U. S. Broadband Pricing and Alternatives for Internet Service Providers

Abstract

One facet contributing to the growth in demand for Internet services is the rise of residential broadband in the United States.1 While broadband access to Internet functionality has long been available to businesses at reasonably affordable prices, only within the last few years has this access become available widely to the residential consumer at affordable rates. In most areas, two technologies are being used to provide broadband Internet access at present: cable modems and xDSL. Current rates for cable modem service are generally between $39.95–49.95 per month and over 150 cable companies currently offer cable modem services in the North America.2 As of February 2000, Kinetic Strategies estimated that cable modem customers had reached over 2 million and that providers were adding an additional 5000 customers per day.3 TeleChoice, Inc. has reported that, as of the first quarter of 2000, 880,000 people had subscribed to xDSL service.4 The Appendix provides further information on xDSL and cable modem rollouts. In recent months, much attention has been focused on the various technologies used to provide broadband services. Strengths and weaknesses of these technologies have been examined and strategists and visionaries have shed much ink putting forth their views on which technology will triumph.