Comcast Corp. is upping the ante in the broadband war with phone companies.The country's largest cable operator said Wednesday that it plans to aggressively deploy super-high-speed broadband services to 10 million homes by the end of the year. Download speeds on the new services will be 50 megabits per second for the top tier, and 22 megabits per second for the second tier. The new higher speed services will cost substantially more than the services Comcast currently offers.
Comcast has begun to deploy the services in Boston, Philadelphia, New Hampshire and New Jersey. Rival Verizon Communications Inc., which offers its own super high-speed FiOS service, competes in those regions.
It also plans to double Internet speeds for all its customers -- beginning with those Eastern regions -- and offer the higher speeds to all customers by the end of 2010. Comcast could finish its speed upgrades well before that, and the company plans on announcing six new major metro markets in the next few months, said Mitch Bowling, a Comcast senior vice president and general manager of Online Services.
Comcast's push comes as cable companies are increasingly relying on their Internet connections to sell customers bundles of services in competition with phone giants Verizon and AT&T Inc., which are spending billions to build out their own pay-TV services.
Internet connections are the most profitable service for both phone and cable companies. They also play the biggest role in deciding where customers purchase their service bundles, analysts say.
After a multiyear stalemate, the tide has recently begun to turn in the favor of faster cable-modem services. In the second quarter, 80% of new subscribers opted for cable-modem services. As consumers flock to bandwidth-intensive applications like online video, they increasingly prefer faster speeds, cable executives argue. Some analysts question the future viability of the slower DSL connections phone companies offer in the vast majority of their markets.
On Wednesday, AT&T announced it had signed up 149,000 new broadband customers over the quarter -- a fraction of the half million customers it signed up during the same period last year.
