how-to block ads
|
funchords
Hello
Premium,MVM
join:2001-03-11
Washington, DC
 ·Verizon Online DSL
 ·Skype
| reply to telcolackey
Re: Sandvine's MSO Case Study-Reasonable Network Management?
That was a pretty good write-up, and I do not take issue with most of it.
The speeds didn't increase because it was economical. Long before the move to 6 Mbps, it was already economical.
The speeds increased because of competition. Many DSL providers offered a 3 Mbps tier, and the 6 Mbps tier was the response.
About 6-months to a year before the move to the 6 Mbps basic tier, Brian Roberts told investors on the quarterly earnings conference call that they were doing this because:
1. They could do it very cheaply.
2. The demand was already there, as DSL was signing up customers due to the higher tier.
3. DSL couldn't offer anything close to it.
And he was right. And despite moving to 6 Mbps tiers, despite the increased bandwidth consumption by all users over the past 18 months (not only P2P but YouTube and the like), despite the acquisitions and upgrade costs, Comcast will make roughly $25 Bn in profit this year, topping the previous years' performances of $15.9 Bn, $14.2 Bn, and $12.8 Bn.
said by telcolackey :
The problem has less to do with HFC and more to do with 1) speed increases, 2) p2p and 3) Internet economics. FiOS and others also have the same economic challenges
All, in case you didn't know: (HFC defined)
I'm not sure why you are telcolackey, you impress me more as cable knowledgeable.
The market is demonstrating that the problem has a lot to do with HFC and, in particular, its upload constraint. Cablelabs is behind the competitive ball, and FIOS is taking Cable Internet customers as a result. Cable can't touch a 20/2 tier -- soon to be a 20/20 tier. (Why a 20/20 tier? Ask Brian Roberts! Because it's competitive to do so, demand is there, and they can do it cheaply!)
quote:
People will use corner cases of usage
This is a common way to illustrate a point (especially on forums and usenet and such).
The reason the FCC gave om 2005 for not making Network Neutrality rules was that almost all of the arguments for it were "what if" scenarios. The one or two actual cases that had come up wasn't enough to describe an industry-wide problem.
quote:
(although they won't admit it yet as their product is a "loss leader")
It's a loss-leader product because they had to lay down new fiber throughout every neighborhood. CableTV companies laid new wire too, however they did that 20 years before. The little bit of work that they had to do to make it bi-directional and digital pales in comparison.
--
Robb Topolski -= funchords.com =- Hillsboro, Oregon USA
Are you affected by Comcast's RST forging? How to test it! -or- Read my original report. | |
telcolackey
The Truth? You can't handle the truth
join:2007-04-06
Death Valley, CA
| said by funchords  :The market is demonstrating that the problem has a lot to do with HFC and, in particular, its upload constraint. Cablelabs is behind the competitive ball, and FIOS is taking Cable Internet customers as a result. Cable can't touch a 20/2 tier -- soon to be a 20/20 tier. DOCSIS actually does not have the upstream constraint people think. Most CMTS cards offer equal bandwidth (combined ports) for both upstream and downstream. On the flip side, residential historically is a downstream product and (normally) upsteam users are either running servers / commercial or have rare upstream burst needs (hence powerboost). (please no corner cases)
FIOS 20/20 is as much marketing as technology. It is the same thing cable did to DSL for so many years. FIOS cannot economically support a large number of customers running 20/20 7x24 via their ONT infrastructure.
Technically there are ways to increase capacity for the density of bandwidth requirements, but as you start bringing this level of capacity need upstream the economics start to fall appart.
said by funchords :It's a loss-leader product because they had to lay down new fiber throughout every neighborhood. CableTV companies laid new wire too, however they did that 20 years before. The little bit of work that they had to do to make it bi-directional and digital pales in comparison. Perhaps. But 20/20 will be a loss leader if people run this 7x24 no mater if it is FTTH or HFC. The regional and national costs to deliver continuous content at these speeds is not $50 / month... commercially it is more like $50 / meg (average costs for 50Mb small biz service). | |
espaeth
Digital Plumber
Premium,MVM
join:2001-04-21
Minneapolis, MN
·voip.ms
·Vitelity VOIP
·Callcentric
·VoiceStick
·ViaTalk
 ·Comcast
·Embarq
| reply to funchords
said by funchords :Comcast will make roughly $25 Bn in profit this year, topping the previous years' performances of $15.9 Bn, $14.2 Bn, and $12.8 Bn. That's gross profit, which doesn't include taxes, paid dividends, and other indirect costs. Net profit is much lower than that. Your numbers also appear to be off:
»finance.google.com/finance?fstyp···AQ:CMCSA
Year to date gross profit: is ~$14.6Bn so unless they're going to have a magical $10Bn Q42007 there's no way they're going to make $25Bn.
