Although the nation’s largest telcos and cable companies continue to see growth in high-speed Internet subscribership, the rate of growth has slowed, particularly on the telco side, according to data released yesterday from Leichtman Research Group. 

The 3,396,835 net new subscribers added by large tier 1 and 2 telcos and cablecos combined in 2010 was just 83% of the number added in 2009, LRG said. But while the cable industry added nearly the same amount (98%) of subscribers in 2010 as it added in 2009, the number of new subscribers that telcos in 2010 was 62% of what they added in 2009, dragging down the overall high-speed Internet subscriber growth rate.

Net new high-speed cable Internet subscribers for 2010 totaled 2,302.070—about two times as much as the 1,094,765 subscribers added by the telcos during the same period. Cable companies saw the largest gains—about 6% year over year, compared with just 3.3% year-over- year subscriber growth for the telcos.

Large cablecos also have a larger share of the high-speed Internet market, with a total of 41,548,502 subscribers, according to the LRG data, compared with 33,550,867 for the telcos.

The cable company with the largest number of high-speed Internet subscribers—Comcast—and the telco with the highest subscriber numbers—AT&T—had similar size customer tallies, according to LRG. Comcast had 16,988,000 subscribers at year-end 2010 and AT&T had 16,310,000.

The edge that the cable companies seem to have in the high-speed Internet market may relate to the fact that their coaxial cable plant can support higher broadband speeds than the copper phone wiring that is the primary last mile infrastructure in telco networks. Is this an indictment on DSL in tier 1 markets as a drag on overall broadband growth?

Image courtesy of Flickr user InAweofGod'sCreation

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6 thoughts on “Slowing Telco Broadband Growth a Drag on Overall Broadband Growth

  1. Not necessarily indictment on DSL, but does illustrate how bad the FCC vision for national broadband is, when they're putting so much emphasis on wireless for a national broadband policy. FTTH or cable modem are the best answers and will be the best solution for our nation going forward – not slow wireless broadband, which will be obsolete by the time we get it built out.

  2. to bad you can't get usf funding on how rural your customer is and how much bandwidth you give them. This would put more money toward fiber builds in the rural instead of slow wireless broadband. I think the cell companies have the fcc in their pocket.

  3. Agreed that the National Broadband Plan is short-sighted, ill informed, and pandering to the wireless industry. It is rediculous to think that wireless technology could deliver service that competes with FTTH or Cable Modem. If they had thier way, I guess 4Mbps would be good enough for rural America. Sure, we could get away with having slower speeds than other small villages in third world countries. Huh?

  4. I think the strong Cable Modem growth is more attributed to the fact the cable companies price the triple play at a price point that if you want cable tv, it is a no brainer to add phone and cable modem. Taking the triple play is the only way you get a price break on cable tv.

    The survey said most consumers don't even know what speed they are paying for much less getting. Its the bundle, not the technology.

    1. Great point Tim. Are cable companies simply doing a better job of marketing the bundle? Or do consumers really perceive better value with cable modem over DSL?

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