rb@ccivax.UUCP (09/14/85)
> Opinion section starts here: > > If you analyze this service, it's pretty clear what's going on. > GTE is attempting to maximize use of facilities already in place > that tend to sit idle outside the business day. Those facilities > are not massive (24 dialers for all of Los Angeles, for example). > It seems unclear how they can EXPAND beyond the current levels based > on the $25 flat rate fee, since local telephone lines and dialers > are going to be one of the most expensive recurring costs in the > operation. > If you make FIVE one-hour calls of this sort during evening hours > during the month, you've already cost them more than the price > of the service! It takes a few more hours (or slightly more > expensive non-local calls) to reach that level at late night-rate, but > you can still reach the "no-profit" point for them damn fast. Not necessarily. One of the major problems facing the telco's in general and the long distance companies in particular is the problem of people using SPRINT to call a long distance bulliten board. The modems are converting 300 baud signals into binary signals between the two computers. The lines being used are analog lines being digitized at the rate of about 50KB/sec. In other words, a line capable of handling over 100 calls is being tied up for up to an hour. The solution is simple, have 'modem callers' call telenet to call that long distance board, and have computers at each end of the digital line converting back down two 300 baud. Even at 10 cents an hour, they come out ahead (your throughput problem may have been a result of load averaging). The problem is, if telenet must bill the consumer for this service, the cost of billing a 1 hour/week user is more than the cost of servicing the line. (Sending a bill with a 25 cent postage stamp to collect a 50 cent bill). A way has to be found to get the user to use the system enough to make the product pay for collection costs and still appear to be a 'bargain' over calling point to point on SPRINT. Local telepone companies are considering similar tactics to reduce the traffic on the local exchanges. Some are selling 56Kb lines to the PBX busineses already (Illinois). Others are selling 9600 KB lines to the home (Pacific Tel). The main point is that competition will be stiff because the market has only started to appear. Currently less than 1% of all current computer owners use a modem for more than an hour a week, if costs can go down and services can improve, you may eventually see the time when you can use your telephone like a disk drive.