Technology

DSL Lures Bargain Shoppers

6/06/2005 9:13 AM Eastern

Lower-priced digital-subscriber-line offerings are attracting more new broadband customers for telephone companies than cable-modem subscribers for cable operators, according to Leichtman Research Group Inc.

Citing a recent telephone survey of 1,600 random households nationwide, LRG reported that 32% of those interested in getting broadband “express a preference for their local phone company to provide broadband service, while 26% prefer their local cable company.”

That’s a significant change from the same survey LRG conducted last year, in which 35% of those interested in getting broadband preferred cable compared with 23% that preferred local phone companies.

“While cable still has many more broadband subscribers than DSL and will maintain an advantage for years to come, DSL’s emphasis on price and extended availability is clearly having an impact in expanding the category to more cost-conscious consumers,” LRG founder Bruce Leichtman wrote regarding the research findings Monday.

LRG found that the mean annual household income of new potential broadband customers is $59,500, down 10% from last year’s survey. The survey found that the mean annual household income of cable-broadband subscribers is 17% higher than their DSL counterparts.

LRG said the reported mean monthly spending on cable-broadband service is about $40 compared with $36 for DSL. Last year, cable and DSL households had nearly identical average monthly broadband spending, the researcher added.

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