[pure-silver] Re: TESTING; no posts
----- Original Message ----- From: "Jeffrey Thorns" <puresilver@xxxxxxxxx> 
To: <pure-silver@xxxxxxxxxxxxx>
Sent: Sunday, October 28, 2007 11:11 AM
Subject: [pure-silver] Re: TESTING; no posts
High priced telephone service is mostly due to taxation, the actual cost is nearly nothing.
Initial infrastructure build-out costs and maintenance of that network are not trivial costs, labor being the big ongoing one. Good customer service costs a *lot* to provide. And customers are always asking for the newest tech, and it's *got* to be cheaper than the existing tech.
Building and maintaining a telephone company is messy and costly - not enough to justify $.25/min domestic LD rates or $40. phone lines, but not *free* either.
(Disclaimer: I work for a telephone company that was built mostly from the ground up.)
The difference between now and then is the bandwith or channel capacity of the sytem. Although the communication infrastructure is certainly enormously expensive that cost is now spread out over so much bandwidth that the cost per chanel is very low. My comment was intended to mean the cost to the consumer of bandwidth given the amount available. There is a thorough history of AT&T, I will have to look it up to provide a citation, that makes the point that the telephone business was always very capital intensive. Because AT&T was a regulated public utility its return on investment was always problematical. The book states that an investment in AT&T stock at any time during its existence would have lost money compared to the average of utility and industrial stocks on the American Stock Exchange. Even though it was considered a "blue ribbon" stock AT&T had to scramble for capital. I got an illustration of relative costs some twenty or more years ago when I had a tour of the AT&T long lines headquarters here in Los Angeles. They had recently replaced all intercity and intra city (between COs) trunk lines and cables with multi-mode fiber. I was told that the salvage value for the copper wire exceeded the cost of of the fiber installation. Current single-mode fiber has much greater bandwidth than the old type. In any case, my point was that in many parts of the world the advantages of modern communications are being hampered by regressive taxes. 

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Richard Knoppow
Los Angeles, CA, USA
dickburk@xxxxxxxxxxxxx 
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