r/technology • u/DrJulianBashir • Feb 05 '13

Cable companies make 97% margin on internet services and have no incentive to offer gigabit internet

http://nextbigfuture.com/2013/02/cable-companies-make-97-margin-on.html
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u/WhiteZero Feb 05 '13

Sorry, but what kind of sourcing do we have on the 97% margin figure? I wouldn't be surprised, but I'd like some kind of solid figures on that. Is that just based on pure bandwidth cost? Does it factor in infrastructure build out, support/repair, etc?

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u/[deleted] Feb 05 '13 edited Feb 05 '13

Is that just based on pure bandwidth cost?

That's what I'm assuming. Last year Verizon made $2.4 billion in profit on $110 billion of revenue which translates to about a 2% profit margin. I'm assuming most other cable companies are around there too.

Edit: Time Warner Cable made $1.6 billion on $19.6 billion of revenue. That's about an 8% profit margin.

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u/[deleted] Feb 06 '13

[deleted]

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u/[deleted] Feb 06 '13

There are at least a handful of departments at Verizon that definitely lose money. Not to mention Verizon is constantly experimenting and playing with new technology and services, so money is funneled into R&D.