DSL Prime: U.S. Q1 Stats

U.S. growth was anemic, and that's just part of the story. In France, and this is just one example from one nation, free.fr offers more for less than anyone stateside.

by Dave Burstein of DSL Prime and Future of TV [July 2, 2008]

U.S. Q1 Numbers
Rumor: As Q2 finishes, it's possible Verizon will show a net decrease in DSL subscribers because anyone sensible wants to switch to fiber. They came very close in Q1, with net adds of only a few thousand.

It was a really bad quarter for DSL in the U.S., with cable jumping ahead despite much higher prices. DSL had been leading cable for several quarters, mostly as the percent15-20 offers pulled some of the last dialup customers. AT&T raised prices, Verizon killed advertising, and none of the larger carriers extended into the 20M or so households they don't serve. Brian Roberts of Comcast attributes this to the effectiveness of selling bundles, now that voice is available to almost all their subscribers. Speed could be part of the difference, It really is a pleasure when I'm downloading a big report to see it come over at 8 to 10 megabits on a cable modem, compared to only 3 megabits on our (rock solid) Verizon DSL. I just downloaded iTunes after reinstalling Vista (don't ask); 57 megabytes came over in less than a minute at over 11 megabits per second. FIOS, please come here before everyone jumps to Time Warner. DSL Reports says New York will get an early rollout.

Cable Modem Subscribers:

Telcos, including FIOS and Uverse

Company	Total (,000)	Added (,000)	Percent Added
AT&T	14,647	491	3
Verizon	8,505	266	3
Qwest	2,701	90	3
Embarq	1,340	63	5
Windstream	911	40	4
Century Tel	586	31	6
Cincinnati Bell	228	6	3
Covad	~500	0	0
Telephone Subtotals	28,207	1,045	4
Grand Total	62,431	2,227	4

Figures from The Online Reporter and company releases.

30 Euro 100/50 Fiber, 70 Nation Calling, 100+ TV Channels, Powerline Home Connection
Free.fr fiber shows the world what's possible
Xavier Niel was excited a while back as we watched the first test of the optical FreeBox. Today, he turned on commercial service, racing against Neuf and FT to fiber Paris. They begin 4 years behind Verizon, but I bet they get to 80 percent of Paris before Verizon gets to 80 percent of New York or AT&T to 5 percent of Chicago. Coming through the Paris sewers is individual active fiber to every home, which the U.K. and EU regulators believe is better than PON because it can be unbundled. They are already engineering in other cities, and Niel believes he can profitably serve any city in France that allows the fiber above ground.

Free's offer is 100 Mbps down, 50 Mbps up, with early users confirming they are getting those speeds. You also get unlimited calls across Paris and 70 other countries. Jennie spent an hour on the phone to Denver our last trip. WiFi phone and advanced calling features are included. He offers 100 channels of TV with an HD pvr, and a slew of advanced video sharing tools. He's got a great little powerline modem built into the power supply, which is reliably working throughout the apartment.

The price is 29,90 euro, or about $45. Markedly slower service from Verizon or Time Warner would go for about $150. Bell Canada and AT&T are 90 percent slower, and also want about $150 for that package. Other than about $10 difference for the wholesale video package, those five companies should have similar costs. Free.fr has no cap or congestion problem, simply inexpensively upgrading the fiber between exchanges when necessary.

Free's engineers are brilliant and Xavi is a great manager, but that's not enough to explain the difference in price. The company is profitable enough to pay hundreds of millions in income taxes, and has fiber and DSLAMs through most of the country. Draw your own conclusions.

ARCEP is pressing him to deploy across his 3.5 gigahertz spectrum, presumably a Wimax network. I bet he'll find a way to include some of that in the 30 euro offer. The last time I asked he was holding off because the 3.5 gig equipment wasn't ready. Some vendors are saying the time has come, but of course vendors will always say that.

Copyright 2008 Dave Burstein.
The DSL Prime Newsletter is reprinted with permission.

"The power of the printing press belongs solely to those who own the presses"
—A.J. Leibling

The Internet is the cheapest printing press ever invented.