Comment by AnthonyMouse | Hacker News Reader

Comment by AnthonyMouse | Hacker News Reader

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> What becomes apparent if you dig into the numbers is that there's no money in building these networks, at least at scale--they are justified only when there's a money-making opportunity with respect to the content flowing through them.

It seems like the crux of your argument is that it costs something like $60/month to provide internet service and $20/month on top of that to provide TV service but they charge $50/month for each, so they wouldn't be profitable without the TV service. But who is setting these prices?

Is there some law that requires them to charge a money losing price for internet service and then make it up on TV service? Why don't they just charge a profit-making price for internet service?

The market sets the prices of the services at what people are willing to pay. If the cable companies could charge more for internet than they are now, don't you think they would? People are willing to pay a lot more for television service,[1] so if the product you're selling is TV+internet, you can charge enough to justify building a modern fiber/coax network. If it's just internet, you probably can't, at least not in many places.

[1] In my building, in downtown Baltimore, I can get 50/15 FiOS for $50/month, no cap but no TV service, or triple-play cable at 50/5, capped for $109 per month. Almost everyone subscribes to cable rather than FiOS.

I don't get your argument. You seem to be saying that if the internet-only plan is made too expensive then customers will subscribe to the not very much more expensive TV+internet plan. Isn't that what they want customers to do?

No, in this hypothetical the net neutrality advocates have won decisively and the cable companies are in the business of building "dumb pipes."

So you're proposing there is no TV+internet package available from the ISP, they offer only internet and you get your TV from someone like Netflix.

If the ISPs at this point charge a price for just internet service that makes offering that service profitable, what are you expecting customers to do? Go without internet service?

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