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Broadband Usage Up 42% In The U.S. In 2003
Kickassthegreat writes "As reported here by Reuters, broadband usage in the U.S. jumped 42 percent in 2003 as compared to 2002. As more people sign on to high-speed access, how long will it be before we start seeing the cable companies (such as Comcast) start dropping their prices to levels which compete directly with dial-up?"
Never. Just like CDs are still more expensive than tapes.
the RIAA drops the prices on CD's to compete directly with cassette tapes.
Have you been touched by his noodly appendage?
It would be nice to know what they took as "broadband" speed. I know that the speeds of broadband in Japan are blinding compared to what we have in the U.S.
If they raised their standards perhaps we would see quite a different deployment figure.
The preceding message was based on actual events. Only the names, locations and events have been changed.
You forgot the golden rule of monopolies. The more customers, the higher the prices!
yeah just like we see lower prices at the petrol pumps when the price of oil drops
companies are so desperate to make money, you really think they will drop the price when they can increase ROI for no extra investment at all !
never underestimate greed, especially in USA
As soon as enough people have broadband you can be damn sure ISP's will start introducing draconian bandwidth limits.
"Well Mr. Jones, I know that people are signing up in droves, and many of our markets are over-capacity which is requiring us to upgrade our local services. But I thought it would be nice if we cut the price 75% to compete with AOL's dial-up."
Not in this lifetime, I'm thinking.
Comcast has special introductory offers of $20/month to compete directly with dial-up. It wouldn't make sense for them to drop the price to $20 as it would eliminate their profit margin. They're providing about 100 times the bandwidth of dialup for only twice the price and you complain about value?
If you think broadband is expensive, look at the rest of your cable bill.
-- Political fascism requires a Fuhrer.
"As more people sign on to high-speed access, how long will it be before we start seeing the cable companies (such as Comcast) start dropping their prices to levels which compete directly with dial-up?"
Why would they? More people are signing up to these cable companies (such as Comcast) daily. Why compete with dial-up when people are migrating from dialup?
Damn if I know when Comcast will drop their prices but damn they're expensive!
I've had three broadband connections (that I've actually payed for). DSL at home in NJ which has good pings but wasn't high bandwidth, Time Warner RR cable in Rochester which was pretty good in both respects, and now Comcast in Boston. If someone had told me in advance that my Comcast connection would be 9Mbits/second I'd be less irritated with their absurd fees.
Damn bastards usually want $60 a month plus all kinds of installation fees and shit. Fortunately I'm getting it for $20 a month for 3 months, and that's as long as I need it. But in the end their customer service still blows chunks.
What gets me is that in different regions around the US the same service can vary in price by $30 dollars. DSL in some places is $30 a month and in others it can go as high as $60, for the same speed! And I'm not even referring to people who live out in the boonies who may have to pay a premium which is somewhat understandable.
Presently here, but not there.
how long will it be before we start seeing the cable companies (such as Comcast) start dropping their prices to levels which compete directly with dial-up?"
When the companies stop seeing 43% growth. People obviously like the broadband at current prices. If you have a hot product, why lower the price? When growth stagnates, then the companies will start gettng aggressive -- adding services or reducing prices to either make new customers or steal customers from rivals.
In the long run, doubt that broadband will ever be the same price as dial-up because it both costs more and is more valuable to customers.
Two wrongs don't make a right, but three lefts do.
There's no pressure for Comcast et al to lower prices. Right now, they simply need to show up and in many areas (like mine) DSL isn't available.
It'll happen, as the market saturates and competition finds a way to penetrate the markets. Also, as additional services come up (perhaps like Comcast offering VOIP) they'll probably come up with package deals to make the combo very attractive.
blenderking.com over 50,000 blenders can't be wrong
First of all the cable companies will want to recoup their investment. Then they'll want to make a profit.
