New ask Hacker News story: Cellular service providers are charging 10x what the network costs
Cellular service providers are charging 10x what the network costs 3 by huntsmans | 1 comments on Hacker News. I've been thinking about this for a while and the economics of cellular service providers in the US are genuinely fascinating once you dig into them. The infrastructure reality: Verizon, AT&T and T-Mobile have largely sunk their tower infrastructure costs. The marginal cost of adding one more subscriber to an existing network is close to zero. Yet retail pricing for cellular service providers averages $60-80/month. The math doesn't reflect underlying costs — it reflects market power and consumer inertia. Where MVNOs expose the economics: MVNOs lease wholesale capacity from the big three and resell at dramatically lower margins. Same towers, same spectrum, same coverage. The only difference is QCI priority levels — postpaid gets slightly higher priority during peak congestion. For everyday use this is largely imperceptible. When you pay $65/month to Verizon you...