nitzanPremium,VIP
join:2008-02-27
kudos:2 | You say potato, I say.. taxpayer money! While I am very happy for Indiana folks who will be able to enjoy the benefits of fiber, let's think about this realistically.
$90mil investment in 29k potential customers. Let's assume 80% (high estimate) of them will actually use the service, so we're talking 23.2k customers, or $3879 per customer. Add loan servicing fees, interest, etc. and you're up and beyond $5000 per customer.
Assuming an average monthly revenue per customer of $100, minus operating costs - let's assume $30 for argument sake - we're talking $70 profit per month. So, to return the original $5000 investment would take almost 6 years.
One of three things will happen:
1. The company will go bankrupt.
2. The company will go bankrupt and "saved" by taxpayer money.
3. The loan will be "forgiven".
Either way, Indiana's FTTH will be paid for by taxpayer money. Not necessarily a bad thing - but call it what it is.
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Nitzan Kon, CEO
Future Nine Corporation |
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 bentand IngaPremium
join:2004-10-04
Loveland, CO
 ·Comcast
| If 50% of my cash has to go somewhere other than in my bank, it may as well go toward projects like this.
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»www.lp.org/issues/family-budget.shtml
"That government is best which governs least" - Thoreau |
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 BF69Premium
join:2004-07-28
Camden, TN
1 edit | reply to nitzan
said by nitzan:While I am very happy for Indiana folks who will be able to enjoy the benefits of fiber, let's think about this realistically. $90mil investment in 29k potential customers. Let's assume 80% (high estimate) of them will actually use the service, so we're talking 23.2k customers, or $3879 per customer. Add loan servicing fees, interest, etc. and you're up and beyond $5000 per customer. Assuming an average monthly revenue per customer of $100, minus operating costs - let's assume $30 for argument sake - we're talking $70 profit per month. So, to return the original $5000 investment would take almost 6 years. One of three things will happen: 1. The company will go bankrupt. 2. The company will go bankrupt and "saved" by taxpayer money. 3. The loan will be "forgiven". Either way, Indiana's FTTH will be paid for by taxpayer money. Not necessarily a bad thing - but call it what it is. $90 million is nothing. Also where do you live? So I can find out how many milions of MY tax $$$ your US house representative managed to secure for your district for bullshit projects over the last 10 years.
You assume the population will stay the same over time. Perhaps because of the availability of broadband more people will consider moving to these places. I know that when I consider a move if there isn't broadband I will NOT move there.
What business will move to a place without access to broadband? More business, more jobs thus more people needed to work those jobs. Pretty simple logic really. |
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nitzanPremium,VIP
join:2008-02-27
kudos:2 | said by BF69:What business will move to a place without access to broadband? More business, more jobs thus more people needed to work those jobs. Pretty simple logic really. I wasn't debating whether it's a good or bad idea to develop infrastructure for these folks. What I *was* debating was that if it's going to be funded by taxpayer money, call it taxpayer money - not a "loan" which will never be repaid.
I hate to break it to you, but broadband is NOT a major factor in what makes "normal" people choose a place to live. Yes- I would NEVER live anywhere broadband is unavailable, and neither will you. But when I think about my family and my friends, broadband is something they look at AFTER they already moved. They wouldn't even think to check what the options are until it's too late.
So while you're right and a few people from neighboring locations will move over just to get FTTH - I don't think we're expecting a major population shift in Indiana anytime soon.
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Nitzan Kon, CEO
Future Nine Corporation |
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BF69Premium
join:2004-07-28
Camden, TN | said by nitzan:I wasn't debating whether it's a good or bad idea to develop infrastructure for these folks. What I *was* debating was that if it's going to be funded by taxpayer money, call it taxpayer money - not a "loan" which will never be repaid. And you KNOW for a FACT it won't be rapid because.......if you don't have proof I suggest refraining from stating opions as facts.
I hate to break it to you, but broadband is NOT a major factor in what makes "normal" people choose a place to live. Yes- I would NEVER live anywhere broadband is unavailable, and neither will you. But when I think about my family and my friends, broadband is something they look at AFTER they already moved. They wouldn't even think to check what the options are until it's too late. Well I'm not sure I like the insuation that I am NOT "normal", but anyways. Yes my best friend moved a few miles out of town only realized AFTER he purchased his house dial-up is his only option. So now he and his kids fall further behind. Me and you may be in the minority now, but it won't be long before people look at broadband options as they look for other things. Before DirectTV came about how many people refused to move to places because it lack cable? Quite a few. Now people consider the boonies because they have more than just 5 channels to watch. Now that internet is becoming ingrained like TV has the same type thing will happen.
So while you're right and a few people from neighboring locations will move over just to get FTTH - I don't think we're expecting a major population shift in Indiana anytime soon. You are also forgetting that businesses that may never have considered an area might now. If that if a new business provided several hundred jobs then the effect on the local area would lead to an increase in population. |
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said by nitzan:While I am very happy for Indiana folks who will be able to enjoy the benefits of fiber, let's think about this realistically. $90mil investment in 29k potential customers. Let's assume 80% (high estimate) of them will actually use the service, so we're talking 23.2k customers, or $3879 per customer. Add loan servicing fees, interest, etc. and you're up and beyond $5000 per customer. Assuming an average monthly revenue per customer of $100, minus operating costs - let's assume $30 for argument sake - we're talking $70 profit per month. So, to return the original $5000 investment would take almost 6 years. One of three things will happen: 1. The company will go bankrupt. 2. The company will go bankrupt and "saved" by taxpayer money. 3. The loan will be "forgiven". Either way, Indiana's FTTH will be paid for by taxpayer money. Not necessarily a bad thing - but call it what it is. Farm subsidies based upon the size of your land plot makes little sense either, yet millionaires get paid money to grow or not grow crops based upon how the wind blows in Washington DC... so, what's a little broadband misadventure in the grand scheme of things.. so long as there are massive fiber builds in the midwest.. my traffic to destinations west in the USA get closer to my expected upload/download caps... i'm all for it... build that fiber.. big telephone and cable companies can't own 100% of the customer base.. and it's been their intention all along that 2 companies/providers NOT own 100% of the infrastructure & customer base. so, lets get to work and run that fiber like we do electric lines, sewer lines & telephone lines... far and wide.. not leaving one spec of dust where you can "get away from it all"... it is the 21st century you know.. |
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nitzanPremium,VIP
join:2008-02-27
kudos:2 | said by littledoweknow :
big telephone and cable companies can't own 100% of the customer base.. and it's been their intention all along that 2 companies/providers NOT own 100% of the infrastructure & customer base. Totally agree. As long as the rural telco doesn't go bankrupt and get bought (along with the taxpayer-paid-for fiber) to be owned by a major telco.... |
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