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big_e

join:2011-03-05
Reviews:
·Comcast

$5416 dollars per customer acquisition cost

That's interesting. Here we have a telecom paying $5,416 dollars per customer for a merger, yet the typical attitude in this industry is that spending the same amount of money or less per customer for building out FTTH, or extending service to rural customers is deemed too expensive and not a good enough ROI. It's only money well spent when it goes straight into another a cable company's pocket.


TBBroadband

join:2012-10-26
Fremont, OH

cable companies are not telcoms. they're MSOs. Totally different industry/term.


elray

join:2000-12-16
Santa Monica, CA
reply to big_e

Don't confuse acquisition cost per paying customer with build cost per address passed.

FTTH yields take rates of 30 percent - at $4K/address, thats around $13K per customer.

Charter bought on the cheap.


big_e

join:2011-03-05
Reviews:
·Comcast

Are you sure you don't have the numbers reversed? Most estimates I've seen put the cost to pass for FIOS at $700 per home with a cost of 4K per paying customer.

»www.nytimes.com/2008/08/19/techn···nted=all

In 2006 in NJ the cost to pass is $846 per household with an additional cost to connect of $900.

»www.state.nj.us/rpa/docs/white-paper.pdf


tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
·ooma
·Optimum Online
·Verizon FiOS
reply to elray

said by elray:

Don't confuse acquisition cost per paying customer with build cost per address passed.

FTTH yields take rates of 30 percent - at $4K/address, thats around $13K per customer.

Charter bought on the cheap.

And yet ANOTHER reason why Verizon jacked up rates.. now $94.95 for entry-level triple play and climbing (Price is right yodeler continues climb up mount Verizon) Sure, price is right for shareholders and profiteers... PFFT!!

»www.youtube.com/watch?v=DSAeyAV85UM

tanzam75

join:2012-07-19

1 edit
reply to big_e

said by big_e:

That's interesting. Here we have a telecom paying $5,416 dollars per customer for a merger, yet the typical attitude in this industry is that spending the same amount of money or less per customer for building out FTTH, or extending service to rural customers is deemed too expensive and not a good enough ROI.

It costs less than $5,416 per customer to build out FTTH.

The problem is that once you've finished building it, you start with no subscribers. It might take several years to get to your anticipated take rate. Meanwhile, you're paying interest on the bonds, lighting up the equipment, etc.

In contrast, Charter bought a fully-functioning cable system, with subscribers already in place. The day the merger closes, Charter starts collecting revenues from all of those subscribers. That's why they're willing to pay more per cable customer than for a new FTTH build.

elray

join:2000-12-16
Santa Monica, CA
Reviews:
·Time Warner Cable
·EarthLink
reply to big_e

said by big_e:

Are you sure you don't have the numbers reversed? Most estimates I've seen put the cost to pass for FIOS at $700 per home with a cost of 4K per paying customer.

»www.nytimes.com/2008/08/19/techn···nted=all

My nose is wrinkling. If its $4K/sub, not per address, VZ would be foolish to quit; rents on the 30% take rate (premium buyers, immune to price), minus the union overhead, should be sufficiently attractive to continue expansion. While LTE will be a competitive threat, it won't affect the Fios set.