Re:Coronavirus could force ISPs to abandon data caps forever
by jariel on Friday March 13, 2020 @03:44PM
(#22570285)
This is a bad reference that completely misrepresents the economics of the situation.
The unit cost of bandwidth is obviously very low, that's not where the costs come in for ISPs. To suggest that Verizon is on 97% margins while ignoring all of the other costs is to promote financial illiteracy.
If ISPs were actually doing 97% net margins, they'd be the 10x bigger than Google.
The surpluses are in fact in high tech companies like Google and Facebook - they are the ones with 'massive margins' wherein there's obviously more opportunity for competition.
There's probably an economic case for pricing alteration, but gross misinformation is not going to help.
The unit cost of bandwidth is obviously very low, that's not where the costs come in for ISPs. To suggest that Verizon is on 97% margins while ignoring all of the other costs is to promote financial illiteracy.
If ISPs were actually doing 97% net margins, they'd be the 10x bigger than Google.
The surpluses are in fact in high tech companies like Google and Facebook - they are the ones with 'massive margins' wherein there's obviously more opportunity for competition.
There's probably an economic case for pricing alteration, but gross misinformation is not going to help.
FYI: VZ's actual income statement [1]
[1] https://www.nasdaq.com/market-activity/stocks/vz/financials