[Stuart]

Originally Posted by Chrysalis

Contrary to what people might thing a bigger network results on LOWER costs as the cost per user is lower.

1 - Buying bandwidth in larger amounts = more purchasing power so less price paid per mbit.

According to certain forum members, who would be in a position to know, the problem for NTL (and Telewest actually) is that they buy hardware in a niche market. A market small enough that economies of scale do not apply. As I understand it (and as I explained earlier) the bandwidth on NTL's backbone is fine. The problem comes at the UBRs, which may or may not be able to support the bandwidth required. Before you mention buying power again, bear in mind that (I believe) the only company that make UBRs & parts that NTL can use is Cisco. Cisco is far larger than NTL. Also, if Cisco is the only company that makes the upgrades needed, what are NTL going to say? "Reduce your prices or we won't upgrade"?.

2 - Having bigger pipes results in less visible contention, eg. try doing 20:1 contention on a 2mbit pipe for 512kbit users, you would be lucky to get 8 on there without seeing issues and thats only 2:1 contention so when you have smaller pipes you are forced to lower contention to maintain qos this means higher cost per user.

Are we using the same definition of contention here? As far as I know, contention is the ratio of users' max bandwidth requirement vs the amount of bandwidth available. Basically if NTL had a 2Mbit pipe and put 20 1Mbit users on there, the contentention would be 10:1. It is true, however, that to add more users and keep contention down, they may need to add bandwidth.

So in short if ntl do all this and they have to cap to make a profit then something is f**ked up somewhere, they are either making a obscene profit for their shareholders (i think some of you posting here own shares ) or their directors need replacing because they should be making a large profit with all the above practices.

Not sure they are making a large profit, but assuming they are, maybe they NEED to do this to keep the banks and venture capitalists who rescued the company a couple of years back happy? I have worked for a company financed by venture capitalists. If the VCs say you make a profit, you have to make a profit. If you don't, they pull their money out and you possibly fold.

The biggest mistake NTL made was taking out loans and buying loads of smaller cable companies then sitting back and watching while the whole comms market collapsed, but that's a topic for elsewhere.

I keep saying it again and again, although ntl dont compete with telewest it doesnt mean we cant ask questions why telewest are able to provide so much more then ntl and expect a good answer instead of abusive remarks made against those who dont like it.

True. I didn't think anyone was getting abusive though.