Recession improving broadband sales

By Julian Clover
September 24, 2009 11.33 UK

CTAM EuroSummit – Lisbon. The downturn in the economy is having a beneficial effect on the sale of broadband internet connections. According to the latest Solon European Cable Survey, a third of operators questioned saw an upturn in broadband subscriptions as the recently unemployed sought to replicate the speeds they had enjoyed at work in the domestic environment. However, 40% of participants expected a slower growth in premium pay-TV services as subscribers entered unemployment and consequently reassessed their communication services.

Munich-based Solon interviewed 17 operators across 13 different countries for the bi-annual survey. Ten were based in Western Europe, with the remaining seven in Eastern Europe.

“The challenge of the maturing broadband market is that growth is coming from migration, cable operators have to come to terms with it not being a growth market any more, rather a churn market where they have to win over subscribers from their competitors,” Solon principal Dorothea von Wichert-Nick told the CTAM EuroSummit in Lisbon. “With the implementation of DOCSIS 3.0 operators have a once in a lifetime chance to take cable into an industry-leading position.” She said cable was now overtaking DSL and other fixed line operators through the marketing of the right products and in some cases the positioning of broadband over TV.

According to the survey, while the majority of subs in 2008 were still receiving the relatively low speeds of 2 Mbps, this would change radically over the next few years, leading to typical rates of 60 Mbps in Western Europe and 30 Mbps in Eastern Europe, by 2012. For the first time in the seven-year history of the survey, broadband ARPU had increased, suggesting the market leading speeds were adding value to the bottom line.