Not as much as you might think, and maybe not at all.
While they save the cost of maintaining an inventory, they also loose
the revenue meant to offset that cost. Even if they were only
breaking-even on modem rental charges, it can make for a larger number
in the gross revenue column, which is appreciated by investors who don't
(can't) look at the whole picture.
Also, the cost of support likely goes up when dealing with customer
owned modems. With a company owned modem, it is easier to isolate a
problem because they can simply swap the modem, no questions asked. And
when they isolate a problem to a modem that you own, it's your
willingness to replace the modem that determines whether you'll continue
to be a customer or not. (You may not even believe the problem is your
Those are just some of the reasons why a big company doesn't encourage
On the other hand, selling modems in stores like Best Buy and Circuit
City is a marketing tool. So even if it does cost more to service
customers who own their own modems, a portion of that cost can be
written-off as marketing expenses. So the hawking of modems by these
stores is a good thing. But if you call most MSO's directly, there won't
usually be a big push for you to buy your own modem.
Why your MSO wants you to own your modem for the level of service you're
subscribing to is difficult to say. But it's not as simple as it being
flat-out cheaper for them when people own their own modems.
Disclaimer: My views reflect those of myself, and not my
employer, my friends, nor (as she often tells me) my wife.
Any resemblance to the views of anybody living or dead is
coincidental. No animals were hurt in the writing of this
response -- unless you count my dog who desperately wants
to go outside now.
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