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fiberguy
My views are my own.
Premium
join:2005-05-20
| reply to rradina
Re: Cable does it too
You've got it right, in many cases, however it's not always right in what you speak of.
In this case, the line equipment is being updated both in the field and in the head ends. So there are still capitol investments going on. Millions of dollars go into upgrades per system.
Using your own example, labor costs go up and it takes labor to install these upgrades. Also, the cost of this new equipment isn't really getting cheaper. Fiber is still expensive and the new equipment is as well. (Example, the RSU house equipment that cable used for digital telephone, cost several hundred dollars.)
Could they lower the costs and keep the speeds where they are? Sure!! Look at AT&T. They keep their DSL priced so low that they don't have the margin to compete, innovate, and bring the fiber to the home like they should. Now, look at Verizon, while they are dropping the price of DSL, their other costs are generally rising and getting higher. But, they are deploying fiber. Same with cable.. cable has made many improvements over the last 20 years alone that are obvious. (Telephone fanboys and cable haters can jump in here if they choose - I will ignore)
Basically, if you take the cheap route to undercut the competition, which DSL providers are doing, you don't get as much innovation and "new" stuff. Those companies that are raising rates, cable/verizon and some other smaller companies, you see the new toys. The way I look at it, I'd pay the extra $15 to have cable or that extra on, ugh, Verizon, KNOWING that they are both pushing hard to deploy new services... unlike AT&T.
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"Complaining is the least path of resistance for the self-reitchous and lazy..." | |
rradina
join:2000-08-08
Chesterfield, MO
| reply to fiberguy
I agree everything goes up but usually technology products get better and cheaper. Although salaries always rise, the cost of equipment used to provide HSI probably isn't rising. At worst, it's getting faster, smaller, cooler and staying the same price. This should enable the company to provide more for less cost -- meaning as they expand their network to service more customers, they can buy less equipment because each new device is faster and can serve more customers.
As an example, think about trying to provide today's typical free e-mail service ten years ago. The prevailing Intel processor was probably something like a Pentium 133mhz. Disks were probably 10GB. Imagine building a server farm to service 1GB e-mail accounts with that hardware! Contrast this with today's quad-core multi-gigahertz processors and terabyte disk drives. Same cost, 100 times the capability.
Of course video services is a different matter. The providers raise costs and those costs must be passed through to the customer. | |
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