Okay, I will bite... What you are stating / observing is not too far off from what is actually happening at the moment.. I would like to point out and additional dimension which is reality at the moment, working it's way outwards from the Major Metro Areas.... you, myself and our peers may not like what / where this is leading to...
My comments inline. Faisal Imtiaz Snappy Internet& Telecom On 12/23/2010 8:01 PM, MDK wrote: > You know, the thing about this, is that it would probably be GOOD, not bad. > > It would eventually result in people noticing that data consumption is a > little like your water bill... The more you use, the more it costs. This may be true for smaller operators or Wireless Operators, but not true for the Wireline Operators (Telco & Cable)... point to note.. cellular carriers value Data Very Much, and you can see they they don't sell it very cheap. > These people believe that an ISP's connection to you is unlimited... All > you can consume, 24/7. And they base their premise that pricing to pay for > that kind of use, is what people are paying, and that's not true. This is what we as an InternetAccess & Data Communication Industry have told to our customer and trained them as such... so why should one be surprised to see the consumer behaving as such ? > people are paying for, is the average between the users. Eventually, I see > people ASKING to not pay the ever growing bill that will be required when > everyone ( not really, just a significant percentage, like 10 to 30% of > users) streams the evening news, 5 hours of nightly entertainment movies, tv > shows, live peer to peer entertainment and transfers, and other such > bandwidth hungry services. this is where I think you are wrong, Cable & Telco's are grearing up to be able to accomodate such consumer behavior..... Deep Down, both the Cable Co's and Telco's are in the business of 'Last Mile Delivery Network', frankly they could not care less as to what is the content ... they are simply looking to maximize revenue on a per wire connection delivered basis. While, the Wireless ISP's and "Cell Co's" cannot support this model due to the last mile technology they deploy. > If I could buy at a carrier hotel, for $1/Mbit, and had no transport costs, > save my own network, my pricing structure STILL FAILS at about 4 - 8 times > the usage that my average customer now consumes and I'm faced with raising > rates. Frankly, the converse of this is also true... Maybe our services are 'under-priced' to begin with ? We, because of our cut to the bone business model of making little to no profit, choose to sell service at a price that takes a lot of factors into consideration and we may have 'mis-calculated' on the shifting consumer behavior ? > And, that customer is using between 8 and 12 times what he did just > 6 years ago. IE, it's not that long when the internet bandwidth price just > may not matter - no matter how cheap it becomes, and that the final mile and > next to final mile costs will be what drives the price and the way of > marketing services. Reality Check here.... Telco's & Cable Co's are pricing their services based on Network Cost of Last Mile Delivery.. Consideration of Content Cost is pretty much negligible (well with the exception of Cable Tv stuff).. but on IP delivery, they are pretty much taking cost of build out / delivery and amortizing it over 24 to 36 months to come up with the cost (plus some heavy marketing subsidies to gain the subscriber for the long run) > I don't have a great deal on bandwidth, but it's not a BAD deal on > bandwidth, and honestly, the bandwidth cost, though a significant component > of the monthly outgo, and I expect it to fall "per meg" over time, is going > to be less and less relevant - and the cost of delivering that final and > next to final mile, along with customer service, is going to be the BIG > cost. > You are now thinking like the bigger carriers... > What's this mean, in 5 years? I think it means that either certain means > of offering internet are either going to become a menu of services with a > price attached to each, or the overall cost to the consumer is going to > climb so far that people are going to demand "tiered" services so that they, > themselves, choose consumption levels they are willing to pay for. > Keep the info I have shared above and revisit the conclusion.... A. Wireless Internet Service will become marginalized (niche service) as Wired Infrastructure gets built out ? (for this reason the ILEC Monopoly has to break !!, or duopoly has to increase coverage area). B. Cost of Communication Services Consumed by folks will go UP. (I say Communication Cost, not Internet Cost.. go back into time, 20 years ago I was spending about $70 on Phone service, $35 on cable Tv... Today, it is something like $35 voip/Home Phone + $50 Internet DSL + $70 Cable Tv Service + $250 Cell Phone + data Plan..... Over time this will consolidate, and the Telco's and cable Co's are fighting to keep as big as a share the can off it... Plus there are other pay for services HD / DvR / Special Programing etc etc that can kick in another $100 / month from the subscribers... Unfortunately, the WISP's may not have "other addons" to make money from .... personally, when ever I do the un-adulterated business math, I keep coming up with conclusions that .. when Gross Revenue from a Subscriber hits south of $50/month, it is very difficult to turn healthy profit.. when it starts to approach $100/month, things start looking a lot more reasonable and business like. This is very much true for the Cable Co's and the Telco's as well. > I could be all wrong, here, but, hey... It's almost a new year, so I'm > donning my "prophet" hat and shooting off my mouth. Let the debates > commence. > > > > > > ++++++++++++++++++++++++++++++ > Neofast, Inc, Making internet easy > 541-969-8200 509-386-4589 > ++++++++++++++++++++++++++++++ > > -------------------------------------------------- > From: "Larry A Weidig"<lwei...@excel.net> > Sent: Thursday, December 23, 2010 7:30 AM > To: "WISPA General List"<wireless@wispa.org> > Subject: [WISPA] Wow > >> Just wanted to pass this along, as I think it summarizes what >> the general public believes is the entire issue at stake: >> http://www.theopeninter.net/ >> Yikes! >> >> * Larry A. Weidig (lwei...@excel.net) >> * Excel.Net,Inc. - http://www.excel.net/ >> * (920) 452-0455 - Sheboygan/Plymouth area >> * (888) 489-9995 - Other areas, toll-free >> >> >> >> -------------------------------------------------------------------------------- >> WISPA Wants You! Join today! >> http://signup.wispa.org/ >> -------------------------------------------------------------------------------- >> >> WISPA Wireless List: wireless@wispa.org >> >> Subscribe/Unsubscribe: >> http://lists.wispa.org/mailman/listinfo/wireless >> >> Archives: http://lists.wispa.org/pipermail/wireless/ > > > -------------------------------------------------------------------------------- > WISPA Wants You! Join today! > http://signup.wispa.org/ > -------------------------------------------------------------------------------- > > WISPA Wireless List: wireless@wispa.org > > Subscribe/Unsubscribe: > http://lists.wispa.org/mailman/listinfo/wireless > > Archives: http://lists.wispa.org/pipermail/wireless/ > -------------------------------------------------------------------------------- WISPA Wants You! 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