said by wwdubbia :

and it would be safe to assume that these costs would go down due to the caps. e.g. less customers = lesser need for technicians/truck rolls

said by OverModded :

How about gasoline prices?
How about the cost of electricity in Calif a few years ago?

said by jjeffeory :

$3 BILLION??? Sounds freaking fantastic to me.

said by RR User :

How would you feel about paying 3-4x more on your electric, gas or water bill? Or what about paying 3-4 times more for that car you just bought. What about having your mortgage or your food bill quadruple?

You never see increases that dramatic on any other common service, so why should we see it on broadband?

said by Skippy25 :

And you don't just want profit, you want it here and now and will sacrifice tomorrow to make a buck today.

quote:

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Not true. Most investors want to maximize profits over a period of time. They don't look for an immediate return at the expense of steady long term returns.

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Worse comes to worse, you just pull your money out of one company and shove it in another as you can care less where you make your money

quote:

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And you would leave your hard earned money in a company that never turns a profit, purely out of altruism for the employees & society? Don't make me laugh!!

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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?

said by DGLewis :

And those indirect costs scale not with traffic, but with number of customers. The number of trucks, technicians, and call center workers you need doesn't change whether your customers are using 10 GB/month, 100 GB/month, or 1000 GB/month.

said by jimbo2150 :

Now lets factor it competition into your equation. No/little competition means there is little/nothing to offset that excessive price.

said by jimbo2150 :

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.

said by espaeth :

The 10K balance sheet only shows direct costs (power, hardware, maintenance, vendor fees) and not indirect costs like operating the service vehicle fleet, developing tech training programs, paying employee salaries + benefits, call center operation costs, etc.

said by DGLewis :

And those indirect costs scale not with traffic, but with number of customers. The number of trucks, technicians, and call center workers you need doesn't change whether your customers are using 10 GB/month, 100 GB/month, or 1000 GB/month.

said by espaeth :

The 10K balance sheet only shows direct costs (power, hardware, maintenance, vendor fees) and not indirect costs like operating the service vehicle fleet, developing tech training programs, paying employee salaries + benefits, call center operation costs, etc.

said by jimbo2150 :

What about greed? $1/gb is not excessive greed? $0.20/text message is not excessive greed?

said by Metatron2008 :

Why would a margin 1000's of times be bad to the consumer if they are willing to pay it?

said by jimbo2150 :

Such an easy way to attempt to say nothing is greed. I can certainly ask the same question... what exactly is NOT greed? 800% pofit? 8000%?

So why is to SOOOOO bad to have a profit aimed at giving decent consumer products and make a decent return 5 years in vs. 0.5 years in? I don't know why so many companies seem to think that if they are not making an immediate return, it should not be done or it is the wrong way to go. When did instant gratification become part of business?

Edit: Also, what about COMPETITION?? They do everything to keep it out and in the Internet business there seems to be very little in most places in the U.S. (with exception to very large metro areas).

said by jimbo2150 :

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.

said by Lazlow :

It is from TWC's 10K, usually pages 60 and 89.

»investing.businessweek.com/resea···ype=10-K

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.

said by OverModded :

And what exactly is greed?

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)

said by RARPSL :

You are confusing the speed that the user can move data with the volume of data that they can move. A higher speed tier has nothing to do with how much data you can move - Only how long it will take you to move it. Unless you want to move more data then a slow tier can handle if used 24/7, all switching to a faster tier does is decrease the amount of time it takes to move the same amount of data.

said by jimbo2150 :

This is exactly the kind of poor thinking of companies and those who support it today. ONLY being dishonest is anti-consumer? Falsifying data (which is what most are doing now) to support their own agenda is not dishonest? What about greed? $1/gb is not excessive greed? $0.20/text message is not excessive greed?

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)

said by S_engineer :

Rollover bandwidth...theres an idea. Although you'd have the same congestion at peak times now!

said by jimbo2150 :

What about greed? $1/gb is not excessive greed? $0.20/text message is not excessive greed?

I am all for companies making money, but legitimate money.

said by delltechkid :

All of the indirect costs you mention would exist even if they didn't provide HSI, as they must have these for TV. Sure there are a few extra people that they might of had to hire to cover the people who buy only internet, but I'm sure the majority of their HSI customers probably have cable TV as well.

said by Matt :

Just like Time Warner didn't want to introduce RR Lite or RR Basic but they wound up being wildly successful, you introduce a new tier, let's call it the Granny Tier, that is based on usage billing. You make it 100% usage based (never happen) or you charge $9.99 month + usage.

Then, if people want more speed, but a cheaper monthly price than the unlimited plans, maybe offer a higher speed tier. Price the unlimited at $29.99 a month like it is, but price the usage at $19.99 + usage. You'll inevitably catch people with overages, but you'll at least give them a choice and won't penalize your customers who are comfortable with their current plan or simply don't want to watch their usage.

said by Matt :

There is if you try to do it in a dishonest way that is extremely anti-consumer.

said by Matt :

I still think you have to give people the option of keeping their existing plans with no limits. I know personally, I'd pay a bit extra to not have to worry about monitoring my usage. If you have people who abuse it (the frequently touted "bandwidth hog") then you take appropriate action.

If it really is only 1% of their user base, how hard would it be to move them to a higher tier or force them to move to usage based billing? If they are really costing the company so much money, you'd solve two problems, one, they'd stop using so much which saves you money, or two, you generate more revenue from that customer. Either way (Whether you believe a customer not using as much data even saves them money or not. I don't.) you solve the problem you are parroting.

said by S_engineer :

But that wouldn't lead to the revenues they seek. There were alot of watered down alternatives, however TW shot for it all at once.

said by OverModded :

It is possible to devise a revenue neutral tiering plan with appropriate overage fees so that 95% of your customers would see no difference at all in their monthly costs. And for those in the highest speed/usage tier(those heaviest 5% users), heavy usage would lead to the appropriate extra costs in overage charges.

said by OverModded :

It is possible to devise a revenue neutral tiering plan with appropriate overage fees so that 95% of your customers would see no difference at all in their monthly costs. And for those in the highest speed/usage tier(those heaviest 5% users), heavy usage would lead to the appropriate extra costs in overage charges.

said by Lazlow :

Matt

They really cannot justify it.

said by Matt :

While some here would argue that metered billing in ANY form is bad, it can be a positive thing if implemented properly. How is that you ask? Well, for starters, you don't move every tier to metered billing nor do you make it so a customer has to spend 300% more a month to keep the same product they currently have.

said by Lazlow :

They really cannot justify it. Just look at TWC's 10K. The cost of Revenues for HSI was $146 million(page 60) but the Revenues generated by HSI was $4.159 Billion (page 89).