Person who said: “Monumental quantities of ignorance. 11/10 for utter blogshit.” - Which cable company do you work for?

Mark - years and years ago before “cable modem” or broadband were household terms, Tom Jermoluk (@Home’s 2nd, I think, CEO) was absolutely certain that broadband would be free within a couple of years, and would be “paid for” by advertisers. What he failed to understand, and eventually caused the bankruptcy of Excite@Home, was the sheer greed of cable companies, Comcast and AT&T Broadband in particular. Contrary to popular belief, it was not the (albeit) dumb purchases of BlueMountain etc that caused @Home to die, it was ATT Broadband, Comcast, and Rogers.

What the general public fail to understand is that cable companies are very, very old fashioned. And the own (OWN) the FCC, via dozens of PACs. @Home stock price constantly fluctuated because of worries that the FCC would force cable to open its lines to competitors (a la Ma Bell). It never happened, because the cable companies just bought their way out of the problem. Cable internet was considered a data service not a telecommunications service by the FCC. That classification was upheld by the Supreme Court in the Brand X decision in 2005 (cable spent a fortune on lawyers to ensure it).

You are right, costs HAVE gone down (I know this for a fact as a former cable company employee in the broadband division) - and those costs will never, ever be passed on to customers. Remember how the DSL companies did a slew of “19.95/mo for 6 months” in an attempt to sign up new customers? None of the cable companies bought into it - they all refused to lower prices and get into a price war. Instead they upped the speeds (which cost them less), cut a few corners in customer service (see their JD Power ratings), and spent heavily on advertising the shortfalls of DSL - which admittedly DSL has done to cable as well, but to a much lesser degree.

Oh and other than WiMax we can also dream of broadband over power lines. Stress dream. I think our only hope is that Google launches 400 satellites and offers free broadband to the world.

But those aren’t the only costs in the equation…for example, customer care. I can call Rogers tech support 24×7 and get a human…maybe not a smart one…but one I can yell at. That can cost up to 20% of the price of the service. Try calling YouTube for support…

And speaking of “price of the service”, those billing systems…and paper bills…and billing support reps…and dunning letters…and no-pays…all cost money too.

And Google doesn’t send installers to wire your house. And they don’t have to pay for right of way on electric poles and subway tunnels.

Some of these costs are fixed and some are marginal, but either way they need to be covered. And its not unreasonable for the operator to have some margin as well.

The ISP’s are the nexus of costs in the industry…the entire freeconomics model relies on their existing as a utility paid for by the consumer. For this very reason, the freeconomics model will never apply to the ISP’s themselves, any more than it can apply to the Electric Company.

And by that I mean Toronto Hydro, not the old Morgan Freeman clips I’m watching on YouTube right now.

Guess their traffic shaping systems from Sandvine aren’t doing enough to limit bandwidth consumption (anyone else have VOIP service that has degraded noticeably over the past few months after years of excellent quality?)

And, as long as the CRTC continues to protect the telco/cableco oligopoly from any real competition, the consumer will always suffer while the corporation maximizes profits. Rogers can whine all they like about capital equipment costs, their bottom line is still doing very nicely.

I swear I would pay a premium if I could just find workable broadband alternative.

The lack of broadband Internet competition compared to the old dial-up Internet days shouldn’t be a surprise. There used to be plenty of ISPs competing for the same customer when they all had the same subscriber access costs: $0. i.e. The customer paid for the modem and phone line, not the ISP.

Now it’s different. Competing ISPs fork out big bucks to the telephone companies and cablecos for the right to let their customers access the ISP’s service. That imbalance is why there are really only two high-speed Internet providers today: Telcos and Cablecos. The remaining ISPs have a sliver-thin market share. This is something the CRTC doesn’t seem to care about.

Unless something changes you won’t see broadband prices coming down anytime soon.

no: Thanks, I guess, for your frankness.