Why is broadband costly in small and medium cities?

[PrivateAdmin]

I checked out beamtele which operates in hyderabad. They offer 1mbps unlimited(10GB FUP) @ rs.399 pm, whereas in my city bsnl offers 1mbps unlimited(6GB FUP) @ rs.650 per month. They offer 15mbps unlimited (20GB FUP) @ rs999.

Why is this so.
The plans in other big cities are very cheap and plansin cities like bhopal, gwalior, jabalpur are very costly.
They offer 15mbps unlimited (20GB FUP) @ rs999.

This line is for beam internet not for BSNL

[Karthik]

wow, you are lucky...in my city its even more costly..
I pay 1000 and get only 4 mbps upto 8 gb and 512kbps beyond that
http://www.bsnl.co.in/opencms/bsnl/BSNL/...unlim.html

[Shrikster]

A plain simple answer would be, the price of the broadband depends on the entity who provides it. I recently came across a similar problem and spoke with the guy who offered broadband to simplify it.

Let me explain you the flow.
1. In metro cities, like the Hyderabad, the broadband is provided by the Main Service Providers themselves. Let us assume Airtel. So Airtel will offer its services at its core prices.

2. In sub metros, like Warangal, a person has to purchase certain franchise of that service, pull the service from the metro to his point and then offer it to clients. So he will purchase the services from Airtel at its core prices, transport it from hyderabad to wrangal, and then offer his price(which is usually the summation of core price plus some interest he would get from it), making it more costlier.

3. Further in some small town, you will have to get your own connection from the franchise guy, transport it to your place and the price will be franchise guy's price plus the transportation expenses.

In this way the broadband actually gets more and more expensive according to the cities.