Path: utzoo!telecom-request Date: 1 May 91 20:37:31 GMT From: Andy Sherman Newsgroups: comp.dcom.telecom Subject: Re: Decreasing Costs of Transmission Message-ID: Organization: AT&T Bell Laboratories, Murray Hill, NJ Sender: Telecom@eecs.nwu.edu Approved: Telecom@eecs.nwu.edu X-Submissions-To: telecom@eecs.nwu.edu X-Administrivia-To: telecom-request@eecs.nwu.edu X-Telecom-Digest: Volume 11, Issue 326, Message 5 of 9 Lines: 35 In article , jah@margo.ots.utexas.edu (Jeff Hayward) writes: |> I've been told that AT&T could still make money at a rate of 1/10 of a |> cent per minute, no matter where in the North America you go. I doubt *anybody* could make money at $0.001 per minute. I'd like to see this number justified. |> It is certainly the case that the BOCs (and to a lesser extent the |> IXCs) make an enormous profit on a very inexpensive service. Since when is the cost of installing and running the transmission media the only cost of the call? You got switching, you got operators, you got billing, you got marketeers (No, that's not a dirty word. Somebody has to figure out what services you want to buy). Also, you've got shareholders (in our case, a lot of "widows and orphans") who expect a reasonable return on their investment and you've got a need to fund R&D. Where, praytell, would all this "cheap" transmission have come from if AT&T had just marked up past transmission costs a few percent? If you amortize the past costs of inventing and developing digital transmission and digital switching and try to fund future trends, you're not going to sell services for $0.001 per minute. Do remember that the Internet was developed with Defense Department money. The service can be cheap because it was subsidized. Andy Sherman/AT&T Bell Laboratories/Murray Hill, NJ AUDIBLE: (908) 582-5928 READABLE: andys@ulysses.att.com or att!ulysses!andys What? Me speak for AT&T? You must be joking!