Re: VCC cost models .... (was Re: Limits

[Curtis Villamizar <[e-mail]>]

In message <[e-mail]>, "Silverman, Steve" writes:
> 
> I think there is confusion over price vs. costs.   The Internet has always
> been cheap in price because the US government subsidized it.  If you knew 
> what
> it actually cost during the early '80s,  those of you who payed those taxes 
> would howl!


The cost to the NSF of the NSFNET DS3 backbone was about $10M per year
during the late 1980s and early 1990s.  Toward the end of this period
there were an estimated 2M directly attached hosts in the US based on
the DNS walk of in-addr space.  That comes to about $5 per year per
host for the cost of the backbone as a very rough estimate.  Compare
this to the $2B that UUNET was recently valued at and the fact that
UUNET is only one Internet service provider.

In contrast, one fighter plane or nuclear submarine is as costly or
more than the 5 years of NSFNET backbone network service.  I suggest
you read the OIG report of March 23, 1993 which reviewed the NSFNET
program and spoke very highly of its cost effectiveness.  The NSFNET
program is often cited for its enormous return on a small government
research effort by the NSF.

Curtis