, because incumbents have better take ratios, but I honestly doubt they can actually cover costs of just providing a line with service to a home in their territory for $15/month or $20/month.
_bin_ 2y ago
You are considering only short run marginal cost, not long run; i.e., you're not factoring things like amortizing infra build-out. if repaying that is restricted to a smaller pool of customers, prices for them will go up. worse, this intentionally affects only large, national ISPs, so NY state is effectively leeching off customers in other states to subsidize a NY-only social program. there should be a credible challenge under the commerce clause because of this.
betaby 2y ago
> It is perfectly possible to supply 1000Mbps symmetrical fiber service to end users for $20/mo because numerous self-sufficient non-profit municipal broadband organizations in the United States are doing just that. This statement is false.
- orwin 2y ago
  I have almost (800 Mbps) that for 30 euros per month, but I'm not from the US. Pretty sure the first year it was 20€/month too.
from-nibly 2y ago
> This does not increase the cost to ISPs. > It does marginally decrease their profits. Right because they wont claw that back when all ISPs are also suffering the same fate.
Am4TIfIsER0ppos 2y ago
Can you tell the ISPs in my neck of the woods (Brussels, supposed capital of Europe) to get off their ass and offer 1G symmetic fiber for any price.
- toast0 2y ago
  For any price, I'm sure you can arrange for fiber construction, but it's not going to be cheap. From personal experience, not many people are willing to pay tens of thousands of dollars on fiber construction to get 1g symmetric, and then pay a hefty sum monthly. Maybe from someone like this. https://www.belcenter.be/en/blog/tout-savoir-sur-la-fibre-dediee-pour-votre-entreprise/ https://www.belcenter.be/en/blog/tout-savoir-sur-la-fibre-de...
- inemesitaffia 2y ago
  I'm sure if you pay for DIA they'll bring it to you.
inemesitaffia 2y ago
It's a significant, not marginal reduction in profits. This money is around 2 customer care calls. Or 0.2 truck rolls.

bko 2y ago

What does that have to do with what I wrote? If you want to transfer some ISP profits to low income New Yorkers, do that directly

websap 2y ago
They just did.
snakeyjake 2y ago
Did you read what you wrote or was it a stream-of-consciousness thing? Because you wrote: > This will increase costs for ISPs and likely increase prices for others. It will not increase costs. Which is what I wrote.
- bko 2y ago
  That wasn't a crucial point of my argument. I disagree but everything I said still applied if you replace increase costs to decrease profits. And there is a response to these things, like increased costs. This is pretty uncontroversial basic economics. Even that doesnt matter. Just do it directly so you know exactly how much the subsidy is worth. Tax their profits and transfer it to the people. It's simpler, more visible, less unintended consequences
  - snakeyjake 2y ago
    > Just do it directly It is impossible to do it more directly than at the point of sale. Literally every other method is less direct. A tax is ten thousand times less direct.
    - bko 2y ago
      Forcing someone to provide a service at below market price is not direct. It would be more direct by taking the market price for these goods and purchasing them directly. Then you have a line item that perfectly encapsulates the subsidy and the transfer and you can reason about it. That's what I mean by direct
  - ToucanLoucan 2y ago
    > Tax their profits and transfer it to the people. It's simpler, more visible, less unintended consequences How is that simpler? I'm assuming by "transfer it to the people" you're talking about a subsidy paid out where the customer pays $15 and the municipality then pays the balance, but why should they? The data networks the ISP is paywalling access to were in large part already funded by the taxpayer. And besides-which, that doesn't put a cap on the price the ISP can charge at all, and in fact gives them a reliable avenue to now help themselves to either the pocket books of the people it's meant to be benefitting, or the state coffers, neither of which is a good solution. And as to the market effects, I mean genuinely, have you ever purchased internet service? Because I have since I moved out of my parents house in the mid 10's, and I assure you as a sysadmin and pretty techy person, in that time, I needed ONE (1) service call to address an issue in their wiring, and apart from that, to my knowledge, I was basically 100% profit, minus whatever expenses go into maintaining the trunk, and my price went from about $70 per month to within shouting distance of $200 over the course of 3 years, and then stayed there for the subsequent four years, for pretty middle of the road service at half a gig down and about 35 MB up. So I guess by your logic, there must've been a hell of a lot going up further up the trunk to justify me paying ballpark $7,000 over those months. Or, more likely, the CEO wanted another yacht. Edit: This stuck in my craw so I googled a bit, and the biggest provider of fiber service in New York is Verizon FIOS, who posted a profit last year of EIGHTY. BILLION. DOLLARS. So you'll forgive me if I have doubts that even if we presume they're losing their shirts on this $15 per month program for qualifying low income folks on a per-address basis, that they're going to go under about it. I think they'll manage just fine.
Yizahi 2y ago
While sometimes direct monetization of the benefits is a better solution, in this particular case it is not. First of all government in this case doesn't want to give some cash to to the poor, it wants to provide them with access to information. So instead of giving people cash, then verifying if they are spending it on the internet, they are streamlining process for it. And second, direct monetization of benefits won't work in this case. Essentially government is taking some cost out of ISP pocket and redirecting it to the poor ISP customers. But if they monetized same process, the government wouldn't know who to give that money. They would need to additionally track if a poor person is a subscriber or no, and where is he currently located at all times, to know which ISP's money should be redirected to whom. It is way more work for almost no benefit.

