Network Computing is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

DSL Surge Still Can't Catch Cable Modems

The ferocious effort by U.S. telephone companies employing DSL to catch up with cable broadband installations has brought DSL additions neck-and-neck with cable additions, according to a report released Wednesday.

The Leichtman Research Group reported that broadband installations now total more than 33.2 million with 8.6 million subscribers added in 2004. In spite of a recent surge by DSL, cable held on to its overall lead with 19.9 million subscribers. DSL has a total of 13.3 million subscribers.

"It's a horserace now, but cable has a 10-length lead," said Bruce Leichtman, the market research firm's president and principal analyst, in an interview. "DSL is now running at par with cable. And, in the future, I [expect] the 50-50 split to continue."

Leichtman said cable jumped out in front of broadband installations a few years ago, while the telephone companies hesitated--they didn't want to impact their dial-up and T-1 connections. And he noted that DSL margins are generally lower than cable broadband margins.

Cable built up a big lead and Leichtman doesn't see any technology developments that could change the current landscape of broadband installation. Leichtman said in the early days of broadband installations, cable had the advantage of viewing broadband as "a green fields opportunity." There was no cable service to cannibalize by installing cable broadband.

  • 1