The only thing that will drive down prices is direct competition and, as I understand it, cable companies don't have a great deal of overlap. Now, if you were able to pick from half a dozen plus companies to provide broadband connectivity to your home (just as you're able to pick literally dozens of companies to provide narrowband connectivity to your home), then you'd have some active competition between companies, which would lead lower prices. But in a market where you're options are limited to one, two, maybe three companies tops then you're unlikely to see any really aggressive pricing.
And that's before you even start talking about what sort of value people attach to having broadband. If 19 out of 20 people have an expectation that broadband will cost $40/month then that's what it will cost. The fact that the last person in that group wouldn't pay more than $35/month for the service is irrelevant.
"Accept that some days you are the pigeon, and some days you are the statue." - David Brent, Wernham Hogg
Why do some gas stations in the middle of nowhere charge $0.25 per gallon more than gas stations near cities or in a large cluster of stations near an overpass? Simple - because they can. Now I'm no fan of Comcast, but if they're the only major high-speed player in a market, they can set the price. If TimeWarner moves in, they have to cut prices. Supply and demand, no different than any other commodity product.
WHen will broadband companies truly serve the populace by providing broadband capability to all, not just the city folk?
Eat a Chicken, You know you want to.
why would they want to lower prices? Its obvious that people will pay for it at the level it is right now...
Thanks to file sharing, I purchase more CDs
Thanks to the RIAA, I buy them used...
As technology develops, DSL will be available over longer and longer distances. Currently, you can manage a 192kb DSL line over about 21000 feet, if I am not mistaken (which I might be, but these numbers feel about right). I wouldn't be surprised to see that number double in the next few years. Also, as WiFi stuff gets so ridiculously cheap, all that would be necessary would be to put a repeater on every few power poles and voila, rural internet access.
So that's what the question was!
'By how many percentile points will US Broadband usage increase in 2003?'
I hear there's rumors on the Slashdots
The question is, when will METERED broadband access be in place? Probably when no-one uses dial up any more, although with reference to the last article, we (UK) may be paying for phonecalls by the MB by then anyway.
If I promise to be a good boy can I have some better karma?
Cable companies will never drop their prices until we start seeing small neighborhood WiFi ISPs as described by Bob Cringely in his past two PBS columns. I've thought about this for a few years now but, alas, I'm no entrepreneur.
But drop their prices to compete with dial-up? They don't even need to drop their prices to compete with DSL. Where I live, Cablevision gives me speeds of 5 Mbps down and 900 kbps up for $40/mo (with TV service; $50/mo a la carte). Verizon DSL is $50/mo and the best speed would be 625 kbps down. Cablevision could raise their price to $60, $70 per month; you name it; and my only alternative would be a dog slow DSL or dial-up connection.
I'm hooked on the fat pipe and they know it.
Research shows that 67% of those who use the term "research shows", are just making shit up.
It all depends how much competition the government will allow amongst broadband providers. Not so much DSL and Cable which already are competetors, but allowing or requiring cable to allow other companies in.
Plus you have other technologies trying to become involved such as broadband over electric lines. Anything that may actually drive consumers to another company will drive prices more competitively, otherwise we're looking at high prices for a while.
I will shred my adversaries. Pull their eyes out just enough to turn them towards their mewing, mutilated faces. Illyria
In my area, we've had high-speed cable internet available for 7 years, and DSL the last 4 years.
Both DSL and Cable have been increasing their bandwidth to compete with each other, Cable just changed to 5mbit/s, DSL is 4mbit/s. Pricing has remained relatively flat, about $40can/month for both services. However recently Bell has been forced to share their lines, as a result, 4mbit DSL can be found for as low as $30/month.
In Belgium the percentage of people who have ADSL or cable is pretty high, compared to dialup. At this moment 15,4% marketpenetration for ADSL. 4th world wide.
The main reason might be the monopoly position of Belgacom, the main Telecomoperator. They dictate prices between cariers and abuse their monopoly in every way they like.
Because of that there are so many ADSL and cable subscribers. So here is the proove that a monopoly IS good for the customer. Uh, wait. That can't be right.
Don't fight for your country, if your country does not fight for you.
