The only thing that does raise concern is a rate of price decline that is higher than expected. So it is that TeleGeography says IP transit price declines in most locations accelerated over the last year.
The median monthly lease price for a full GigE port in London dropped 57 percent between the second quarter of 2011 and the second quarter of 2012 to $3.13 per Mbps. The issue is that prices had dropped at a 31 percent rate of decline between 2007 and 2012.
In New York, the comparable price dropped 50 percent to $3.50 per Mbps over the past year, and 26 percent compounded annually over the five-year period.
Just how significant that is cannot yet be determined. A dip during or immediately after the 2008 Great Recession would not have been surprising. A faster drop in prices, given the current recession, might not be unusual, either. And there seems no shortage of new competition in either London or New York markets.
On the other hand, the trend of IP transit pricing on the highly-competitive routes to London and New York do not seem out of line with long-term trends, either.
Median GigE IP Transit Prices in Major Cities, Q2 2007-Q2 2012
In New York, the comparable price dropped 50 percent to $3.50 per Mbps over the past year, and 26 percent compounded annually over the five-year period.
Just how significant that is cannot yet be determined. A dip during or immediately after the 2008 Great Recession would not have been surprising. A faster drop in prices, given the current recession, might not be unusual, either. And there seems no shortage of new competition in either London or New York markets.
On the other hand, the trend of IP transit pricing on the highly-competitive routes to London and New York do not seem out of line with long-term trends, either.
Median GigE IP Transit Prices in Major Cities, Q2 2007-Q2 2012
Source: TeleGeography
No comments:
Post a Comment