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Broadband Growth Rate Plummets
Second quarter additions worst yet....
Not particularly surprising after seeing meager second quarter subscriber additions, but Leichtman Research states that broadband growth is the slowest since the firm began tracking broadband subscriber stats. The nation's twenty largest ISPs added just 887,000 residential and small-business broadband subscribers in the second quarter, half the total growth seen one year ago. A number of factors are involved, from market saturation (some people just like dial-up) to a struggling housing market. However, the telcos were the hardest hit -- with AT&T and Verizon actually losing 220,000 DSL customers.
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Matt3
All noise, no signal.
Premium Member
join:2003-07-20
Jamestown, NC

Matt3

Premium Member

And yet again....

And yet again, here is more proof why the ILECs and MSOs want to implement overages.
openbox9
Premium Member
join:2004-01-26
71144

openbox9

Premium Member

Re: And yet again....

Proof? Slowing rates of customers adds doesn't equal declining rates of usage.

Matt3
All noise, no signal.
Premium Member
join:2003-07-20
Jamestown, NC

Matt3

Premium Member

Re: And yet again....

said by openbox9:

Proof? Slowing rates of customers adds doesn't equal declining rates of usage.
But it does equal a slowdown in revenue growth. Gotta make that earnings report to keep the shareholders happy. If you lose money in one area (subscriber growth) you have to make it up somewhere else (squeeze your current customers for more revenue).

It's simple.
88615298 (banned)
join:2004-07-28
West Tenness

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88615298 (banned)

Member

Re: And yet again....

said by Matt3:

said by openbox9:

Proof? Slowing rates of customers adds doesn't equal declining rates of usage.
But it does equal a slowdown in revenue growth. Gotta make that earnings report to keep the shareholders happy. If you lose money in one area (subscriber growth) you have to make it up somewhere else (squeeze your current customers for more revenue).

It's simple.
The problem is that everyone that lives in areas that have brioadband and want it already has it. ISPs simple REFUSE to build out to other areas which would bring in new customers because it might 10 years to break even. Even though that means for the next 30 years afterwards or more they'll have an established customers base, but who cares about long term goals.

Probably 2/3 of the people that live in my country don't have access to broadband. Which means if the ISPs would actually build out they could have 3 times the customer base in my area. I don't want to hear ISPs bitching and moaning about lack of new custoemrs when they are literally MILLIONS of potential new custoemrs who are willing to hand over their money to an ISP that would bring them broadband.
jc10098
join:2002-04-10

1 recommendation

jc10098

Member

Re: And yet again....

Well,

I've been to TN a bunch of times. Think first was around 2002. It wasn't seeing the huge build out or boom when I first went. Yet, I've gone back multiple times since and 10s out thousands of acres are being ripped down for development. Quite a shame, as the ruralness of TN is what makes the place. With that said, if the pace of building keeps up, you'll be like the rest of the US and have broadband in no time.
88615298 (banned)
join:2004-07-28
West Tenness

88615298 (banned)

Member

Re: And yet again....

said by jc10098:

Well,

I've been to TN a bunch of times. Think first was around 2002. It wasn't seeing the huge build out or boom when I first went. Yet, I've gone back multiple times since and 10s out thousands of acres are being ripped down for development. Quite a shame, as the ruralness of TN is what makes the place. With that said, if the pace of building keeps up, you'll be like the rest of the US and have broadband in no time.
well I have broadband. In fact I have 2 choices at&t and Charter. I guess you could consider Verizon EVDO a choice. I don't. Of course I live in the city limits. Most don't. Sorry at&t and Charter, you have as many customers as you are going to get in my area if you refuse to expand. And as long as you keep offering deals to "new" customers ( new being without service for 3 months. ), many are just going to sign up for your "special deal", cancel as soon as it runs out and sign up with the other guy for six months and then do it all over again. How you make more money that way rather than just expand your footprint is beyond me.
jc10098
join:2002-04-10

jc10098

Member

Re: And yet again....