It's more likely that broadband companies will try to takeover other broadband companies or big media companies(Comcast/Disney). To increase revenue, they will need to bundle services. Maybe they'll start offering VoIP phone services at less than what the phone company charges. If you paid 55$ for your cable internet service and 55$ for your phone service, they'll sell you a "bundle": internet service + phone service at 90$.
The phone companies were a day late and a dollar short in rolling out DSL. Time Warner came out with Road Runners years before the phone company would sell DSL for residential use.
In the years between the Road Runner roll out and the start of DSL roll-out, everyone that wanted broadband signed up for a cable modem. So (very) recently, Verizon started trying to roll out DSL and guess what; most of their potential market no longer needed their service, as their Cable modem was great. The residential DSL around here seems to have taken the lower bandwidth, lower price and cable, but still faster than dial-up approach.
Where as Time Warner only needed to announce they could deliver broadband to get potential customers (literally) calling them begging for service, DSL providers are begging for customers to sign up.
DSL is dropping prices (and bandwith.) Cable just raised their rates ($5) and doubled the speed of their pipe and modem connections.
Ma' Bell missed the boat big time. The slashdot summary talks about lowering rates. That's only the ugly step-sister. Cable prices (and service) are going up where I live.
-Pete
Soccer Goal Plans
While I applaud our broadband overlords, I do take issue with the high cost. For me, broadband through Comcast is the only option. I expect to see Dick Cheney join MoveOn.org before I expect DSL in my neck of the woods. The local power company just started providing cable TV and theoretically will provide broadband within a year or two, but I'm not holding my breath. Right now I'm averaging $45 a month for HSI and that's insane.
My other problem with Comcast is their spotty CS. We here in Connecticut just went through a weekend of 50% packet losses and unexplained disconnects. Calls to Comcast resulted in suggestions to power cycle my modem. The problem was obviouisly my fault even though the top thread over at broadbandreports.com was about widespread problems in my state. The patronizing ignorance of most of their alleges techs was astounding.
He took a duck to the face at 250 knots.
I've done some research.
2nd phone line: $20-$30/month
Year subscription to aol: $20/month (if paid in one lump sum $25ish otherwise)
Total: $40-$55/month connection slow (22.x-56k/s)
Cable Internet: $45/month (after entry rates)
Total cost: $45/month (initial setup may cost about $100) speed: Great for home (on average 200-350k/s)
As more people need the internet in a home and as the number of computers increase in the same home, the cost of cable is much better than the cost of dialup.
Infrastructure costs to the ISP are several times higher for cable than dialup or DSL. Also, there's value to the customer in providing faster connections.
That said, after watching my third web host lose data for me (yes, they said they did daily backups and I believed them) I decided to host my own domain, pitched my cable modem and found a provider that gave me a 768k SDSL pipe for the same price as my cable modem.
Comcast's pipe is four times as fast downstream but my pipe is considerably faster upstream - fast enough for me to host my own web and mail and pitch the web host. My DSL provider gives me a synchronous connection for $45 a month and doesn't care if I run a server as long as I don't exceed his rather generous bandwidth allocation. For me it was a win-win situation.
If the market will bear higher prices I guess it's reasonable to expect people to charge higher prices. Sad, but true.
we see things not as as they are, but as we are.
-- anais nin
Looks like the situation in the USA is worse than here, I live in israel and we pay between 120 and 180NIS (1 US$ = 4.5 NIS) for 1.5MBit download and 96KBit upload ADSL, dynamic IP (I prefer it that way), no bandwidth limit (I filled an 80GB hard drive in a week or so) and decent customer service, well actually the customer service is great, the only problem is that you gotta wait on the line for like 20 minutes before getting to talk to someone, but after that, I've yet to encounter a dumb customer service rep.
When I see US people talk about the cost of their broadband, I'm always shocked. Sure, we have some providers that are sub-par, but right now, I've got Bredbandsbolaget ADSL2+, offering up to 24Mb/s downstream and 1Mb/s upstream(I've reached around 22Mb/s down at most right now), no bandwidth cap, and I can host a non-profit, non-commercial server, and it costs around 45-48/month.
