On Sun, January 20, 2008 11:40 pm, Andy Davidson wrote:
> Thanks to the pricing model imposed on last-mile
connectivity imposed
> by the incumbent, it costs an ISP US$471/Mbit to send
data to my
> customer[1]. Maybe the same data that's just come all
the way from Oz
> through my transit for US$10.
That would imply that either:
- There's an opportunity in the market to provide competing
(cheaper)
last-mile infrastructure
- It really *does* cost that much to provide the last-mile
connectivity
In actual fact, the last-mile is cheap (at least for the UK,
the incumbent
is forced to let you have access to the copper at a fairly
reasonable
price); the business challenge is in balancing the cost of
CO equipment
and backhaul against revenue from customers served by that
CO.
Of course, the supplier for facilities at the CO, and quite
likely
backhaul from it, is the same incumbent; wearing a cynical
hat, I might
suggest that they are trying their best to make the
situation seem more
like the second option than the first.
Putting your own gear out to the CO has some other wins too
- you can
control your own contention ratios (and, depending on the CO
equipment,
sell *different* contention ratios to different customer
types), if you
have L3 equipment on site then local customer-to-customer
traffic doesn't
touch your backhaul, and you get to deploy your own choices
of technology
at your own pace (SDSL, Annex M, EFM, VDSL, etc).
Regards,
Tim.
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