October 24, 2008

Broadband Growth Slows Further In The Tough Economic Climate

Existing Customers Will Trim Excess Value-Adds; Prospects Will Put Off Adoption

by Sally M. Cohen

with Michelle de Lussanet, Abe Garon, Laura Wiramihardja

Executive Summary (This is a document excerpt)

In the first six months of 2008, telcos and cablecos were already witnessing a slowing in the growth of net broadband subscriber adds. With the onset of the global economic crisis, service providers face an even steeper uphill battle to win new broadband customers. While existing broadband households may be slow to abandon their connections altogether — even in a tough economy — those consumers who don't have broadband will put off adoption even longer to avoid spending the money. Product strategists responsible for the success of residential broadband services can continue to grow broadband penetration in a tough economic climate by positioning their service as a gateway to cheap content and communications. But this approach requires careful planning on the part of providers to ensure that they do not get cut out of the value-chain.

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