Level 3 blames Internet slowdowns on Technica

Fri Mar 21 18:06:07 UTC 2014

On Mar 21, 2014, at 12:13 PM, Naslund, Steve <SNaslund at medline.com> wrote:

> We don't know because the service provider rolls that cost up along with the services they sell.  That is my point.  They are able to spread the costs out based on the profitable services they sell.  If they were not able to sell us services I am not sure they could afford to provide that infrastructure.

Monthly fees do much more than finance the cost of infrastructure.  Most large providers take a significant margin.  It’s all about how these services are perceived.  The preservation of this margin is the number one reason why internet access isn’t considered a utility or a basic right today.  It also allows prices to increase unchecked, based on nothing other than the goals of specific companies. 

There are many places where infrastructure is subsidized and controlled by the government.  To them some things are more important than the need to make markets.  They just trust that the overall benefit to society is worth modifying the market.

>  In fact, having been a service provider I can tell you that I paid the LEC about $4 a month for a copper pair to your house to sell DSL service at around ten times that cost.  I am sure the LEC was not making money at the $4 a month and I know I could not fund a build out for that price.

Being a LEC is more profitable than anything else because they control the prices.  If you found an iLEC that charged $4 for something worth $40 that doesn’t mean being a LEC isn’t profitable.  After the long-distance carriers were forced to divest from local the LEC’s grew and quickly bought them.  It’s more profitable to be a LEC than to resell their services.  The only large carriers left are former LEC’s AKA baby bells.
> 

> -----Original Message-----
> From: Jim Popovitch [mailto:jimpop at gmail.com] 
> Sent: Friday, March 21, 2014 11:07 AM
> To: Naslund, Steve
> Cc: Sholes, Joshua; Larry Sheldon; nanog at nanog.org
> Subject: Re: Level 3 blames Internet slowdowns on Technica
> 
> On Fri, Mar 21, 2014 at 11:48 AM, Naslund, Steve <SNaslund at medline.com> wrote:
>> What do you mean by average monthly bill?
> 
> What is the average monthly (non-subsidized) access cost that your friends and family pay each month?
> 
> -Jim P.
> 