I don't know the specific equipment in the ATHM network, but core and metro routing equipment on a like-for-like basis (ie, putting the same capacity in place, which required fewer boxes and line cards today than it did then), is probably cheaper by a factor of 4. Go to ebay and type in Cisco. See how many items are for sale (my guess-75 pages worth). Colo space is certainly off by a factor of 3 from the peak, out here anyway, but ATHM got in before the peak, so maybe today you only save 25% on space. Bandwidth is at least 50% cheaper today. And today you would build your NOCs in places where networking professionals work much cheaper than silicon Valley (a lesson Loudcloud is learning the hard way). I can't imagine how a de novo network isn't cheaper-what areas am I missing?
I think you misunderstand my main point, however, which is that the MSO's have no choice but to build their own, even if it is more expensive. If you are running a business with a key component which is sole-sourced, and that single supplier threatens publically to go away unless you give him a bigger slice of the pie, you may do it short run because you have no choice. But you also vow that as soon as possible, you will qualify other suppliers and will never again put yourself in the position to be held up like that. That apparently is what Adelphia is already starting to do. |
