WOW's Hagen: price remains a factor in broadband adoption

Ethernet cables in on premise equipment

WOW may have jumped on the 1 Gbps broadband train recently, announcing availability in four markets this week, but the provider says that its customers’ decision to take a faster speed service is mainly based on price.

Gigabit service is available in Auburn and Huntsville, Alabama, Evansville, Illinois, and Knoxville, Tennessee.

WOW!’s 1 Gbps internet service, which is enabled by its DOCSIS 3.1 technology, is competitively priced at $70 per month with a two-year term agreement for a limited time.

RELATED: AT&T, WOW announce more 1-gig deployments

Cash Hagen, COO of WOW, said that while the provider continues to raise the speed bar across its broadband portfolio, consumers’ adoption is largely driven by price.

“I would tell you that the decision is still very much a price-based decision and not a speed-based decision,” Hagen said. “If they can get it at the price points that they see value (in) then the speed becomes easy, but their decision is a price one.”

As it sells to each customer, WOW has always tried to work with each customer to understand how they use their broadband connections. In the home, the service provider will ask the customer how many people are in the home and what kinds of applications are they using.

Hagen said that WOW wants to sell each customer the best broadband speed that meets their needs. “WOW historically has done needs-based selling, meaning what is the profile of the home and how many are in the home and getting an estimate on simultaneous usage,” Hagen said. “We try to help the customer and point them in the right direction.”

While 1 Gbps is the latest and greatest service, WOW is raising the bar of its lower speed offerings, launching a 300 and 600 Mbps tiers over its existing DOCSIS 3.0 network.

“Having a high internet tier at a couple hundred dollars a month really does not solve for anything other than saying on a billboard we got it,” Hagen said. “That’s why as we were planning for 1 Gbps we launched a 300 Mbps and a 600 Mbps service which are market wide for all sub $100.”

Each of these tiers comes with a contract, but the key point is that they are offering a range of speeds that are under $100.

“Those speeds are tied to a contract, which is nothing other than driving some contractual loyalty and trying to minimize churn where we can,” Hagen said. “All of these tiers are purposely priced under $100.”