What do you think your digital cable box with 1000's of channels does all damn day with that bandwidth? Set up spam from China? Wouldn't suprise me much to be honest.
Dialup sucks ass. It's only used by those who can't get Fiber To The County or so, for the most part. I remember one customer yelling at me years ago because a sales rep said I'd go out there and install a cable modem and internet setup even though he lived some 10 miles from the nearest fiber optic node and didnt even have hard line ran near his zip code. He had a phone though. Imagine the trouble I'd got in for suggesting that he go through a competitor to get dialup.
Thats just a small testament to how lucrative that market is. They need every penny they can get and there is a huge job market for fiber splicers and installers alike. Problems only arise when there is only one company offering broadband in a given location. For years in mine we saw ads like "Time Warner Cable - Your Only Choice" with a big fuckin smile across it on bus stops and billboards.
There are of course the huge issues of how that bandwidth is used. Ideally we wouldn't NEED all that expensive head end multiplexing with GW/hr power consumption if there was not:
- spam
- media pirating
- worm ridden windows boxes
This is where a large part of the cost seems to emanate. The ISP doesn't even really care about how much you DOWNLOAD, its what you UPLOAD, and 2 of the 3 above are good examples of what problems should be dealt with first. I know you gotta upload it to download it guys but usually people who upload aren't real concerned that its going to cut into thier 56k modems QoS capabilities.It seems here we find the core of many many issues present in today's communications' agendas.
You are about to give someone a piece of your mind, something which you can ill afford...
Now now, Belgium is not all of Europe, so don't get any big ideas young man! Here in Germany we pay real Euros for our DSL connections. The odd free stuff you see are Micky-Mouse offers which never stack up to much. Move along now, no free lunches here.
If anything, rates will increase over time. Comcast has had an introductory offer where you pay $20 for 6 months, $30 for 3 months, then $40 for the remainder of the year.
That was enough incentive for me to sign up. I have been on dialup since the early 90's, and I must say.. 21.95/month for Earthlink dialup, Vs. 3.5mb cable for $39.95/month? I mean, figure that one out. Who in their right mind would choose the dialup?
I love the fact that more people are getting broadband. That just sets the stage for the "killer apps" which will make the promise of the internet come true.
Also, for any of you newbie comcast users, or want-to-be customers, please keep in mind that they will enforce the DMCA, if prodded by the right people. I've received a letter in the mail regarding a NAUGHTY TORRENT i used. They haven't seeked any legal action, but please, be weary of what you get and how you get it.
Or does anybody believe there is another killer-app for broadband? All the broadband providers need filesharing to grow.
What I am waiting for is when the RIAA finally starts to impact broadband profits. I think by then broadband will be several times more important than the whole music and film business. Some people might find themselves between a rock and a hard place...
Most ACs are not even worth the keystrokes to insult them. Be generically insulted by this and ignored otherwise.
Technical Support for dumbass L-Users who should have never bought a computer to begin with - is much more expensive. They tend to stay in the dialup plans because they can't justify the cost of broadband. $10/month dialup plans exist for limited Internet usage. That's pretty cheap, and still gives you 10 hours / month for email and what not. Broadband is cheap - but not going to get cheaper. You'll see speed increases before you'll see prices drop. Example, charter's kick to 3Meg service. My DSL company just shifted all plans up by 256/256 without increases in price. So now I'm getting 1M/1M for the price I used to pay for 768/768k - $45/month. The 3 month deals are just a carrot - it's the big sharp stick that carrot is attached to that I worry about.
