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Technology Stocks : LAST MILE TECHNOLOGIES - Let's Discuss Them Here -- Ignore unavailable to you. Want to Upgrade?

To: Frank A. Coluccio who wrote (3552)	5/5/1999 11:22:00 AM
From: John Stichnoth	Respond to of 12823

>>I'm open for suggestions on how to model this thing. Better you than me. <g> Any model would have to include all sorts of (wag?) assumptions, I'm sure. Even in costing a system that is up and running, you can only get an approximation--look at all the arguments that go on within companies when it comes to cost allocations when they're doing their budgets. How do you allocate various costs? If you want to get a per-subscriber cost, do you charge overhead on the isp's connection to the trunk by average use or peak use? Some boxes are being installed now that combine 56K and dsl capabilities in a single unit. Do you "charge" the 56K user equally on a per-port basis, or on some kind of estimate of use? (The analog part is certainly a lower cost component of the "box"). Any model would have to lay out the assumptions, and would be as valuable as the assumptions made. The model really comes in two parts, doesn't it? Costs and Prices. Of course, they interact, but they would kind of have to be built separately. The competitive issues you talk about (churn rate, demographics) are principally issues on the income/pricing side, as long as they can be reasonably established to satisfy certain hurdles. >>The inference would be that that "someone" will likely be a much larger player, portending a consolidation of the smallers. That's one of the things that is so interesting about Intel's announcement of server farms. They could set prices to the isp, handle the connections, etc., allowing the local isp's to expand bandwidth to the backbone variably. The killer to the local ISP is the period just after installing a bigger pipe, which it hasn't filled up yet, I would think.