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Pastimes : Home on the range where the buffalo roam
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To: stockman_scott who wrote (9844)11/18/2002 9:19:24 PM
From: Lizzie Tudor  Read Replies (1) of 13815
 
and then sign up for monthly service ($40 to $100 a month).

Customers aren't exactly flocking to the new service, however, underscoring a common fatal flaw of the Internet boom: Do customers need this service, and are they willing to pay for it?

The problem is this prohibitive pricing and all the providers know it. Earthlink has done surveys that consistently show people don't want to pay more than $30/mo for broadband internet of any kind. That doesn't mean they don't want the service- it just means they don't want to pay so much.

Think about it, at $40/mo (the CHEAPEST broadband rate you can get, wireless or wireline... in fact most are about $50)... thats more than a sprint vision (picturephone) plan... which includes internet access, and more than your cable TV! The value just doesn't add up wrt other monthly charges that consumers have.

The reason the rbocs overcharge for high speed internet (they claim) is to recoup the installation costs, which requires a "truck roll" (truck drives to your house and people install the lines). OK well that might hold water if cable TV weren't cheaper- something that also has installation. But anyway, wireless broadband is like a cell phone- NO install. So that means the service should be $20/mo., the same price as the cheapest cell plans.

I'm sure the VCs and rbocs are well aware that the issue with BB adoption is pricing but they prefer to whine and cry and hope the gov't helps out with a subsidy.
Lizzie
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