Lazlow
join:2006-08-07
Saint Louis, MO | reply to fAcEtIOUs
Re: Metered Billing Has Its Place Tk
Lets say, for the sake of argument, that Espaeth has a point and we move the total HSI revenue cost from $146 million to an even $1 Billion, which should cover ANY imagined costs. You are still making over four times as much as your costs. I do not hold it against any company to make an honest profit, but can you really say that anything over 100% profit is honest? ($4.159 - $1)/$1=316%(profit) |
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Reviews:
 ·Charter
 ·Clearwire Wireless
1 edit | said by Lazlow:Tk Lets say, for the sake of argument, that Espaeth has a point and we move the total HSI revenue cost from $146 million to an even $1 Billion, which should cover ANY imagined costs. You are still making over four times as much as your costs. I do not hold it against any company to make an honest profit, but can you really say that anything over 100% profit is honest? ($4.159 - $1)/$1=316%(profit) I don't see a problem with it, as long as customers keep paying it and WANTING to pay.
The TWC CEO must be a complete idiot, if you are making that much revenue, why piss off your customers?
Make a few network upgrades, add new speeds, make people pay more for the new speeds! Not piss them off, lose customers and business.
When did executives forget how to treat customers? You are supposed to kiss their ass, make them feel good, even if you aren't going to fill their needs... |
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 MattAll noise, no signal.Premium
join:2003-07-20
Jamestown, NC
kudos:12 | reply to Lazlow
said by Lazlow:Tk Lets say, for the sake of argument, that Espaeth has a point and we move the total HSI revenue cost from $146 million to an even $1 Billion, which should cover ANY imagined costs. You are still making over four times as much as your costs. I do not hold it against any company to make an honest profit, but can you really say that anything over 100% profit is honest? ($4.159 - $1)/$1=316%(profit) Most companies that I have worked for would consider a profit that is 4 times documented costs as a pretty terrible margin. You simply can't expand with that kind of limited revenue flow and the subsequent cash reserves it would allow for.
I think you'd be surprised to know that most companies have profit margins that are 1000's of percentage points higher than the physical cost. |
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Lazlow
join:2006-08-07
Saint Louis, MO | reply to Metatron2008
Lets flip this around a little bit. Lets compare the video numbers. Cost of Video Revenues $3.75Billion, Video Revenues $10.5 Billion. Now keeping Espaeth point in mind we will add the same $.85 Billion we did for HSI.
3.75+.85= 4.6
(10.5-4.6)/4.6=128%(profit)
So I think disparity in percent profit shows that it is about how much they can convince the user to pay versus what it costs. |
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MattAll noise, no signal.Premium
join:2003-07-20
Jamestown, NC
kudos:12 | Lazlow, can you please provide the link to where you are getting your numbers? Thanks. |
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Lazlow
join:2006-08-07
Saint Louis, MO | It is from TWC's 10K, usually pages 60 and 89.
»investing.businessweek.com/resea···ype=10-K |
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| reply to Matt
said by Matt:I think you'd be surprised to know that most companies have profit margins that are 1000's of percentage points higher than the physical cost. And my entire point is... why? Why do they have to have an immediate return at the expense of their customers? What ever happen to long-term investments? And why is it seen as such a bad thing that a company not make a 1000+% profit margin when they could make a 100%. It may take a bit more time for a full return but it would most likely come.
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- "Techie" Jim |
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| reply to Lazlow
And if you look at the overall revenues - costs(excluding a one time charge of $14.8 billion, their profits are not overly high.
Their revenues for TWC were approx $17 billion and the costs were $14 billion. So they made $3 billion on $17 billion in revenue. A 17.6% return.
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 jmn1207Premium
join:2000-07-19
Ashburn, VA | reply to jimbo2150
Impatient, short-sighted investors are the culprits behind some of the lousy business decisions we see all the time. |
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Reviews:
·Charter
·Clearwire Wireless
1 edit | reply to jimbo2150
said by jimbo2150:said by Matt:I think you'd be surprised to know that most companies have profit margins that are 1000's of percentage points higher than the physical cost. And my entire point is... why? Why do they have to have an immediate return at the expense of their customers? What ever happen to long-term investments? And why is it seen as such a bad thing that a company not make a 1000+% profit margin when they could make a 100%. It may take a bit more time for a full return but it would most likely come. Why would a margin 1000's of times be bad to the consumer if they are willing to pay it?
