Surprise, surprise: rural broadband does not automatically lead to measurable job growth or other economic benefits. That doesn't mean we shouldn't provide it. But it likely is not ever going to provide a financial return for the companies that install it.
Aside from that, assume $5,000 investment per home passed. Assume a 60-percent subscribe rate, at $50 a month retail prices. Assume a 30-percent profit margin on such accounts.
The per-subscriber cost of installing broadband is $8333.00. Recovery of the investment cost, without factoring in the cost of capital or time value of money is about 14 years. If one assumes the useful life of the plant is 20 years, a company never actually makes money on such investments.
1 comment:
I'm working on a quad-play project delivering 30 megs+ Internet, home phone, IPTV, and MVNO cellular service.
Out of the 19 counties in the project area, only 2 have over 100k people passed and 1 has only 6k.
I'm under $50/home passed.
Post a Comment