I understand the start up costs aspect, I actually raised that point earlier in this thread I believe. While the costs are very high, there are companies that have the capital and resources to compete with Comcast/etc... and if the big providers are gouging at the levels you all seem to want to believe they are, then those companies wouldn't hesitate to enter the market.
No, you're missing the point. The monopoly allows price gouging, it's not *required*. I'm Verizon. I own a bunch of infrastructure from when I was AT&T that I provision for internet service now. I charge $60/month. You're New Company Inc. You didn't used to be AT&T, you have n existing infrastructure built over decades than can be re-purposed. You have to start from scratch. Well, you think, still worth it since the margin on $60 internet service is so high! You build out infrastructure for the market you want to compete in, and start offering $45/month service indenting to take market share from me and recoup your investment in 10 years. I lower prices in just your market to $5/month taking a loss.
How much market share do you have now? Guess what, I have other markets where I still charge $60/month. Are you going to build out infrastructure in all of them and hemorrhage money while I wage a price war of attrition with you? Because we're talking 10 figure up front investment now, probably more *just to get started* with no guarantee you're going to win market share from me. If you do, you are doing it at lower margins.
Take that business plan to investors and see how far you get.
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