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Originally Posted by towny
One problem with this that springs to mind is the necessarily restricted market for such a service. Sky potentially has access to every household in the UK, and something like 7 million existing subscribers to target advertising at. I suspect neither NTL nor Telewest have access to a large enough subscriber base to make such a service viable. The fewer 'NTL+' boxes they are likely to sell, the higher the unit price for each box would need to be, to cover development and other costs.
I think if you want such a service, best option is simply to endure the hassle and switch to someone who already provides it.
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When you look at something that your competitors have that you don't have, you have to think beyond the cost of providing it but also at the cost of NOT providing it. If you take the view that it is not economically viable you risk the chance of losing a lot of customers to the opposition thereby cutting your own revenue and increasing the oppositions. The opposition, by having gained many more customers for the product recovers the cost of R & D sooner and goes on to other projects that take it even further ahead. Unit prices for the oppositions products also decreases with the larger number of takers so they win again.