Compare total operating expenses to total revenue. Comcast is certainly making money, but not hand-over-fist like you are suggesting. | |
espaeth
Digital Plumber
Premium,MVM
join:2001-04-21
Minneapolis, MN
·voip.ms
·Vitelity VOIP
·Callcentric
·VoiceStick
·ViaTalk
·Comcast
·Embarq
| reply to telcolackey
said by telcolackey :said by funchords :The market is demonstrating that the problem has a lot to do with HFC and, in particular, its upload constraint. Cablelabs is behind the competitive ball, and FIOS is taking Cable Internet customers as a result. Cable can't touch a 20/2 tier -- soon to be a 20/20 tier. DOCSIS actually does not have the upstream constraint people think. Most CMTS cards offer equal bandwidth (combined ports) for both upstream and downstream. Actually, there are upstream constraints to both FiOS and DOCSIS cable systems. They both share the same "multiple speaker" problem; within a shared access segment only one device can be transmitting at any given time. The downstream is easy because the head-end has monopolistic control over the downstream channel with no competition for "air time"; it broadcasts out and every device on the segment listens for traffic destined to them. The return path requires more technical finesse to work out how to get every device to transmit in an orderly fashion so that transmissions don't get garbled and lost. It's like being on a conference call -- if multiple people talk at the same time all conversations are lost until it gets down to the point where just one person is talking. Multiplexing technologies like TDMA work well at solving this problem, but it requires additional overhead which steals your upstream efficiency. On current DOCSIS systems that's why you have a 38mbps downstream to 10mbps upstream (DOCSIS 1.x) or 30mbps upstream (DOCSIS 2.0).
FiOS has similar limits; their current deployed configuration is limited to 622mbps downstream and 155mbps upstream. The big difference is that while cable operators have 200-500 homes per HFC node, FiOS is only divided out so 32 homes share a head-end port. It'll be interesting to watch how things work out for Verizon with the 15/15 and 20/20 symmetrical rollouts, because even if you ignore bandwidth reservations for voice services 155mbps / 32 homes is still ~4.8mbps per home. There's also that problem of selling $150 - $200 of wholesale bandwidth for $50-70/mo. If people really start using their connections as people in these forums suggest, that's going to be a big problem.
Cable could match FiOS for service with DOCSIS 3.0, but it would require much smaller node segments than what they have now. | |
funchords
Hello
Premium,MVM
join:2001-03-11
Washington, DC
·Verizon Online DSL
·Skype
| reply to espaeth
Overall, my effort was to show that Comcast was doing quite well. And it is.
said by espaeth :That's gross profit, which doesn't include taxes, paid dividends, and other indirect costs. Net profit is much lower than that. Right.
Net profit is the wrong figure to concentrate on, due to the non-operating or 'slushy' things it contains (advanced tax payments, amortized "goodwill," minority interest, one-time events).
We need something without all of that slush -- and you touched on it further down in your message... (stand-by)
said by espaeth : Your numbers also appear to be off: » finance.google.com/finance?fstyp···AQ:CMCSAYear to date gross profit: is ~$14.6Bn so unless they're going to have a magical $10Bn Q42007 there's no way they're going to make $25Bn. You are correct. I got my figures from »finance.yahoo.com/q/is?s=CMCSA which turns out to be wrong. Google got it right.
Compare total operating expenses to total revenue. Comcast is certainly making money, but not hand-over-fist like you are suggesting.
Agreed. That's Operating Income (or Loss). That's what should have been compared. Those are hard dollars both ways.
And truth be told, we should both probably only be looking at the Internet side of the business. I don't know if Comcast breaks it down enough to do that (how do you apply the cost of "Triple Play" advertisements?).
--
Robb Topolski -= funchords.com =- Hillsboro, Oregon USA
Are you affected by Comcast's RST forging? How to test it! -or- Read my original report. | |
|
