Cablecos, telcos struggle with falling broadband growth

Telcos and cable companies may have survived the second quarter and only suffered a few scratches, but the long-term prognosis for these patients may not be so good. Broadband sign-ups in the quarter for both businesses plummeted to just about half of what they were a year ago, a metric that has experts scratching their collective heads.

Fewer than 890,000 new subscribers signed up with the 20 largest telcos and cable companies in the quarter, the smallest number of new customers in at least seven years, said the Leichtman Research Group.

Phone companies were hit hardest, adding just 23 percent of the customers they attracted a year ago, despite new, faster offerings, said Leichtman CEO Bruce Leichtman. Cable companies signed up about 85 percent as many customers as they did in the same quarter last year.

"While the relative number of quarterly broadband adds has certainly peaked, the decline in additions this quarter compared to the same period last year was exacerbated by Verizon and AT&T's emphasis on selling higher speed Fios and U-verse bundled services, often at the expense of the traditional DSL service," he said in a press release.

For more:
-See the CNET news story

Related articles:
Leichtman said last year was abyssmal for broadband growth. Leichtman report
Credit Suisse recently downgraded telco stocks, partly on broadband concerns

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