My guess is they'll wait for development where it's more cost effective to wire. Tennessee by large, is still rural, though not for long. As the cities expand, I am sure the broadband footprint will too. At this point, wiring a small town in between mountain ranges and forest isn't going to net them a huge profit. As this changes, and TN gets built to hell and back (as is happening), broadband will arrive in no time to others as they will be in a city.

GorbGuy
join:2003-09-23
Middleville, MI

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to 88615298
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said by 88615298:

The problem is that everyone that lives in areas that have brioadband and want it already has it. ISPs simple REFUSE to build out to other areas which would bring in new customers because it might 10 years to break even. Even though that means for the next 30 years afterwards or more they'll have an established customers base, but who cares about long term goals.

Probably 2/3 of the people that live in my country don't have access to broadband. Which means if the ISPs would actually build out they could have 3 times the customer base in my area. I don't want to hear ISPs bitching and moaning about lack of new custoemrs when they are literally MILLIONS of potential new custoemrs who are willing to hand over their money to an ISP that would bring them broadband.
Nah, that couldn't be it.

Glaice
Brutal Video Vault
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join:2002-10-01
North Babylon, NY

Glaice to Matt3

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to Matt3
It's because our economy is in the dump right now...

Boricua
Premium Member
join:2002-01-26
Sacramuerto

Boricua

Premium Member

Re: And yet again....

said by Glaice:

It's because our economy is in the dump right now...
I agree. With so many places in foreclosure and many people stretched thin financially, something has got to give. There may be people thinking DSL or food on the table (or a roof over our heads). Which one would you think that said person chose?
jc10098
join:2002-04-10

jc10098

Member

Re: And yet again....

DSL.... cause you can live without food for up to 30 days, but not without internet for a few.. LOL.. I'm only kidding. However, one thing to think about, DSL / Internet can aid in job hunting. It might not be so easy to turn away, when one can search the US or globe for future employment. Otherwise, I guess one could go to the public library, too. Either keeping it at home library works all the same.

CylonRed
MVM
join:2000-07-06
Bloom County

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That certainly is a large factor - if I had money issues DishNetwork and my SE line would disappear post haste - too many other important things than pay tv and DSL.
bjbrock9
join:2002-10-28
Mcalester, OK

bjbrock9

Member

Every market becomes saturated eventually.

Broadband is no exception. I'm sure there are other factors involved but saturation is a biggy.

AT&T's losses are interesting though. I've always wondered why a broadband provider ever came up with a distance limited service. They were doomed from the start. It's no wonder people are turning to cable for their Internet.

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

FFH5

Premium Member

Re: Every market becomes saturated eventually.

said by bjbrock9:

AT&T's losses are interesting though. I've always wondered why a broadband provider ever came up with a distance limited service. They were doomed from the start. It's no wonder people are turning to cable for their Internet.
The new numbers show that cable has progressed a lot over the last couple years. It was only 2 years ago that telco and cable were virtually even in broadband customers with predictions that telco would very soon pass cable. So even with Fios debuting, why has telco fallen behind so quickly?
Cable companies now have 35.3 million broadband customers, compared with 29.7 million at the phone companies. AT&T remains the country's largest Internet service provider, with 14.7 million customers, just ahead of cable company Comcast Corp. with 14.4 million.
jc10098
join:2002-04-10

jc10098

Member

Re: Every market becomes saturated eventually.

DSL isn't a bad idea. DSL (VDSL) can push speeds very respectable speeds. However, the distance thing isn't bad when you are in a large city. With people clustered, DSL is very viable. It is less feasible in rural areas where the telco might be further down the road.
nasadude
join:2001-10-05
Rockville, MD

nasadude to FFH5

Member

to FFH5
said by FFH5:

... why has telco fallen behind so quickly?
to give the cablecos credit, they made a concerted effort and spent the money to build out broadband over the last several years.

the telcos, on the other hand, sat on their @sses regarding broadband (for the most part) while line sharing rules were in place and only in the last few years (near death of line sharing, no line sharing for fiber) have they cranked back up.

so, cable had a couple years of essentially unopposed buildout. In addition, it seems easier (to me) to add broadband to the cable bundle than it is to add DSL to phone service (assuming one even has a landline).

Experience with my sons indicate lots of young people don't even bother with landline service, but most probably get cable video.

Case in point: I live in the metro DC area and have had cable broadband for 4-5 years; I still cannot get DSL and don't ever expect to.
Austinloop
join:2001-08-19
Austin, TX

Austinloop

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Broadband growth plummets

Couldn't have anything to do with the economy, could it???
b10010011
Whats a Posting tag?
join:2004-09-07
united state

b10010011

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Re: Broadband growth plummets

said by Austinloop:

Couldn't have anything to do with the economy, could it???
No, it's illegal file sharing that is causing the decline. I am sure moving to a per byte billing model will fix it.
cornelius785
join:2006-10-26
Worcester, MA

cornelius785

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Re: Broadband growth plummets

i sense strong sarcasm in the above post

Transmaster
Don't Blame Me I Voted For Bill and Opus
join:2001-06-20
Cheyenne, WY

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to Austinloop
said by Austinloop:

Couldn't have anything to do with the economy, could it???
Bingo! 4 dollar a gallon fuel, higher food prices, etc

insomniac84
join:2002-01-03
Schererville, IN

insomniac84

Member

Re: Broadband growth plummets

No bingo. We are talking about internet access, not a phone line that was barely used. People are dumping slower dsl for faster cable because they can get the faster speed for the same price or cheaper when they bundle internet with cable. The telcos' biggest enemy is that no one wants a physical phone line, so they lose the ability to offer bundle rates. The telcos are basically set up big time for failure right now. They are going to have to offer 3mbit dsl for 10-15 bucks a month to compete against 15mbit cable that costs 25-60(depending on bundle deals). If you have stock in any telco, sell it now before it is too late.
tlcbob
join:2001-07-11
Harrisburg, PA

tlcbob

Member

Telco growth reduction

The only reason telco growth is slowing down is that cable has been giving away the store in order to lock unsuspecting suckers into long term contracts. They fear that telco will be drinking out of their video "milkshake" and want to sure up as many long term contracts as possible. So - yeah - good cable growth - not much bottom line ebita. And.. telco's straw is getting longer... look out cable!
decifal7
join:2007-03-10
Bon Aqua, TN

decifal7

Member

Re: Telco growth reduction

Hmm, guess the whole increase speeds to people with multiple broadband options already as opposed to those with non isn't working out for them.. Imagine that? I seriously don't see wtf is wrong with these people, I am not the only person in this area wanting the service.. You have well over 100 house's on my block thats potential customers.. But yet for some damn reason no service... I don't feel sorry for them one bit.. Provide more for those that have it and not even build out services to profitable areas that have non is just weird..

I personally don't even maintain a landline just because their lethargic attitude on building out here... Why support a company that doesn't care?

naked Aggression

Anon

All Washed UP!

In The end we'll have metered internet restricted to web surfing and E-Mail only! Look at the actions of Time Warner and Comcast who treat their customers like CRAP!

I would like to see another internet the way this one used to be without commercial or ISP intervention. I'm expecting Time Warner to apply their piddly 30GB caps on the Greater Los Angeles area. I can see dialup making a comeback!

tad2020
join:2007-07-17
Orange, CA

tad2020

Member

And now?

Can we has price and service quality competition now?

Though the sky is more likely to fall in the mean time that there actually being natural market competition in the near future. It may take a couple of years of the overage fees for ISPs to harm themselves in the manner the cell phone companies did doing the same thing.

Eventually some large-ish city will wire themselves up with fiber and open the network for people to choose what ISP services them, becoming an example of a good way to do something that others can fallow. This would take way the whole medium (speed) aspect of advertising (competition) and force them to use quality of service and speed instead. With fewer centralized fiber hubs to service instead, the build out for ISP startups, and ILECs as well, would be very small to serve a great number of users.

Oh course, by 'eventually' I mean 'never, ever', but I can still dream and add it to my list of things to do if I start my own town.

MrMoody
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Smithfield, NC
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MrMoody

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220,000 loss?

quote:
However, the telcos were the hardest hit -- with AT&T and Verizon actually losing 220,000 DSL customers.
Where does this come from? The linked article doesn't say it and the actual press release from the research firm says they gained 100,000. The only one to lose broadband subscribers was Fairpoint.
EPS4
join:2008-02-13
Hingham, MA

EPS4

Member

Re: 220,000 loss?

It's quite simple. You're confusing "Broadband" and "DSL" (which presumably in this instance also excludes VDSL). Therefore, this is only about adds to the traditional DSL products, not FiOS or U-Verse. (Of course, this means that the telcos are probably losing many customers... to themselves!)

MrMoody
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MrMoody

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Re: 220,000 loss?

(Most) U-Verse IS DSL, whatever anyone says. And the article is about broadband growth, why bring up DSL losses and not count FiOS/U-Verse? Of course Verizon is going to lose DSL customers when they are converting them to FiOS, just stating they are losing DSL customers is misleading, and excluding VDSL from DSL is even worse.
EPS4
join:2008-02-13
Hingham, MA

EPS4

Member

Re: 220,000 loss?

Well as far as I know at&t doesn't break out numbers of FTTH vs. VDSL customers, though it can be presumed VDSL is in the majority.

I agree with you, it is misleading... it'd be like talking about how at&t lost vast numbers of EDGE users with the iPhone 3G release, and hiding the fact that it's because they became 3G customers.

MrMoody
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MrMoody

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My take

Here's the numbers from Leichtman, with percentages of growth added:

Comcast     14,357,000 279,000 1.94%
Time Warner 8,125,000  201,000 2.47%
Cox         3,885,000  40,000  1.03%
Charter     2,787,300  19,300  0.69%
Cablevision 2,395,000  52,000  2.17%
Mediacom    702,000    14,000  1.99%
Insight     424,600    12,400  2.92%
CableONE    361,269    4,726   1.31%
RCN         295,000    4,000   1.36%
 
Cablecos    33,332,169 626,426 1.88%
 
AT&T        14,693,000  46,000 0.31%
Verizon     8,330,000   54,000 0.65%
Qwest       2,732,000   31,000 1.13%
Embarq      1,364,000   24,000 1.76%
Windstream  934,300     23,300 2.49%
CenturyTel  607,000     21,000 3.46%
Frontier    559,300     16,280 2.91%
FairPoint   294,412     -1,166 -0.40%
Cincinnati  229,000     1,100  0.48%
 
Telcos      29,743,012  215,514 0.72%
excl T & VZ 6,720,012   115,514 1.72%
 

Here's my take on the numbers. The cablecos are growing mainly on selling bargain-priced "multi-plays." Note that Cox and Charter are doing worse than most of the telcos.

The telcos, on the other hand are adding broadband subscribers by building out. The 4th through 7th companies in the list have been the most aggressive about building out. AT&T & VZ have basically abandoned building out in favor of upgrading select areas for TV service. Exclude them and the telcos are still growing broadband at nearly the rate of cable ...
voipdabbler
join:2006-04-27
Kalispell, MT

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voipdabbler

Member

Not surprising--"It's the economy, stupid!"--applies here.

I'm not at all surprised. In fact, I expect to see broadband subscriber numbers shrinking over the next 2-3 quarters, especially as the baby bells and cable drive costs up through the use of caps. They just don't get it--broadband is not an essential service like food, shelter and energy. When people's budgets are stretched to the limit with high inflation and credit is tight and/or too expensive, they're going to start dropping non-essential services. We're to that point in many markets already. CEOs of these companies are overpaid and have no comprehension of the quickly deteriorating condition of the average consumer, whose budget is being attacked on multiple fronts. They just don't understand that their greed will be their own undoing.

