one reason so many CLEC's have gone under is that prices are too low, not too high. They were unable to attain positive cash flow.
All these 100 mbs college students have benefited from what has been effectively a free resource. Once they start paying their own bills, their attitudes may well change. this is a well known economic principal, essentially a function of supply and demand. When a product or service is free, then demand is limited only by supply. When a product or service costs, then demand becomes limited by the willingness and ability of people to pay. If my high speed internet access is free, then I "need" all these services. If I have to pay for it, then maybe I don't really "need" as much as I thought I did. Chuck ""Priscilla Oppenheimer"" wrote in message [EMAIL PROTECTED]">news:[EMAIL PROTECTED]... > A few more random thoughts.... > > I would add that the first wave of college students who got used to > 100-Mbps in their dorm room are graduating. They aren't going to put up > with 56-Kbps modems at home. Plus they expect to do file sharing with > enormous music and video files. They will expect cheap bandwidth, however. > The prices need to come down, I think. > > This industry is cyclical. It will come back. It always has before, anyway. > And, new uses for the network are going to drive bandwidth needs. They > always have before anyway. For many years we have been able to forsee new > uses for networking that aren't available yet. But they will become > available. > > One more thought: Security is hot. Maybe companies aren't building up their > networks now, but they definitely want to protect them. People I know who > got laid off in September are back to work doing security now. > > Priscilla > > At 01:41 PM 2/19/02, Steve Ridder wrote: > >My first message never came through, so I'll try again... > > > >It's true that TV's, phones, radios, and cable have a larger market share, > >but it took like 50 years for those technologies to reach critical mass! As > >I keep saying, the Internet is still in it's infancy. > > > >The problem that the dot.bomb's, telecom providers, and others had is the > >same you seem to be having - it's not going to happen overnight. It's going > >to take time. It's also going to take new and creative uses for the Intenet > >in order to create demand for Internet useage and high-speed links. Just as > >the static web page is popular now, it will be replaced with things such as > >video-on demand, file-sharing peer-to-peer apps that Napster proved to be so > >popular, and even peer-to-peer computer OS's (every major company is trying > >to come up with one, .Net, JINI and others just to name a few). Thses > >things need networks. Plus, tehcnology has gotten better, faster and > >cheaper since the ancient times, so I don't doubt that prices will come > >down. I would never bet against technology. Remember, "640k ought to be > >enough for anyone"? > > > >Also, there isn't a computer in evey home yet, as they can be complicated > >for granny and grampa to use, and they are still quite expensive. The web > >will soon be accessed with simple devices other than computers, such as your > >cable box or reffrigerator, greatly expanding the net. > > > >All these things will expand the Net and create jobs. > > > >I nrf wrote: > > > > > > ""Steven A. Ridder"" wrote in message > > > [EMAIL PROTECTED]">news:[EMAIL PROTECTED]... > > > > That article taked about 1 problem, the problem almost every > > > company had - > > > > grabing too much land and equipment with no customers or > > > sustainable > > > > revenue. But that's also the problem every dot-bomb had. > > > Thankfully the > > > > buble burst, the madness ended and took out the garbage. No > > > company would > > > > stay in business that way. This dosen't mean that their > > > services weren't > > > > wanted. Most every home who has a dial-up, most buisinesses > > > that don't > > > have > > > > DSL in their area are still waiting for the right > > > company/technology to > > > come > > > > by and at the right price. > > > > > > I'm afraid I have to disagree. The simple fact is that in many > > > cases, the > > > services were in fact not wanted, at least at the price points > > > they were > > > offered at, but then of course if they were offered at lower > > > price points, > > > there would have been even less profit than there already was. > > > And the fact > > > is, despite all the hype from New Economy providers, there is > > > not a huge > > > outcry of demand for high-speed access. There is some demand, > > > but nowhere > > > near the demand that a lot of people thought there would be. > > > > > > I used to believe otherwise. Because I'm always doing stuff on > > > the Net, and > > > therefore I rely on my broadband, I assumed that there must > > > have been > > > ravenous demand for broadband connections. I assumed that > > > everybody was > > > like me. Wrongo. The fact is that there is only a small > > > subset of the > > > population that is tech and computer savvy and can honestly > > > feel the > > > difference between a broadband link and standard dialup, > > > certainly enough > > > that they would feel the need to pay extra for broadband. > > > > > > The numbers bear this out. In the past, broadband was not > > > widely > > > available, but not this is not so. It is estimated that well > > > over 70% of > > > households within the US have access to some kind of broadband > > > (cable/DSL/satellite/fixed wireless). (70% of all U.S. > > > households have > > > access to high-speed cable, and I'm not even talking about the > > > other kinds > > > of broadband - > > > http://www.ntia.doc.gov/ntiahome/broadband/comments2/Napster.htm, ) Yet > a > > > sobering fact is that even where broadband is available, > > > consumer demand has > > > been low: "...even where there is deployment of broadband > > > infrastructure, > > > there has been low consumer uptake...Groups such as the > > > Consumer Energy > > > Council of America and the National Cable Television > > > Association have also > > > noted the slow uptake of consumer use of DSL and cable modems > > > even where > > > currently deployed." > > > http://www.digitaldividenetwork.org/content/stories/index.cfm?key=10 > > > > > > Perhaps the most sobering is the Hart/Winston study that > > > states: ' "The > > > bottom line is that among people who are most likely to > > > subscribe to > > > high-speed Internet access, the obstacles are price and lack of > > > appeal," > > > said Hart, CEO of Hart Research. "Forty-eight percent have no > > > interest > > > regardless of price and another 21 percent are willing to pay > > > at most $20 > > > per month. If you cannot win over the people who are currently > > > using the > > > Internet, consumer acceptance of high-speed access will be slow > > > and > > > limited..." ' > > > http://www.comptel.org/press/nov29_2001_voices.html > > > > > > If you still need convincing, then flip things around. If > > > there really is > > > this huge groundswell of demand for broadband access, then > > > ..."