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Re: Provider credibility - does it matter? was Re: Inter-provider relations

  • From: Jim Dixon
  • Date: Fri Oct 25 14:40:13 1996

On Fri, 25 Oct 1996, Robert E. Seastrom wrote:

>    Europe heavily subsidizes the US Internet.  It's not just VBCnet: the 
>    European Internet community pays something like 90% of the costs of 
>    traffic between Europe and North America.  The same applies to the
>    rest of the world.
> ... 
> Have you ever considered that you might have a lot less bandwidth cost
> to the States if (as Jeremy Porter pointed out) the costs to run a
> line intra-Europe reflected the REAL COST of doing so instead of being
> government-sanctioned overcharging.

The number of logical hops here is a little large.  The costs of doing
business in Europe <yawn> do include high telecomms costs between 
European countries.  These are (a) falling and (b) shared more or less
equitably among European providers.  But costs for circuits across the
Atlantic are (a) borne almost entirely by European networks and (b) have 
nothing much to do with intra-European costs.

It doesn't cost much to run fiber across a border but it costs real 
money to lay several thousand miles of cable.  Think about it.

I am not on some sort of crusade; this is not a stable arrangement and
won't last.  Benefits flow both ways; in time the costs will come to
more or less match the benefits.  Not because I say yes or you say no
but because the market will adjust itself.
 
> business.  But don't give us this "Europe is subsidizing US
> infrastructure" dreck.

Oh, lighten up.

As I said, my main point was that the Economist's model was seriously
flawed.  

I am an American doing business in both the States and Europe, not a 
socialism-loving American-flag-burning Limey.  ;-)  

I can see how the system currently works, and I know it's not going to last.

--
Jim Dixon              VBCnet GB Ltd +44 117 929 1316  fax +44 117 927 2015
http://www.uk.vbc.net  VBCnet West   +1  408 971 2682  fax +1  408 971 2684

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