Two bright spots for the industry are the continued growth of broadband Internet and digital subscribers. Cable operators added about 900,000 new broadband Internet subscribers this quarter, nearly doubling the growth of the major DSL providers and continuing to hold a commanding 65% market share of the US residential broadband Internet market.
| Second Quarter 2002 |
Broadband Internet Subs |
Net 2Q Adds |
| Cable Modem |
| Time Warner |
2,466,000 |
271,000 |
| AT&T |
1,762,000 |
137,000 |
| Comcast |
1,168,900 |
128,400 |
| Cox |
1,115,000 |
113,689 |
| Charter |
905,500 |
157,800 |
| Cablevision |
610,505 |
50,740 |
| Adelphia |
377,500 |
NA |
| RCN (Overbuilder) |
149,602 |
12,807 |
| Mediacom |
145,000 |
18,000 |
| Insight |
103,400 |
8,900 |
| Cable One |
56,000 |
11,600 |
| Total Top Cable |
8,859,407 |
909,936 |
|
| DSL |
| SBC |
1,700,000 |
213,000 |
| Verizon |
1,500,000 |
150,000 |
| Bell South |
803,000 |
74,000 |
| Qwest |
508,000 |
24,000 |
| Covad (CLEC)* |
179,000 |
(1,000) |
| Total Top DSL |
4,690,000 |
460,000 |
|
| Total Broadband |
13,549,407 |
1,369,936 |
Sources: The Companies and Leichtman Research Group, Inc.
All data from Q2 2002, except Adelphia from Q4 2001 (last reported information).
Subscriber counts may not represent solely residential households. For example, Charter Communications notes that commercial accounts are calculated on an equivalent modem unit (EMU) basis, and represent about 8% of its modem subscribers.
* Covad subscriber counts reflect residential users only. Total subscribers (including business) are 357,000.
Digital cable rollouts also continued. Nearly 900,000 digital subscribers were added during the past quarter – maintaining the technology’s impressive growth curve.
This data has been created using company reports compiled and analyzed by Leichtman Research Group analysts.
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On the supply-side, direct broadcast satellite (DBS) providers have been leading the way in deployments of DVRs with about 650,000 DVRs deployed to date. With EchoStar’s no monthly fee-based offering, DBS providers are expected to continue to accelerate DVR deployments.
Leichtman Research Group forecasts that broadband Internet connections will grow by 25 million over the next five years (from about 12.5 million at the end of the first quarter of 2002 to 37.3 million by 2007).
While some have expressed public disappointment about the rate of broadband adoption in the US – much of this is the result of unrealistic expectations for broadband rollouts. The reality is that higher-priced broadband services have followed an aggressive adoption curve, and that this trend is likely to continue at a healthy rate for the next several years.
Digital cable services have quickly emerged as a key component in the cable industry’s efforts to protect their core customer base and generate incremental revenues. Since its introduction in 1996, these digital services have already shown its value and importance to the industry:
