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How Much Should Broadband Cost?
An anonymous reader writes "The difference in cost between broadband options seems to be the primary motivator for consumer spending, reports News.com. Frugal consumers are opting for the lower-priced DSL options, while those with more money to spend on services are opting for cable modems." From the article: "A year-and-a-half ago, pricing of DSL and cable modem service was roughly the same. But over the past year, the phone companies have launched an aggressive assault by dropping prices. At the end of 2005, the average price of DSL service was about $32 per month, roughly $9 less than cable, according to research firm IDC. AT&T has twice lowered the price of its DSL service and now offers its 1.5Mbps service for $12.99 for the first year."
These low prices are only to gain market share, and things will change. I think it should cost as much as the consumer is willing to pay - at least that is how it works when you have a properly working capitalist system. But you see, the large telcos and cable companies have co-opted the system, and now are using legislation, and unfair practices to keep any competition from getting into the market. When is the last time you saw a new DSL provider *other* than the phone company? I am really worried that our options are getting smaller, and not larger - thus the prices will go up, and our bandwidth will not increase with the extra cost.
In that same vein, I feel that their next step is to start trying to sand-box their corner of the Internet. That way they control the content too. It is no good as a commodity to them, they want to monetize it to a greater extent. The only way in their eyes it to first keep you from going anywhere else, second make it so their content and services are always faster, and better. Look at what some of them do already with VOIP. When my VOIP provider is choppy, and high latency who do I blame? Most customers are not smart enough and blame the VOIP provider.
Remote Admin Tools for Windows
I currently pay £34.99 per month for my 10Mb connection from NTL here in England.
Even though its more expensive than ADSL, W00000t is all I can say!
I prefer my cable because ADSL still appears to dialup and the IP changes every time you sneeze.
The ethernet cable out the back of my machine is designed for super quick data connections and thats exactly what it does.
As an example:
I just downloaded Ubuntu (697.8MB) over http in under 10minutes, ~1200kB per second is nice.
as a FYI for other NTL broadband customers get a cable modem the set top boxes cannot handle 10Mbit (but NTL will be happy to take your money anyway).
liqbase
£24.99 for 512/256.
:)
But I stick with them because they have decent fast newsgroups with all the binaries. I'm talking about you, Zen.
I rang up though, and asked for IPv6 connectivity. They said they didn't do it because there was no demand for it. I said, "Well, now there's demand for it", and they said that that didn't count.
Next UK ISP with native IPv6, and newsgroups with binaries, and I'm off. You hear that, Zen?
Get your own free personal location tracker
Most neighborhoods have a free wireless broadband provider... Apparently called "Linksys"...
"At the end of 2005, the average price of DSL service was about $32 per month, roughly $9 less than cable, according to research firm IDC."
DSL is still more expensive than cable unless you have a landline already. Home telephone service is around 40$/month here, which would make DSL (assuming I could get 32$/month anyway, which seems low) that would put me at over 70$. Compared to cable which is under 60$ and comes with "free" basic cable, since there's no way not to pay for that too.
I've already got a cellphone and don't have any use for a landline. Maybe if the DSL providers were actually any better than comcast (local cable monopoly), but until they are it's not worth the extra cash.
The Farewell Tour II
Let's see what 29,99 can get you in France:
24mbit internet
WIFI MIMO router/set-top box, 1gb webspace
Telephone line fees included, you really have nothing else to pay
Unlimited free national and international POTS phone
200 digital TV channels over DSL, HDTV and DVB-T compatible terminal included..
This one company litterally drove the prices down and the offerings up.. Now that the prices are low enough, everybody is catching up on triple-play. They also have other plans, like building a mesh of wifi hotspots using their set-top boxes to route free wireless VoIP calls. Free cell phones, just imagine that..
In a properly working market, the price is the determined by the costs of the sellers, not the desires of the buyers. In most circumstances, this means marginal cost plus fair return on investment.
whoever taught you your economics, they should be fired.
the price is determined by the desires of the buyers first, with the costs of the sellers a close second.
You cannot market a product nobody wants, or a product everyone wants out of their price range or they dont buy, plain and simple, and thus the market collapses.
Further, if you are not pressured by consumer needs and competition for those needs (e.g. if a monopoly or oligopoly is presently stifling competition) there is no reason to develop greater efficiency and lower those costs. Therefore the consumer suffers, they do not get optimal service for their dollar, and arguably the producer and even the environment suffer, as they are not making efficient use of their inputs.
VLC FOR MAC IS DYING! IF YOU DEVELOP, PLEASE SAVE IT!!
/*This is because the COST of providing water is very low, and competition assures that the price tracks these costs.*/
Huh? How is there competition in the water market? In most every city, there is a single provider working under a government enforced monopoly. The water market is probably the single most regulated market in the nation.
Also, if the cost of water reflected the costs of providing it, users in Phoenix, AZ would pay more than users in Buffalo, NY. This is currently NOT the case. The fact is, the price of water usually reflects the government subsidies, rather than actual market costs resulting in huge inefficiencies, and excessive depletion of groundwater supplies in many parts of the West.
We all know what to do, but we don't know how to get re-elected once we have done it
Why cable companies haven't changed their marketing to reflect this, I have no idea. Behind the times, I guess.
--triv
Just got of the phone with FIOS (verizon) - for 34 dollars they can get me a nice fast completely non-functional DSL connection. Of course to get what this geek really REALLY wants (simple, static address - ToS that allow me to run services) will cost 99.95 a month for the same upload speed.
Idiot on the phone line couldn't justify the 60 dollar cost difference, other than to say that is the price difference between static and dynamic IP (well, the download speed on the static was a little faster - They couldn't price out a static address on the slower speed).
This was all started by Verizon sending a flunky to my door saying they were REQUIRING me to change to FIOS. Was a fun discussion with said flunky -
"Will you allow me to run a service"
"What do you want that for"
"So I can run my e-mail server"
"We provide an e-mail service"
"No you don't"
etc. etc. etc. Turns out they really were just looking for upgrade oportunities - wonder how many of my neighbors fell for it (I know one didn't because said flunky said the guy down the street was asking the same questions
"The one with the Dogs?"
"Yeah, how do you know"
"Because he is a system admin - and he is smart"
I have mod points and I am not afraid to use them
-1, Neener Neener Neener.
Over the past three years I've received two letters from SBC notifying me that my DSL rates are increasing. Meanwhile I've noticed that the rates for the first year of service have steadily dropped. I used to think that I was just getting hammered because here in Dallas, my options were pretty much limited to SBC and Comcast (with a touch of Earthlink and a couple of more expensive options). Nope. My parents in Spokane suffered a rate increase in the past year. My sister in San Francisco had a rate increase in the past two years. My brother in New York has also experienced a rate increase recently. Meanwhile while (unsuccessfully) looking around for a new provider, I've noticed that the rates for the first year of service have steadily dropped (just as the article claimed). The ISPs are monopolistic crack dealers - and they know it. For being a free market, I don't feel so free.
good points, but actually, we can either have a sharp demand/supply curve, or a flat one, or a moderately sloped one.
...
in some markets, we may find that the desires of the buyers are the most significant in determing the price of the service (broadband, considering different flavors/brands/speeds).
in other markets, we may find that the lack of competition amongst competitors (places where the same large corporation owns the cable, wireless, and DSL services or reaches a colluding anti-competitive market agreement in our under-regulated market) means that the price is determined by the sellers and their most efficient return on investment (an example being renters where most apartment buildings are owned by the same conglomerate or are dorm rooms owned by a specific college).
and then other markets may be inbetween these two extremes.
Assuming there isn't a monopoly or oligopoly in our current environment will lead one to inaccurately assume perfect competition, with easy barrier of entry (they may only permit one cable provider or provide barriers to cell towers or land lines for DSL), perfect information (knowing what the current and future rates are and consumers having easy access to information to determine the actual true cost (both teaser rate and lock-in rate and cost/length of service contract and installation/disconnect fees)), and perfect liquidity of capital with sufficient equivalent capital for all consumers.
Such a perfect world (the latter case) doesn't exist anywhere I've seen. Thus, we need to use a better economic model, assuming imperfect information for competitors (no published rates), sticky prices (regulator sets levels), imperfect information for consumers (only teaser rates seen and fine print obscuring full cost so what you think is $15 is really $200 when you install), and high barriers to entry (restrictions on building, long permit schedules, long wait times for new installations, lack of supply for materials to install, shortage of contractors to install, etc).
In other words, you're both right. And you're both wrong.
remember, if you get two or more economists in a room, you'll get a number of different answers equal to the number of economists in the room
(grin)
-- Tigger warning: This post may contain tiggers! --
Only if they are all one-armed economists, so that none can say, "On the other hand...".
I see even classic Slashdot is now pretty much unusable on dial up anymore.
No, actually he's only half right. It's a long aged discussion (177x?) about the differences of intrinsic values. How many pounds of diamonds will you pay for a glass of water? What if you have been in the desert for a week? But without the demand (desert) the product (water) has little perceived value.
The biggest problem with this whole picture is that the market availability of DSL versus Broadband is severely warped and everyone knows it. But we are unable to get the congress-critters to recognize that it's really problem at the consumer level. I can't get DSL for love or money. But I can get this expensive broadband that is only offered by one company. No choices.
I'm becoming a fan of DSL being applied to the United States in the same fashion that the Rural Electification Act was used. It required that EVERY house have electricity. I think it should be required that every house which currently have a phone line also have DSL made available at a consumer price that is consistent. You can't charge the guy with a 12 mile special line $599.99 a month and $9.99 in the big city.
But I don't think this will happen in these times. 10 years ago I was of the opinion that the Federal Government should gaurantee delivery of a TCP/IP connection in the same manner that the US Post Office works. I still am.