[onlyrealcuzzo]

Why is the marginal cost important?

Cellular networks have enormous upfront costs.

They also aren't particularly profitable (at least by GAAP standards with how they do depreciation).

It's almost like asking what the marginal cost of wind power is, and asking why poor people don't get free electricity.

It doesn't matter. You're mostly paying for the windmill...

[googlryas]

Marginal costs are important because that is what is in play when I run out of 4GB and want a little bit more data. As a user I'm paying, say, £13/mo for 4GB (£3.25/GB) as part of my base plan, but if I go over it, I'm all of the sudden paying £117/GB[0], and it costs no where near £117/GB to build out that network. If it actually was expensive to deliver an extra GB to the user, so 5 instead of 4 per month, then that kind of increase in cost is reasonable. But, it is no where even close.

Cell companies are just using it to take easy profits, which ultimately impacts the poorest. Similar to how some banks in the US were using overdraft fees as a profit taking exercise, even structuring transactions to increase overdraft fees.

[0] All numbers are real, and from BT's sim only plan:

https://www.bt.com/products/mobile/sim-only-deals

https://www.bt.com/help/mobile/manage-service/how-can-i-mana...

I also like how, on the second link, they tell you you can "order extra data and minutes" to bridge the gap. You're paying 11.47p/MB, but if you just fill out a form instantaneously the price drops substantially, which is even more evidence that this is usury far above and beyond the reasonable economics of running the network. And finally, the best part, the link for actually filling out that form is broken.

[Nextgrid]

> but if I go over it, I'm all of the sudden paying £117/GB[0], and it costs no where near £117/GB to build out that network

Absolutely agree with you, but the reason for that predatory price is to scare people into signing up for a base plan with more data than they need thus paying for more than what they'd actually use. This is coupled with contracts so they can't downgrade once they realize they use nowhere near that, even though it's a fully automated service that has no set-up nor termination costs that would otherwise justify a long-term contract.

[Nextgrid]

Cellular carriers piss away insane amounts of money on marketing which they then need to recoup from their customers. Everyone will be better off without that overhead.

Not to mention, the billing model of charging per GB per month is predatory and doesn't actually address congestion very well. Charging for allocated bandwidth would reduce congestion much better while still giving people unlimited data in non-congested areas (making good use of the radio equipment & airtime since it's already there & paid for regardless of whether it's being used or not) which would open up plenty of new & innovative use-cases.