...why have > > > only 10 percent of those with access to broadband purchased it?" > > > (http://www.theneteconomy.com/article/0,3658,s=916&a=19232,00.asp). In > >the > > > United States, basic phone uptake rates are at 99% or so, basic > > > cable TV is > > > about 70%, uptake, digital cable TV is about 25% uptake, and > > > cellphone > > > uptake is at least 25% (uptake defined to be those people who > > > can get who > > > choose to get it). So why is broadband uptake so low? You > > > would think that > > > if people were beating down the doors for broadband, that > > > uptake would be > > > much much higher than it is. Or, as Stephen Ricchetti said > > > it best: > > > "Overwhelmingly, people think it's a bad deal at current > > > costs," Ricchetti > > > said. "What we are looking at is a demand issue, not a supply > > > issue" > > > http://www.theneteconomy.com/article/0,3658,s=916&a=19232,00.asp > > > > > > The simple fact is, the demand is not really there. The vast > > > majority of > > > people (generally high-income, tech-savvy people) who want > > > high-speed access > > > already have it. The majority of the population is not like > > > this, and for > > > whatever reason do not see a whole lot of value in high-speed. > > > Is this a > > > price thing - is it just too expensive? Maybe (but according to > > > Hart/Winston, when 48% of people currently without broadband > > > express no > > > interest in it, and another 21% will not pay more than what > > > they pay for > > > dialup, maybe price is not the issue - > > > http://www.comptel.org/press/nov29_2001_voices.html). Or is > > > it a problem > > > with perception and marketing? Or both? Who knows? > > > > > > Another depressing snippet from Hart/Winston: > > > "...Other data show that while the majority believed some form > > > of Internet > > > access should be available in all parts of the country, > > > relatively few users > > > (30 percent) place a high priority on ensuring that all > > > Americans have > > > access to high-speed service. In fact, more respondents (32 > > > percent) rated > > > this a low priority." > > > > > > > > > > > > > > > > > > > > > > > > > > > > Now we just have to wait for the right technology to > > > > come by and offer good service at a good price. > > > > > > I can't deny that things like Moore's law implies continual > > > advances. But > > > from what the above studies have shown, we might be waiting > > > around for > > > awhile. The consumers have spoken - the majority of them are > > > perfectly > > > happy with dial and do not want more than that, certainly not > > > at higher > > > cost. After all, dial has one gigantic advantage over > > > broadband - dial is > > > simply more reliable. " "A new technology that decreases > > > reliability and > > > uptime isn't "technologically advanced" - it's buggy. Outside > > > of early > > > adopters and speed freaks, I don't see a sizeable percentage of > > > the > > > population paying two and a half times as much for flakier > > > Internet > > > access....Stable technologies tend to last, whatever their > > > weaknesses > > > compared to newer, glitzier ones" " > > > > >http://www.theneteconomy.com/article/0,3658,s%253D916%2526a%253D13570,00.as p > > > > > > > > > > > > > There is also another problem that was just as bad - the > > > market was > > > flooded > > > > with service providers. There was WAY too much supply and > > > only moderatre > > > > demand. > > > > > > Yep exactly. But again, this is apparently what people want. > > > Or look at it > > > the other way - rather than having lots and lots of providers > > > killing each > > > other in the market, would things be better if there were only > > > a small > > > handful of giant providers that held large market sway? > > > > > > And I think the term 'moderate' is too strong. A better > > > description of > > > demand is 'fair' or 'tepid'. The simple fact is that while > > > there is a big > > > difference between being connected to the Internet and not > > > being connected, > > > once you are connected, having higher speeds is of only minor > > > benefit. > > > "...the ones who tend to be impressed are those who do large > > > file transfers > > > through FTP or HTTP. Casual Web browsers, on the other hand, > > > are surprised > > > at how little speed increase they see with ADSL. That shouldn't > > > be > > > surprising; Most of the World Wide Wait is time waiting for > > > overloaded > > > servers, not time waiting for data to make it through clogged > > > pipes." > > > > >http://www.theneteconomy.com/article/0,3658,s%253D916%2526a%253D13570,00.as p > > > > > > > > > > > > > > I still see plenty of growth in this industry, even excluding > > > the service > > > > provider market. > > > > > > > > > I hope so too. But the data seems to indicate a much more > > > pessimistic > > > future, at least in the short run. > ________________________ > > Priscilla Oppenheimer > http://www.priscilla.com Message Posted at: http://www.groupstudy.com/form/read.php?f=7&i=35913&t=35611 -------------------------------------------------- FAQ, list archives, and subscription info: http://www.groupstudy.com/list/cisco.html Report misconduct and Nondisclosure violations to [EMAIL PROTECTED]
