Individual subscribers connected at gigabit speeds constitute a relatively new phenomenon. In fact, total global customers probably number only in the hundreds. First introduced by Hong Kong Broadband in 2010, the number of service providers offering residential gigabit services is growing, with more than two dozen service providers providing such service, according to a study by Joe Savage, Telecom ThinkTank principal, and Michael Render RVA Market Research principal.
About seven of those providers offer service to residences as well as businesses, and have networks that pass at least 100,000 sites (not to be confused with “customers”). “Our March, 2012 estimate is that global residential gigabit subscribers number in the hundreds,” the authors say
Some of us immediately would wonder whether those customers, especially in markets were monthly prices are in the $200 range, actually are “business” users, though, much as Google product managers and others have 100-Mbps connections, paid for by Google, so they can work efficiently at home. Some ISPs have found scant interest for 50-Mbps services, for example.
Prices for residential gigabit service range from a low of $26 per month for Hong
Kong Broadband’ s service to a high of $560 per month at network operator Turkcell. Prices
roughly correlate to the capital investment required to pass a subscriber in the serving area, the authors say. It costs $200 per home passed in Hong Kong compared to $1,000 to $4,000 per home passed in Europe and North America. ISPs have seen price resistancewhenever monthly recurring costs approach triple digits.
In North America, Sonic.net will be seen by many, and ought to be seen as notable, for offering 1-Gbps service to consumers for $70 a month, including two phone lines with no-extra-charge domestic long distance. Comcast’s 105-Mbps service in San Francisco costs about $200 a month, by way of comparison.
Gigabit subscribers report that they are online an average of eight hours per day. That compares with the “typical” U.S. Internet user average of 2.5 hours per day. By definition, 1-Gbps customers are not “mainstream.”
In addition to being “early adopters” and “technology enthusiasts,” they stream high-definition content, engage in multi-player online games and tend to be content creators.
It remains to be seen whether there will be higher adoption as the service is made available to more potential users. At least up to this point, few subscribers who pay for their own connections (as opposed to having the bills paid by an employer) seem to have become customers. Also, surveys have shown that most users are happy with speeds they now get.
That said, we will soon get a better look at receptivity to 50 Mbps and 100 Mbps services in a number of markets, such as United Kingdom. Some question whether “build it and they will come” is so reasonable an assumption, at this point.
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