Arris: Cable’s Cost Per Bit Plummeting – Costs Decreasing Inversely to Traffic Growth

Speaking at an Industry Partnership panel this week, Arris Chairman and CEO Bob Stanzione stated that the cable industry’s cost to deliver each bit is plummeting very quickly with the rise of DOCSIS 3.0. According to Stanzione, costs are decreasing at a rate that is roughly inversely proportional to traffic increases — meaning that if downstream traffic consumption is jumping upward at a rate of 50%, the cost to deliver that traffic is headed downward at approximately the same rate. That runs in stark contrast to ISPs looking to bill by the byte, some of whom have tried to unsuccessfully argue that flat rate pricing simply isn’t a sustainable business model in the face of growing traffic.

Oh, dear, no scarcity, no margin. Perhaps they’ll have to resurrect “bandwidth hogs” to justify charging extra.

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