osewalrus (osewalrus) wrote,

Link Harvest: Broadband Capacity tiny portion of you bill

This article summarizes this article by Dave Burstien on the actual cost of bandwidth to broadband access providers. Burstein concludes that the cost of additional bandwidth to accommodate such things as Netflix is extremely cheap and only constitutes 2%-5% of your total broadband bill.

Burstein's figures go against the eternal Song of the Exaflood, the prediction that the Internet is about to collapse unless we do whatever it is the people predicting the Exaflood want. For example the delightful yet unintentionally ironic video from 2007 (ironically available on YouTube) predicted that the Global Internet would collapse in 2010 unless we kept the broadband providers happy. However, Burstien's calculations are much more in keeping with actual network economics, the overall decline in the cost of enterprise bandwidth (as opposed to residential bandwidth) and the fact that Comcast reported on its most recent quarterly earnings call that it has an astounding 98% profit margin for each broadband subscriber.

UPDATE: Stopthecap has another look at AT&T specifically and why they feel the imposition of the cap is not justified. http://stopthecap.com/2011/03/14/stop-the-cap-investigates-atts-justification-for-internet-overcharging/?utm_source=twitter&utm_medium=social&utm_campaign=Stop+the+Cap!+Investigates+AT%26T%27s+Justification+for+Internet+Overcharging

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