en102
Canadian, eh?
join:2001-01-26
Valencia, CA | reply to TKJunkMail
Re: The real answer is...Yes...and No
Hasn't Comcast been producing high profits for the last few years ?
In general - I agree, investors want (demand?) a decent ROI, and why would investors pump money into something that will not bring a decent return. |
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TKJunkMail
Enjoy the sun
Premium
join:2002-03-03
Avalon, NJ
 ·Sprint Mobile Broa..
 ·Comcast
| said by en102  :Hasn't Comcast been producing high profits for the last few years ? Profit $'s yes. But their profit percentage on revenue was 4% and their Return on Assets was only 1%.
They have large revenues, but the cable industry has huge capital costs(in their infrastructure) and in operating costs to maintain that infrastructure. So profits are not any where near excessive. The profits are barely enough to keep investors from fleeing to other opportunities.
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en102
Canadian, eh?
join:2001-01-26
Valencia, CA
·RoadRunner Cable
 ·DSL EXTREME
| You'll also find that most packages (bundled tv/hsi or phone/dsl) are not that different in price with the exception of intro pricing. When I was on Comcast, they were more expensive than POTS/DSL/DirecTv on every service except for digital phone, where their price was the same.
TimeWarner is more competitive, where their TV service (digital) is pretty much the same as DirecTv, and they have a lower priced tier for HSI (1.5/384), and offer bundle incentives. I can assume that the 'average' person (not highschool age, or gamer) doesn't need the 8Mbps/768kbps package. I do remote work on VPN/SSH/X-11/Remote Desktop, and 2.5Mbps/512kbps is fine for me... and I've been doing this for 3 years.
Having high availability tiers for those wanting to pay $$$ is a good revenue generator, especially if it isn't that difficult to implement. Having a low/basic tier for some (cable) is difficult, as they don't _really_ want low end options. |
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NEP1611
join:2002-03-27
Northford, CT
| reply to TKJunkMail
I do think this guy is right, to a point. Regardless of how many players are in the game, people are still going to want ESPN and other high demand channels. These channels cost money, and it is not realistic to expect the cable and satellite companies to absorb the cost.
What this guy failed to mention is that in fact there already IS competition, in the form of DirecTV and Dish Network (setting aside whether some specific households may not have access to satellite) Adding another player at this point in the form of the telcos will not decrease prices, their effect would be to provide an additional option for customers.
Where the real benefit will be is as far as services provided. Companies may be more aggressive in rolling out high-definition DVRs, for instance, or bidding for exclusive rights on certain programming.
Regarding prices, what everyone forgets is that both the cable companies and satellite companies have various packages that are targeted at different price points, and they each offer a different mix of products. If you want to spend $50 a month on pay TV, chances are there is an option that is viable, if not exactly what you're looking for. |
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