Posted by Anurag in
world
Monday, July 10. 2006
This is an excellent post by Devdas on the ILUG-BOM mailing list, which could not be posted due to some reasons. It explains in great detail how the ISPs operate in india and what their sources of revenue are. Truely an insighting post posted with permission from Devdas.
From: Devdas Bhagat
To: linuxexx@xxxxxxx
Date: Sun, 9 Jul 2006 20:16:04 +0530
Subject: Re: [ILUG-BOM] [OT] Airtel Broadband In Mumbai
On 09/07/06 09:54 +0000, vvcrishxx@xxxxxxx wrote:
> This is an interesting point of view, but I am not sure of its validity. What is
> implied by 'propah'? The valuation of costs on the basis of downloads in
> entirely an artefact and bears little or no relation to the actual costs. How
> much are the other costs (I don't want to know someone's business plans, but
> merely an idea of the real cost of doing business as an ISP)?
>
Ok, the ISP business model basically runs like this:
Buy x units of bandwidth for d0 currency.
Sell y units of bandwidth for d1 currency per unit, where y*d1 > d0 and
y > x. This is also called overselling.
The ISP business has high capital costs, and requires low operating
expense to be profitable.
Continue reading "the isp business model"
