Cost Of SBC DSL Dips Below Dial-Up; Could Lure More Broadband Users

In a move designed to capture as much broadband share as possible, SBC is slashing the price of its lowest DSL package 25 percent to $14.95 with a one-year contract ordered online. Unlike promotional rates that usually go up after a few months, this is guaranteed for the year. SBC signed up a record 504,000 in 1Q05 but is driving toward a goal of 1 million a quarter, according to Reuters. “It’s about market share” SBC Chairman and CEO Edward Whitacre told Reuters. “The sooner we get there and the bigger piece of market we get, the better off we are. It’s essentially us and the cable companies vying for that.” With a low churn rate, SBC’s theory is once it catches them, it can keep them. The goal is to lock in as many customers as possible before the cable companies finish their phone services rollout.
At a Sanford Bernstein conference this morning, according to a note from analyst Craig Moffett, Verizon CEO Ivan Seidenberg said he was “concerned that SBC is playing with fire.”
One theory: this may be the kind of aggressive move it will take to start bringing lower-end HSD prices down to a range that can expand significantly the pool of broadband users — and, with it, the broadband content audience.

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