Chrono
@spcsdns.net

Chrono

Anon

Start monopolizing

See, the problem is, these companies are not expanding their services enough. Theyre just upgrading current users [an example would be upgrading from dsl to Fios, thus losing customers]

Instead of doing that, they need to expand their services where nothing is available [no cable or DSL]. The first one to get there will rake in all of the money, and instead of another company barging in, they should add service to another area that has no service.

Everybody makes money, and everybody's happy
daveberstein
join:2002-07-15
New York, NY

daveberstein

Member

Dave Burstein wonders why U.S. down, rest of world up

Folks

The U.S. data is dismal, although it should pick up because Verizon and AT&T adjust their marketing. AT&T confirms they have restarted building.

But most of Europe and Asia is doing fine, except where they have fiber competition. That includes areas closer to saturation than the U.S., and some with weak economies.

Ideas very welcome, either here or via email daveb &at& DSLprime.com
disc
join:2005-12-31
Raleigh, NC

disc

Member

Re: Dave Burstein wonders why U.S. down, rest of world up

said by daveberstein:

But most of Europe and Asia is doing fine, except where they have fiber competition. That includes areas closer to saturation than the U.S., and some with weak economies.
Hey Dave,

Are their consumers getting hit with interest rate resets on their ARMs and credit debt yet? I'm guessing it hasn't hit them quite as hard yet, in which case I would think that means they'll have a little bit more cushion before they see the effects of the credit crunch.

Otherwise, even though you say they're closer to saturation, I'm wondering if their saturation levels are even higher than expected - that is, they're not as close as the market research guys say they are. But that would mean the market research was too conservative - and what's the odds of that?

Good to see your post!

KrK
Heavy Artillery For The Little Guy
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Tulsa, OK
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KrK to daveberstein

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to daveberstein
IMHO It's about competition and choice. The US gave up on ideas like linesharing and allowed us to fall into the rut.

Other countries ran with the ball and now have many advanced Telecom choices and options--- and incredible speeds, for low prices.

Their growth and penetration is outstripping ours in a major way.
sbcretired
join:2006-01-07
Scottville, MI

sbcretired

Member

ATT looses Broadband Customers

Well no wonder. They have "shortened the outside copper loop" so you may not be able to get ATT DSL where you did a year ago.
Unless you live in a very upscale suburb where they are willing to invest in a fiber fed remote (dslam), DSL growth is dead.
They thought too many customers were on marginal copper loops and repair issues for DSL customers were just too time consuming.
I'll let you in on a big secret, ATT don't give a rip about copper, the outside plant has been allowed to degrade beyond terrible.
Its all about U Verse or whatever the new TV service is.

Pashune
Caps stifle innovation
Premium Member
join:2006-04-14
Gautier, MS

Pashune

Premium Member

Re: ATT looses Broadband Customers

said by sbcretired:

Well no wonder. They have "shortened the outside copper loop" so you may not be able to get ATT DSL where you did a year ago.
Unless you live in a very upscale suburb where they are willing to invest in a fiber fed remote (dslam), DSL growth is dead.
They thought too many customers were on marginal copper loops and repair issues for DSL customers were just too time consuming.
I'll let you in on a big secret, ATT don't give a rip about copper, the outside plant has been allowed to degrade beyond terrible.
Its all about U Verse or whatever the new TV service is.
Meh, and that's exactly how I feel about where I previously lived. 40 year old copper buried underground in a neglected alleyway whilst trying to tease me with 3 meg when my line couldn't support it at all. Oh how I miss that 15,700 ft. 26 ga loop. As soon as my line was tweaked enough for stable 3 meg sync, they stop offering it on my line. What a joke. I can promise you I won't see ANY U-Verse dslams (or any DSLAM for that matter) in that neighborhood for at least a decade.

I relocated and now I'm on cable. Couldn't be happier.