Cable Companies Selling More Broadband Than Telcos

Last week the Leichtman Research Group published a study that included the nineteen largest cable and telephone broadband providers in the United States. The survey, representing 94% of the current U.S. broadband market, revealed some interesting findings:

• The top broadband providers account for 64.1 million subscribers.
• Cable companies have about 34.7 million broadband subscribers.
• Telephone companies have about 29.5 million subscribers.

And even more interesting:

• The top cable companies added 1.2 million subscribers, representing 54% of the net broadband additions for the quarter versus the top telephone companies
  
• This is the first quarter since 3Q 2004 that cable added more broadband subscribers than telephone providers.
• Overall, broadband additions in 1Q 2008 amounted to 75% of those in 1Q 2007 – with cable having 84% as many additions as a year ago, and Telcos 67%.
• The top cable broadband providers now have a 54% share of the overall market, with a 5.2 million subscriber advantage over the telephone companies.

Cable broadband subscriber rates are growing at a more rapid rate than the telcos. The cable companies have built a network that has always been easier to upgrade and offer broadband services on. Telcos are stuck with having to provision lines for ADSL by removing bridge taps and loading coils on copper wire lines that, in some of the older cities, are approaching 100 years old. The telcos have also had to deal with distance limitations and have struggled with cramming ADSL equipment into remote terminals in the field - there is only so much room in those roadside boxes and if they don't have space for you, you don't get a connection. Here's more from the Leichtman Research Group:

Verizon added a net of just 4,000 subscribers to its copper-based DSL service in the first quarter. It gained 262,000 customers for its fiber-based (FiOS) service during the same period.

Is the low hanging ADSL fruit picked over? The ADSL push by the telcos may be coming to an end - at least for some of the providers.

See the Leichtman Research Group study for details.