Quote:
Originally Posted by Horizon
The upgrade is most welcome, I agree. But I do argue with the "we're getting it for nothing" point.
The last time I looked, I pay a lot of money to VM each month and by VM's own admission, a lot of that is pure profit to them. Aka telephone line rental, which is in fact a connectivity charge. You're paying just for the "privilege" of being connected to their network, they don't do anything for that dosh.
Once VM have the relevant kit in place (which of course does cost them) then whether they're pumping 20mb, 50mb or 100mb down the same pipe is neither here or there. It does not cost VM anymore or less what speed is sent with STM in place.
After network upgrades, usually for broadband, the only real costs for VM lie on their tv side where they do need to pay for things like fixing faulty stbs, agreeing with broadcasters over carriage rights etc and of course staffing costs.
VM are not upgrading the broadband speeds out of the goodness of their hearts. It's a cold business decision based on what they can afford to do, wish to do and what competitors are likely to do. The marketing opportunity that the Olympics brings should not be underestimated.
VM may say they are not launching anything over 100mb this year, although that's not what they've told the City... But I bet they will launch 200mb+ (might even be 1gb) in one location and you'll hear about it everywhere come Olympics time.
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I don 't completely disagree with what you're saying (i.e. there's no such thing as a free lunch), however I do disagree that it costs Virgin nothing to pump 50meg down the line rather than 30 or 20. It does cost them more to put in place the extra bandwidth necessary to handle it. Maybe not on an individual basis, but certainly once you add in multiple customers all downloading more. It's fair to say that Virgin needs to spend roughly the same amount to supply 50meg as they do to supply 5x10meg.
Plus, you seriously underestimate how much money Virgin has to spend on things like fixing faults - compare to Sky, who only really have to send out techs to realign dishes, Virign has to have techs to inspect power levels, cables, cabinets, UBR's, etc. as well as the various teams behind them. It costs a lot more to run and maintain a network like Virgin's than you give them credit for.