Quantcast Cheap Ass Gamer - View Single Post - CAGcast #133: Steal This!
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Old 09-15-2008, 04:05 PM   #45
I disagree with Cheapy's assumption that bandwidth will get cheaper over time. He is using a consumer retail analogy that doesn't match the ISP business. With hardware and manufacturing, you have economies of scale to offset costs. To increase bandwidth, the only recourse is to install more and more equipment and infrastructure (which has no economy of scale per se because prices are determined by the network vendors who will not necessarily lower prices on stuff like routers, and the cost of labor to build larger and larger fiber networks will not decrease), and the more equipment you install, without any bandwidth management or restrictions, the usage simply matches whatever additional overhead is added. The law of diminishing returns then kicks in, so you end up spending more money on infrastructure just to maintain the same level of service.

What I see as really happening down the line is what Comcast is trying now...they are going to cap you and then start charging for tiers of service so you're going to pay more the more bandwidth you use.
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