Market Research - Topical Reports & Briefs

Cable operators have continued keeping broadband prices relatively stable while steadily increasing data rates, and are using short-term discounting and entry-level tiers to attract price-sensitive customers and compete with generally lower DSL prices. But Verizon’s FiOS service, which operates over a fiber-to-the-home network, is delivering the most speed for the dollar on both the downstream and upstream, according to our annual analysis of high-speed Internet pricing and promotions. This report icludes in-depth examinations of the broadband pricing, bundling and marketing strategies of the top service providers, including Comcast, Time Warner Cable, Cox,Cablevision, Charter, Bright House, Qwest, AT&T and Verizon. The report ranks each provider by maximum speeds provided and by price points, and includes 20 tables and charts of data and analysis.

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TABLE OF CONTENTS

Introduction
Speeds and Prices
Cable Operators
-Comcast
-Time Warner Cable
-Charter
-Cox
-Cablevision
-Other Cable Operators
RBOCs
-AT&T
-Verizon
-Qwest
Conclusions
Also from Pike & Fischer
About Pike & Fischer’s Broadband Advisory Services

TABLE OF FIGURES

Figure 1: Residential Broadband Monthly Pricing and Data Rates Ranked by Maximum Downstream Data Rate
Figure 2: Residential Broadband Monthly Pricing and Data Rates Ranked by Minimum Price per Downstream Data Rate
Figure 3: Average Downstream Data Rates (kbps)
Figure 4: Average Upstream Data Rates (kbps)
Figure 5: Comparison of Cable HSD Services
Figure 6: Comcast High-speed Internet Service Prices and Features
Figure 7: Time Warner Cable High-speed Internet Prices and Features(can choose from Road Runner, EarthLink and in some cases other ISPs)
Figure 8: Charter High-speed Internet Pricing and Features
Figure 9: Cox High-speed Internet Pricing and Features
Figure 10: Cablevision High-speed Internet Pricing and Features
Figure 11: Bright House High-speed Internet Service Pricing and Features
Figure 12: Mediacom High-speed Internet Features and Pricing
Figure 13: Cable One High-speed Internet Pricing and Features
Figure 14: Insight High-speed Internet Prices and Features
Figure 15: Comparison of RBOC Broadband Data Speeds
Figure 16: Comparison of RBOC Broadband Prices
Figure 17: AT&T Broadband Pricing and Features
Figure 18: Verizon Broadband Pricing and Features
Figure 19: Qwest Broadband Pricing and Features
Figure 20: RBOCs’ Percentage of HSD Net Adds

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FOR IMMEDIATE RELEASE

Cable Broadband Speeds on the Rise, Prices Stable

December 11, 2008—If your cable broadband service is getting better, you may have telephone company Verizon to thank.

According to Pike & Fischer’s annual analysis of broadband speeds and prices, cable operators are generally increasing the data rates of their standard high-speed Internet services without raising prices. But Verizon’s FiOS service has injected a new level of competition in the residential broadband market, creating a hodge-podge of discounts and other special offers across the country.

“As Verizon has rolled out FiOS Internet and TV services in more and more communities, the market has seen an increasing variety of prices and data rates, as cable operators respond to FiOS launches [and to a lesser extent similar services from AT&T and Qwest Communications] on an increasingly market-by-market basis,” Pike & Fischer contributing analyst Mitchell Shapiro says in the report.

Like prior years, most cable operators today offer a flagship broadband service tier priced in the range of $40 to $45 per month, depending on the region. But standard cable modem speeds have climbed from an average high of three megabits per second (Mbps) in 2004 to today’s typical 10-15 Mbps, and in some markets as much as 30 Mbps. (Higher speeds are available at premium prices.) And cable companies are increasingly using short-term discounts to attract customers.

This has happened as Verizon’s FiOS, which operates on a fiber optic network that provides more capacity than cable systems, has crept into the market with standard prices as much as $10 more than cable. But a key difference between FiOS and cable modem service is the expanded upstream capacity that Verizon’s network provides, making it easier for users to upload large files, the report notes.

Comcast has adopted technology that will allow it to deliver data speeds that can better compete with FiOS, and other cable operators plan to follow suit.

Pike & Fischer, a BNA company, offers a host of legal and business products covering the telecommunications industry. The report, High-speed Internet Packaging and Pricing Strategies: 5th Edition, is priced at $649 and is available for purchase at www.broadbandadvisoryservices.com. For analyst commentary or to request a briefing, contact Scott Sleek at 301-562-1530 x291 / ssleek@pf.com.

For information about Pike & Fischer’s Broadband Advisory Services, visit www.broadbandadvisoryservices.com or contact Jonathan Wentworth Ping at 973-718-4703 / jping@pf.com.

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Mitchell Shapiro

Mitchell Shapiro, a Senior Consultant for BAS, has been analyzing media and telecom markets for more than 17 years. He has authored numerous in-depth reports for Pike & Fischer on competitive dynamics, vendor shares and market growth in the broadband industry, including studies on the high-speed Internet pricing, the market for municipal broadband services and strategies for deploying fiber-optic networks. He also regularly tracks the financial performance and broadband initiatives of the regional Bell operating companies. Mitch previously served as senior vice president at Probe Research, where he was responsible for the company's tracking and forecasts of broadband network, service and CPE markets. He has also served as a senior consultant with Pangrac & Associates, a broadband engineering and strategic consulting firm, and as an analyst with Paul Kagan Associates, where he tracked technology trends and equipment markets in the cable and cellular industries. He holds a B.A. in Economics from the University of Michigan and an M.A. in Telecommunications from Michigan State University.

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