Thursday, March 09, 2006
The high cost of video-on-demand
This article is interesting for two reasons:
BellSouth Chief Architect warns of HD VOD costs
First, the article claims that bandwidth currently costs a provider $1 per month. Pretty amazing since you are probably paying $30 or $40 for broadband service. Given that broadband service almost always piggy-backs in on an existing cable TV or phone line (meaning that there is virtually zero additional cost), this is an incredible profit margin.
Then the article makes this claim:
BellSouth Chief Architect warns of HD VOD costs
First, the article claims that bandwidth currently costs a provider $1 per month. Pretty amazing since you are probably paying $30 or $40 for broadband service. Given that broadband service almost always piggy-backs in on an existing cable TV or phone line (meaning that there is virtually zero additional cost), this is an incredible profit margin.
Then the article makes this claim:
- As downloading feature films becomes more popular, they might consume an average of 9 gigabytes per month, costing carriers $4.50. The average IPTV user will likely consume about 224 gigabytes per month, he added, at a monthly cost to carriers of $112, a giant leap from the less than $5 attributed to Internet use. If that content were high-definition video, the average user would be consuming more than 1 terabyte per month at a cost to carriers of $560 per month.
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Robert X. Cringely talked about this with the conclusion that only peer to peer solutions would work.
See:
http://www.pbs.org/cringely/pulpit/pulpit20060302.html
See:
http://www.pbs.org/cringely/pulpit/pulpit20060302.html
Look, I download plenty of online video, as much as any reasonable person would be able to watch in a month, and it's under 10GB. It's affordable. It's fine.
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