More from the why am I reading about non-Russia stuff on Ruminations on Russia.
Om Malik makes the same conclusions as we are noting anecdotally here and in Belarus as well. Speed sells. At the right price obviously. Customers seem to have a set amount of cash for the Internet, $20-ish) and will upgrade to higher speeds as prices are reduced.
For BellSouth, Faster Is Better:
For second consecutive quarter BellSouth defied the industry trend of bargain DSL connections, adding more premium DSL subscribers than ever before. The company added 263,000 new DSL lines, of which a whopping 80% opted for the two highest speed (3 Mbps and 6 Mbps) offerings. As a result the DSL margins improved, theorize the analysts from UBS. At the end of the first quarter 2006, they had about 3.1 million broadband subscribers. Cynthia has the full lowdown on the earnings.
It is increasingly obvious that the Bells should stop fooling around with television and instead focus on selling bandwidth… a lot of it, for a premium price and make their numbers accordingly. It is a trend that is spreading across the world, and it should be the best defense against the cable companies. The problem is that instead of getting faster pipes rolled out, the phone companies are mucking around with television stuff, which is harder and more expensive, giving cable companies a chance to pick-up voice customers.
This will have a more significant impact on networks which are inherently speed constrained (ADSL, wireless and to a lesser extent HFC (hybrid fiber coax). Whereas the bigger and stupider the pipe the easier it is to provide speed, in both directions.
[composed and posted with ecto]
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