Battle for Broadband?


It is Cable Vs Baby Bells and it is going to get ugly. It might be great for us because I think the broadband prices are going to decline. And hopefully so will the prices for video component of the cable business.

Since Baby Bells have started selling DirecTV to consumers and plan to roll out video-over-copper or video-over-fiber services, the cable business will have to counter with some serious price cuts.

ironically both industries while fighting tooth-and-nail with each other are under pressure from new technologies. The RBOCs are losing lines to mobile, while cable loses customers to satellite. Additionally, both are fighting for share in the consumer broadband market.

According to independent financial analyst firm, Probe Financial Associates (PFA), there are several forces pushing the two industries into a long-term, costly battle. “New initiatives require significant spending, and both industries have a mature, declining business at their core,” comments Lynda Starr, Probe Vice President, U.S. Carrier Research.

“In response, both are eyeing the other’s offerings and they are entering each other’s turf,” continued Starr. “For example, some telcos have strong wireless products in their bundles, but they face stiff competition from cable in the broadband market.”

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