March 26, 2002 -- TeleChoice, Inc. released a new white paper entitled "Why DSL Still Matters" examines the state of the broadband DSL market worldwide and challenges commonly held beliefs and misinformation about DSL.

Defying widespread assertions that it has not been a successful technology, DSL deployments continue to grow rapidly throughout the world, and DSL is now the leading broadband technology worldwide, with 18.7 million subscribers as of year-end 2001, according to Point-Topic and the DSL Forum. According to research conducted by Broadband Intelligence, worldwide cable modems have achieved 11-million subscribers.

"TeleChoice has assembled a thought provoking analysis that demonstrates the case for the continued rapid expansion of DSL services around the world," said Bill Rodey, chairman of the DSL Forum. "It is clear in this white paper that DSL remains a strategic imperative for the future of US telecommunications service providers."

Despite this success, some service providers have taken conservative approaches towards continued broadband DSL deployment due to misconceptions about the market and the technology itself. First among these is the assumption that DSL services are not cost effective or profitable. The paper uses the example of four international providers to show that broadband DSL has and can be deployed profitably, by providers of different sizes in various markets.

Another common excuse for a lack of sense of urgency among service providers on expanding DSL broadband deployment in North America in particular is the claim that competition has been reduced by the failure of many competitive providers. In fact, as the paper illustrates, competition is stronger than ever and in most cases now comes from outside of the broadband DSL industry - primarily from cable providers who are successfully gaining market share in North America not just in data, but also in the core voice markets of many telcos.

The third misconception is that regulatory issues and the requirement to provide access to competitive providers make broadband DSL deployments a risky venture for many service providers. As the paper notes, these fears are indeed valid, but are outweighed by the risks of slowing down DSL deployment, and falling further behind competition from cable and other broadband providers.

Finally, the paper examines the concept that the broadband market is already saturated, and that this will lead to slowing adoption rates. The issue is not that the overall market has been saturated with broadband, but rather that in many cases service providers have not effectively marketed broadband DSL solutions and have not provided the compelling broadband applications and content that will lead dial-up Internet users to switch to DSL. Those providers who do offer these compelling applications typically have much greater penetration rates - and increased revenue from DSL-based services - than those who offer merely a "fat pipe" to the Internet.

"Some broadband DSL providers have been quite aggressive with their deployments, both in terms of coverage and with the addition of value-added services," noted TeleChoice's Pat Hurley. "These providers, four of whom are profiled in the white paper, have demonstrated well above average market penetration, profitability and overall success with their DSL strategies, while those that take a conservative approach have instead fallen behind their competitors."

The paper is available is available for download from TeleChoice's Web site www.telechoice.com.

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