Re: BT clueless

Abo wrote:
Nigel Cliffe wrote:
Gizmo. wrote:
"Pd" <peterd.news@xxxxxxxxxxxxx> wrote in message
news:1ib6een.pucuj8l6cxy5N%peterd.news@xxxxxxxxxxxxxxxx
In an article on the BBC today, BT are apparently reluctant to
upgrade the UK's telecomms network:

"The current telecommunications system was never designed to carry
data and many have called for an urgent fibre upgrade.
BT has argued that with costs of up to £15bn to roll out such a
network it needs to be convinced of demand and have assurances from
the government that it will be able to recoup its investment."

<http://news.bbc.co.uk/1/hi/technology/7202396.stm>

Needs to be convinced of demand? Are they really that completely
bereft of anything like an understanding of the internet? Of course
there'll be demand, for HD films and TV, decent quality video chat
etc etc.
Why should BT stump up the "£15bn" ?

Or, in very rough terms, there are about 15 million households in the UK with internet access. So that means everyone (broadband and dialup) with internet access has to chip in £1000 for the "upgrade".
So, convince ALL the neighbours that the £1000+ bill added by their ISP is reasonable ?
If not, make an estimate of how many might pay extra; perhaps 1/3rd ? So that's now £3000 each....

But does it work like that, though? Since the fibre network will be a BT asset wouldn't they be able to cook the books to spin the cost out over three years. Plus they're unlikely to upgrade the whole country in one go, so it could be nine years before the final cost hits them.

What they would do is raise debt to cover it, or raise notional debt. So the per annum cost is the cost of servicing the debt.

What you do find with all this stuff, is that there is almost no relationship between what it costs and how much its used: the reason that a 2M connection has come down from 20,000 a year to around 20 quid a month, is that lots of people are using it.

This means that yoiu have a very difficult commercial decision to make. If no one takes it up you are massively in loss, if everybody takes it up you are massively in profit.

What BT wants is for the government to underwrite that risk, to let it make a massive profit if it is hugely successful, OR if OFCOM wants to interfere to stop them making a vast profit, to insure against the possibility that the whole thing will be a commercial flop.

I was at a commercial/technical conference once: At coffee time a german banker approached me 'Do you understand this" "yes, mostly" " I undertstand that if this technology is suucessful, it will be so because of government regulation" "yes" "and if it is profitable, the government can control its profit" "yes" "Then I am not interested. It will never be allowed to make an indecent profit, and that is what I must have to balance the risk" And he walked out, never to return..

Look at NTL, the only other BIG player in the game..fibre laid everywhere on the expectation that people would pay to watch decent TV. Saved only by the accidental fact that you cam carry a lot of internet over 'cable' and that people who didn't want to pay for TV, and in any case SKY was already up there, didn't mind paying a *bit* for decent internet.

What is going to happen is that BT will test market a little bit of high speed fiber broadband, probably in London or another major city, and see what people are prepared to pay, and when they have the bugs ironed out, roll it out nationwide over a period of many years, like they did with system X in the 60's.

It WILL hasppen, but not as fast as people would like, and it will provbably be fairly expensive to sdtart with.






.

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