“‘We have argued that broadband is underpriced, given that pricing has barely increased over the past decade while broadband utility has exploded,’ New Street’s report said. “Our analysis suggested a ‘utility-adjusted’ average revenue per user (ARPU) target of ~$90. Comcast recently increased standalone broadband to $90 (including modem), paving the way for faster ARPU growth as the mix shifts in favor of broadband-only households. Charter will likely follow, once they are through the integration of Time Warner Cable,'” Mills reports. “Those increases could be as much as double the current price, New Street notes.”
Mills reports, “As people start eyeing internet-only cable packages combined with a live streaming service for TV, the cable companies can cut the price of the cable bundle to appear competitive with streaming services, but raise broadband pricing to compensate.”
Read more in the full article here.
MacDailyNews Take: Too many customers have no options for broadband internet service. Monopolists are historically bad with pricing and customer service. If you drop your overpriced cable/satellite service with its awful UI, they’re going to recoup their “loss” on your Internet service.
What solves this? Competition. In markets where consumers have a choice, competition keeps prices down and customer service up. In all other markets, where competition is absent, prices will naturally go up, while customer service will decline.
Concerned consumers in the U.S. should contact their elected representatives and demand to know what they are doing to promote competition among ISPs. Without legitimate competition, abuses are guaranteed.