There several reasons why prices won't drop anytime soon:
- Networks expanding. Broadband means more bandwidth per customer. As more people use it, more websites get bulked up for broadband... more bandwidth used... more capacity needed.... then faster networks needed... websites bulk up more... cyclical
- Limited networks in competition. Most people don't have much broadband choice. Theres either cable (one provider), or DSL (if your lucky enough to live in DSL's short range).... soon power companies will join in, but the technology is still up in the air... and it's not cheap to implement, so I'd expect power companies in rural areas may jump in, but in areas where cable/dsl penetrated... doubt it. Most people have 1 broadband option. Lucky people have 2. Satellite is way to expensive for most people.
- It's a package deal. Cable networks sell packages. That's how they operate. Not ala Cart. They like to do services as well. That's why you have basic cable, premimum cable, sports packages, digital cable, HD TV packages, broadband packages etc. That's the business plan.
Prices here in the midwest are already approching that level. I believe the cheapest DSL plan here runs about $27, just slightly above what AOL charges. If you're not getting that rate, call em up and they'll adjust your payments (although you may have to renew your contract).
LilMikey.com... I'll stop doing it when you sto
People make the argument that since you get more from cable modems than dial up (faster download/upload speeds, always on convienance, etc) you should pay more. However since when has this been true in computing? All through history performance has gone up while prices have gone down. Processor prices, memory prices, monitor prices all drop and so will high speed connection prices. They should and will drop since competition and the law of supply side economics will force them down.
The performance has absolutely nothing to do with its price. Once the cable and dsl companies start meeting their break-even point prices will have to go down, especially to meet competition from the inevitable participation from "discount providers" which is what happened in the dial-up era. We saw providers such as AOL and CompuServe charging $9.99 for 20 hours of service, with 1 e-mail account and no WWW access per month back in the 80's and early 90's for 14.4 Kbps and 28.8Kbps access to what is running for $6.95/month for 56k access with often more than 1 e-mail account. The high speed internet industry will match this trend, especially with WiFi hotspots popping up around the country and are almost always free to use.
Annoyingly "Kickassthegreat" was right that prices will fall but they're way off on the reason.
First, providing high-bandwidth internet is expensive, period. Maintaining the cables and handling all that bandwidth comes at a big cost.
Second, Comcast recently increased their prices! This is with the fall of dialup - the reason being that a large fallout in cheap DSL providers had lead to the inevitable result - low competition means rising consumer costs with no additional benefit. My Comcast bill went from $30/mo to $60/mo Jan 1 2004 - my bandwidth was also doubled, but I rarely can take advantage of the additional bandwidth, so the benefit is primarily theoretical, while my wallet is very tangibly more empty.
However, competition is really picking up - just within my neighborhood in Boston, there are already 4 fiercely competing broadband providers: Comcast (best quality), RCN, Verizon, and BELD.net (BELD is a non-profit that doesn't advertise and has low visibility). It's causing price drops, finally - RCN recently cut their subpar cable modem service in half. The cheap offering will inevitably cut into Comcast's margins - I'm going to seriously consider RCN's low prices (and poor service) in September, though I'll more likely end up with BELD. That sort of price war will coast prices down, thankfully.
Outside the city I'm sure competition is much more sparse, and so, in the 'burbs, I doubt any price fall is going to occur - if anything, the cost of dialup will rise to near the levels of broadband to price gouge locked-in residents into the higher-costing broadband services, as the move away from dialup causes dialup companies to fail, competition to decrease and end with one provider: the broadband one. Enjoy bending over, suburbia.
"Wired" broadband providers will lower prices when there is a viable widespread competitor. That competitor will be the cellular network.
Think about it: The network has vast coverage, laptop market growth has outpaced the desktop market now for 3 years, and most people hooking up broadband at home want some type of wireless access. Verizon will provide a theoretical peak of 2 to 3 Mbps (with most people seeing around 512kbps).
Sure, wired access will always be faster, but for most people I know, wireless high-speed access anywhere you've got cellular coverage is a much better product (and the speed is good enough). I'll never get rid of my 10Mbps down 1Mbps up cablevision connection, but I know tons of people who would for Verizon's new product.
It's being tested in San Diego, CA and Washington, DC. It will probably roll out in the next year.
-ted