Forum Archive Index - June 2000

["Jeremy" <jeremy@electrosilk.net>]

Nigel Bree wrote

> Voice is just another form of data; it's merely one with an incredibly low
> bitrate once compressed, and which requires much lower latency than modems
> deliver. Aside from the fact it really does warrant a circuit-oriented
> routing infrastructure rather than a connectionless one, the actual cost
of
> the data transport *is* effectively nil even compared to modem-based WWW
> traffic and provided you do actually compress it (which the PSTN doesn't);
> GSM-coded speech is down around a mere 8kbits/second, after all.
>
> A *single* modern optical fibre can carry over a *million* simultaneous
> voice calls at that kind of rate, with research prototypes going much
> higher still.

Still doesn't fix up the single highest cost - the last half mile.  Until
someone gets a way to connect every house to a high bandwidth connection and
then works out a way to keep that connection going for next to nothing,
costs will stay high.  You will always see high monthly access fees to get
whatever communications you want.

Another factor is revenue.  All telcos want to maintain revenue, so if what
they sell gets cheaper, they will try to sell more of it to keep up revenue.

You should see cheap phone calls, high rentals, and 'new' products pushed at
you constantly.  Especially anything that will use up the bandwidth, such as
movies

You will also see lots of 'value add' products that they can charge
arbitrarily for based on the value to you, not the cost to them.  Look for
things like intelligent networks, follow me numbers, personal assistants,
web browsing on your cellphone, video calls etc etc etc.

As an example of how the telcos work, about 5 years ago Telstra in Australia
offered voice mail for its then hundreds of thousands of customers using GSM
phones.  The entire technology including all the voice storage ran on 2 PC
equivalents plus a bit of network programming.  One-off cost to Telstra a
few hundred thousand dollars.  Cost to customers about $1 million per month.
Another example is the current SMS marketing push which is one of the all
time money spinners.  SMS is integral to the GSM network, costs nothing to
operate and is being pushed for all it is worth because every SMS message
sent has a 99.5 % margin

Basically, you have a personal communications budget of a few hundred to a
few thousand dollars a year.  The Telcos will always take that amount of
money, and offer you more 'services' for in return.

Jeremy



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