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 wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | reply to Guspaz
Re: There is more to it... said by Guspaz:It shouldn't be a problem. Any ISP that is a wholesaler of Bell Canada's DSL services (TekSavvy included) has about $9 to play with as far as bandwidth, equipment, staff, etc. Bell charges $20.50 for the line, and $1300 for the GigE to connect the DSL clients to the ISP's network (this is not transit, just a connection to Bell's ATM network, IIRC). That leaves about $9 per customer to pay for everything else when you consider that TekSavvy charges $29.95 for their normal 5/800 service. In that $9, TekSavvy is able to provide 200GB/mth of bandwidth (5mbit DSL), and cover all other expenses, and still turn a profit. I don't see why a company like Sharebond can't make a profit on $10 or $20 per customer, as their actual bandwidth costs would be lower due to average usage. TekSavvy has proven that you can act as an ISP on those kinds of margins, turn a profit, and still manage to become the highest rated DSL ISP in North America (by DSLR's rating) :P Well you are comparing two different things. Assuming I understand this correctly, Shareband isnt leasing any LEC facilities or using any LEC infrastructure. They arent an ISP, but are an ancillary service you purchase in addition to paying your ISP. Given that Shareband operates at the end of a virtual tunnel, they in turn need to purchase wholesale IP access (not a connection to the LEC as TekSavvy does) in order to combine your pipes and provide and IP address to the end user. IP access, as I mentioned before, is far more expensive than a metro loop and can run up to $20k per gig. My question is how their pricing (which we dont yet know) and business model will keep them afloat!
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 GuspazGuspazPremium,MVM
join:2001-11-05
Montreal, QC
kudos:16 | That's the thing though, Bell wholesalers are responsible for maintaining their own connection. The $20.50 connection fee and $1300 GigE to Bell only gets the user's packets to the ISP (TekSavvy)'s network. From there, the ISP is responsible for getting the packets out to the internet at large.
They currently have six GigE lines to various providers (Cogent, Teleglobe, Internap, Peer1, etc) for that purpose.
My point was that if you eliminate the two Bell-related charges, and possibly some of the equipment costs required to connect to Bell, you're left with TekSavvy's $9 per month or so. Inside of that, they're able to cover all expenses and provide 200GB of actual IP transit. For $19 ($39.95 to customer, $19 is roughly left over after Bell takes their cut), they're able to provide unlimited services, targeted at users who use over 300GB per month (300-500 is probably typical).
If TekSavvy can make a profit, I fail to see why Shareband, with very similar costs once Bell is removed from the equation, couldn't do the same thing. | |
wifi4milezBig Russ, 1918 to 2008. Rest in Peace
join:2004-08-07
New York, NY | said by Guspaz:That's the thing though, Bell wholesalers are responsible for maintaining their own connection. The $20.50 connection fee and $1300 GigE to Bell only gets the user's packets to the ISP (TekSavvy)'s network. From there, the ISP is responsible for getting the packets out to the internet at large. They currently have six GigE lines to various providers (Cogent, Teleglobe, Internap, Peer1, etc) for that purpose. My point was that if you eliminate the two Bell-related charges, and possibly some of the equipment costs required to connect to Bell, you're left with TekSavvy's $9 per month or so. Inside of that, they're able to cover all expenses and provide 200GB of actual IP transit. For $19 ($39.95 to customer, $19 is roughly left over after Bell takes their cut), they're able to provide unlimited services, targeted at users who use over 300GB per month (300-500 is probably typical). If TekSavvy can make a profit, I fail to see why Shareband, with very similar costs once Bell is removed from the equation, couldn't do the same thing. Well, it remains to be seen. Lets see how this develops.
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