8 Comments

Summary:

The number of new broadband subscribers continues to slow in the U.S., according to data gathered by UBS Research, driven primarily by market saturation. The Wall Street firm estimates that there are 67 million broadband subscribers in the U.S., or roughly 60 percent of the nation’s […]

The number of new broadband subscribers continues to slow in the U.S., according to data gathered by UBS Research, driven primarily by market saturation. The Wall Street firm estimates that there are 67 million broadband subscribers in the U.S., or roughly 60 percent of the nation’s households and about 70 percent of those with a PC.

netbroadbandadds.gif

As we’ve previously noted, the number of net new broadband subscribers during the first half of 2009 was down 27 percent from the first half of 2008, to about 2.1 million. UBS Research expects this downward trajectory to continue.

We expect continued declines in the remainder of 2009 and 2010, with total broadband subscriber growth of just 5.4% in 2009 and 3.6% in 2010, vs. 8.4% in 2008. We expect broadband subscriber growth to slow to 3.5% in 2010, down from an estimated 5.4% in 2009. This will drive consumer broadband revenue growth of just 2.6%, down from 6.9% expected in 2009.

Average revenue per unit in the second quarter of 2009 was $36 a month: telcos took in an average of $31 while for cable companies the average was $41, mostly because they had higher speeds.

In the past, both Stacey and I have argued that broadband subscription providers need to counter the slowing growth by offering higher-speed (both up and downstream) subscription packages that command higher monthly fees. Instead, some backward-looking cable operators such as Time Warner Cable are looking to impose bandwidth metering to protect their revenues.

There is hope, however, that the broadband stimulus plan will boost broadband access, especially in regions that are severely underserved.

  1. This is exactly why we are pushing for more true fiber services. We are trying to start a movement. We believe consumers realize the value in having higher speeds and are willing to pay for it.

    Want to help this movement? Blog or Tweet about the FiberForAll movement.
    http://fiberforall.org/fios-triple-play-bundle/

    Share
  2. Oh no – it’s exploding exponentially. Thats why TWC needs all those extra bandwidth caps that they insist are not just to make more money. I bet their cable subscription revenue is falling too – after all HBO, Digital Cable, etc. are all optional services that people really don’t NEED.

    Broadband providers have two choices – look forward or be replaced/die. Those that look forward will provide better service, more bandwidth and faster speeds at lower and lower prices. Those that go with caps, non-neutral nets and other tactics will be replaced or removed.

    Share
  3. Slovenian ISP T-2 now offers unlimited 100M/10M FTTH connections for 20 EUR / month.

    Share
  4. Bandwidth metering is not a good idea for generating extra revenue. Subscribers are turned off by the uncertainty of their bills rather thanjust by what they end up paying. Predictability is worth a lot to subscribers, especially when they generally do not have a good idea how much bandwidth they actually consume.

    Share
  5. Broadband penetration in the UK has gone so high that the Office for National Statistics has discontinued its quarterly reporting of broadband growth. Nearly 60% of broadband users in the UK enjoy speeds of 2Mbps or higher.

    However, superfast next-generation access coverage which is negligible today is expected to increase quickly over the next year and forecasted to pass 50 per cent by 2014, thereby stimulating growth.

    Share
  6. [...] with a couple million connections but are going to end it with more than 80 million. While the growth of new connections has started to slow, by 2014 the total number of connections will top 96.4 million in the U.S. [...]

    Share

Comments have been disabled for this post