William H. Magill on Tue, 12 Nov 2002 11:30:06 -0500


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Re: [PLUG] Business DSL reccomendation?


On Monday, November 11, 2002, at 11:50 PM, Arthur S. Alexion wrote:
With telephones, it was always that the business customers were
subsidizing cheap residential phone service for all.  I suspect that is
the unspoken philosophy behind business broadband pricing.

This was the case until Judge Green declared it unconstitutional....

However, it WAS the policy which gave us universal telephone service. If people outside the central cities (including most suburbs) had to pay the actual cost of their telephone service, as many in rural areas now do, they would think twice about it.

Today, however, businesses pay considerably less for communications services than residential customers. [Remember telephone bills today, especially commercial lines, are based on actual usage.] They are the ones who have had their bills reduced dramatically in size, not the rest of us. The technique is called "skimming the cream" and it is what has made the number of CLECs dwindle dramatically in recent years -- the cream is virtually gone.

In the data business, connections provided for commercial purposes are engineered differently. (Or at least that is the theory). The topologies for aggregating lines and therefore the number and location of routers and the like are different to deal with the increased bandwidth demands.

Similarly, "residential" ($49) ADSL is usually "low speed" -- 768K x 128K whereas, business xDSL normally starts at 1.5Meg X 768K. ... which it turns out is priced almost the same for business and residential.

There is also a direct relationship to the still remaining PUC regulated telephone tariffs... such as the one which says "you can't have residential service for your business." (Which does hark back to the old subsidy business.)

My residential DCAnet DSL is 1.5meg x 380K (what Bell Atlantic used to call their "professional" service, and it costs me $110 per month.

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