said by cooldude9919: said by FFH5: said by karlmarx:
Repeat after me. There is no cost to move a byte of data. Period. But, once you've invested the CAPITAL, the operational cost is effectively ZERO.
Repeat after me. YOU ARE WRONG. And saying your error over and over again doesn't make it correct. There is costs to moving data.
I dont agree with the per byte billing method, but TK is correct there is a cost somewhere, though in some cases it isnt as much as you would think.
Each tower has to have a backhual of some method, weather it be a crapton of t1's (that att pays themself for), some kind of metro-e fiber circuit (verizon uses charter in some places for exmaple) or some microwave link (captital expense).
Most of the costs are in capital investments which will be fixed costs (Karl has stated that variable costs are small). Since most of the costs are fixed, the total cost will remain about the same (if variable costs are indeed small as Karl stated) wither customers use the equipment or not.
So, whats really going on? Simple, the capital investment is so large that AT&T has to over subscribe their capacity and hope for the best. The problem is all these iPhone customers using their data on a system that cant handle the load. This is impacting customers experience and satisfaction. Not to mention it gives Verizon ammunition to use in ads. The quick fix is to ration the bandwidth by charging per usage. The proper fix is to invest in more equipment.