RE: [MLUG - DISCUSSION] AT&T tiered pricing...

["Spurling, Shannon" <EMAIL:PROTECTED>]

The smaller chips and resistors and wires have not changed in price in the last 20 years. Not even the surface mount components have changed that much. Most of the decrease in price you see over time is the reduction in support required as the bugs are worked out, the amortization of development costs, the streamlining of the production lines, and the revisions of the boards and chipsets to reduce the number and complexity of boards and components. A certain amount of volume has to flow for all of these to become cost effective, as Microsoft has painfully found out from their recent entry into the game console market....

Shannon Spurling
WAN Engineer -Specialist

MOREnet, Network Services, Core Network
3212 LeMone Industrial Blvd.
Columbia, MO 65201

Main:(573) 884-7200   Fax:(573)884-6673

EMAIL:PROTECTED
EMAIL:PROTECTED



-----Original Message-----
From: Ross, Matt [mailto:EMAIL:PROTECTED]
Sent: Friday, August 02, 2002 10:57 AM
To: EMAIL:PROTECTED
Subject: RE: [MLUG - DISCUSSION] AT&T tiered pricing...


I didn't mean a drastic drop in cost, a 25% price drop is about what I
expected.
I figure about 30% of the parts can be used in either level of LAN, such as
resistors, some of the smaller chips, wires, etc.  

> Sub components? Are we talking the lasers and chips? They are 
> different than what you would find any where else. Some of 
> the stuff you find in an enterprise level LAN is used in a 
> smaller LAN, but not all of it. Cisco 6500 series switches 
> have been around for about 5 years now, and I think there is 
> less than a 25% difference in components and chassis price 
> since then. Wierd, eh?
> 
> Shannon Spurling
> WAN Engineer -Specialist
> 
> MOREnet, Network Services, Core Network
> 3212 LeMone Industrial Blvd.
> Columbia, MO 65201
> 
> Main:(573) 884-7200   Fax:(573)884-6673
> 
> EMAIL:PROTECTED
> EMAIL:PROTECTED
> 
> 
> 
> -----Original Message-----
> From: Ross, Matt [mailto:EMAIL:PROTECTED]
> Sent: Friday, August 02, 2002 10:23 AM
> To: EMAIL:PROTECTED
> Subject: RE: [MLUG - DISCUSSION] AT&T tiered pricing...
> 
> 
> What about the cost of the subcomponents? I would think that would be
> dropping as many of the subcomponents you find in an 
> enterprise level LAN is
> used in smaller LAN's.  Also, there is the simple demand 
> curve.  If you drop
> the price, companies will buy more to be able to sell more 
> bandwidth, thus
> increasing their profits, and their ability to buy even more 
> equipment.  
> 
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