Saturday, January 19, 2008

Lease vs. Buy: Cable Modem Payback analysis

I try and make a habit of auditing a random bill once a month to ensure I am not being nickle and dimed. Picking out the Comcast cable bill just recently, I see that I am leasing a cable Internet modem at $3 per month or $36 for a full year.

The cable modem that I am using is the Motorola SURFBoard SB5101. I have been using this cable modem now for about 24 months since I moved into my new place. Looking at it, the technology doesn't seem to be that much different than the one I used about 4 years ago.

I scanned the Internet for some prices on this Motorola cable modem to use in my lease vs. buy analysis.

BizRate search results, click here

My initial Ebay search results show the total price ranging from $15.00 to ~ $65.00

So with the price range from $20 to $80, depending on condition and shipping, here is my simple payback analysis:

Purchase Price / Payback in months
$20 / 6.7 mos
$40 / 13.3 mos
$60 / 20.0 mos
$80 / 26.7 mos

Even if I were to buy a new modem when I moved into this place, I would be looking at owning a "free and clear" device in the next month or so....

With that, I am off on a fishing exhibition at Ebay for a cable modem. Any recommendations on which one works best would be greatly appreciated!


Anonymous said...

It would appear that DOCSIS 3.0 will happen in 2008/2009. You may want to make sure the modem you choose is certified for this so you'll be able to get the new speeds that will likely come with these upgrades.


Its amazing waht you can do with a computer today.