toast0 2y ago

> It is perfectly possible to supply 1000Mbps symmetrical fiber service to end users for $20/mo because numerous self-sufficient non-profit municipal broadband organizations in the United States are doing just that. Probably depends on a lot of things, but my local municipal broadband is an open provider model, my provider charges $95/month and the municipal network takes $59 of that (as of Jan 1 2023). The municipal network doesn't provide IP transit, just gets my bits to my ISP's office. Where in the US is it $20/month? > This is 2.5% the capacity for 75% the money. If ISPs can't figure out how to do that profitably, they deserve to fail. Most of the actual cost is maintaining a line to customer premises. My municipality charges ISPs $49/month for 100m and $59/month for 1G, although there's not a real difference in operating costs; either the fiber is up or it's down, and the truck roll to fix an issue is the same. There's maybe an argument that a 100m customer can't/won't cause congestion on the municipal network because (as implemented on my local network), the biggest oversubscription is 48 customers on a 10G uplink. A 25mbps plan would have the same basic costs for my municipality as a 100m plan, although it might actually be trickier because they couldn't just use an ethernet speed setting somewhere in the path to limit speed. I suspect incumbent broadband providers have some cost advantages over my municipal system, because incumbents have better take ratios, but I honestly doubt they can actually cover costs of just providing a line with service to a home in their territory for $15/month or $20/month.

_bin_ 2y ago

You are considering only short run marginal cost, not long run; i.e., you're not factoring things like amortizing infra build-out. if repaying that is restricted to a smaller pool of customers, prices for them will go up. worse, this intentionally affects only large, national ISPs, so NY state is effectively leeching off customers in other states to subsidize a NY-only social program. there should be a credible challenge under the commerce clause because of this.

betaby 2y ago

orwin 2y ago
I have almost (800 Mbps) that for 30 euros per month, but I'm not from the US. Pretty sure the first year it was 20€/month too.

from-nibly 2y ago

> This does not increase the cost to ISPs. > It does marginally decrease their profits. Right because they wont claw that back when all ISPs are also suffering the same fate.

Am4TIfIsER0ppos 2y ago

Can you tell the ISPs in my neck of the woods (Brussels, supposed capital of Europe) to get off their ass and offer 1G symmetic fiber for any price.

toast0 2y ago
For any price, I'm sure you can arrange for fiber construction, but it's not going to be cheap. From personal experience, not many people are willing to pay tens of thousands of dollars on fiber construction to get 1g symmetric, and then pay a hefty sum monthly. Maybe from someone like this. https://www.belcenter.be/en/blog/tout-savoir-sur-la-fibre-dediee-pour-votre-entreprise/ https://www.belcenter.be/en/blog/tout-savoir-sur-la-fibre-de...
inemesitaffia 2y ago
I'm sure if you pay for DIA they'll bring it to you.

inemesitaffia 2y ago

It's a significant, not marginal reduction in profits. This money is around 2 customer care calls. Or 0.2 truck rolls.