That's just making money. If the customer refuses, making them pay it is monopolistic greed.
But hey, if the customer wants to pay it, why stop them?
In all honesty, their is a large difference between keeping the customer happy, and letting them have a choice, versus being a hippy who wants to share the wealth. |
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| said by Metatron2008:Why would a margin 1000's of times be bad to the consumer if they are willing to pay it? Now lets factor it competition into your equation. No/little competition means there is little/nothing to offset that excessive price. It means the consumer has little option besides pay it or drop the service (supposing they are not locked in a contact and have to pay early term fees).
The same companies charge excessive rates to allow others to use their network. Well out of the viable competitive range. THey constantly try to prevent competition and even a community's attempts to create competion (either through a local/private network, wireless, or other).
And in the end the consumer has no voice. Stinks to high heaven of greed to me.
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- "Techie" Jim |
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MattAll noise, no signal.Premium
join:2003-07-20
Jamestown, NC
kudos:12 | reply to jimbo2150
said by jimbo2150:said by Matt:I think you'd be surprised to know that most companies have profit margins that are 1000's of percentage points higher than the physical cost. And my entire point is... why? Why do they have to have an immediate return at the expense of their customers? What ever happen to long-term investments? And why is it seen as such a bad thing that a company not make a 1000+% profit margin when they could make a 100%. It may take a bit more time for a full return but it would most likely come. I don't mean on the value of their stock. The point of such a high profit margin is to allow for investment in expansion, to better the service, as a safety net for the unexpected. There are numerous reason that successful companies must have such a large profit margin and really require one to operate. Apple has what, a 600% profit margin on the iPhone by most estimates? (That's probably on the low side too.)
When you start talking about huge corporations like Time Warner, that percentage can shrink because that percentage of profit is simply a much larger sum of money. You see that in the executive compensation packages. CEO, CTO, CFO's all figured out if they can eek out 2 points on their stock value by cutting costs, they directly stand to benefit. It may not be much to the profit of the company, but it's still a huge sum of money to an individual. After all, what is $28 million if you had a net profit of $7 billion? That's only .4% of said net profit.
However, that $28 million could have upgraded half your market to DOCSIS 3.0. So a lot of what you see is the result of impatient stock holders who want an immediate return. They are not the majority of the smart investors out there however. They came to the forefront when the day trading phenomenon became prevalent. When you couple that with the greed of an executive, little to no competition, and no oversight by an impartial party, you get what we have now. Greed run rampant in the from of anti-consumer practices. |
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MattAll noise, no signal.Premium
join:2003-07-20
Jamestown, NC
kudos:12 | reply to jimbo2150
said by jimbo2150:Now lets factor it competition into your equation. No/little competition means there is little/nothing to offset that excessive price. That is exactly right and why I am so infuriated by this entire fiasco. Time Warner is rolling this trial out in markets with little to no competition. Why aren't they rolling this out in their competitive markets where they face FiOS? Isn't THAT where they should upgrade to DOCSIS 3.0? |
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| reply to fAcEtIOUs
hey TK...would you then mind or be in favor of the gov't taxing the user on a per GB basis? |
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| reply to Matt
said by Matt:That is exactly right and why I am so infuriated by this entire fiasco. Time Warner is rolling this trial out in markets with little to no competition. Why aren't they rolling this out in their competitive markets where they face FiOS? Isn't THAT where they should upgrade to DOCSIS 3.0? And the low caps to go with it. Will it really be usable for anything other than email? Personally, I am not sure what TW is actually thinking to begin with.
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- "Techie" Jim |
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| reply to fAcEtIOUs
$3 BILLION??? Sounds freaking fantastic to me. |
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| said by jjeffeory:$3 BILLION??? Sounds freaking fantastic to me. The percentage is the relevant number, not the amount. |
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| Would you be in favor of taxation on a per GB basis. That would be the next step in the evolution of billing for broadband services!
You may think it's far fetched, but 2 years ago so was the idea of metered billing.
This is a consumer fight that has broad implications. |
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approval from:
fAcEtIOUs 
| reply to jimbo2150
Just out of curiosity, which companies have you worked for? I have been in business over 15 years, and I have yet to see a company with profit margins in the 1000's of % over cost. Think about it, if a car costs $15k, then you are saying that the 'physical cost' would only be in the $1500 range? I don't think so. I have worked in the automotive support industry. |
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