DSL Drives Broadband Growth Worldwide

Touting research that showed the world’s DSL broadband connections grewby more than 30 million subscribers in the year ending in June, the DSLForum claimed the broadband technology is doubling and dominating broadbandcable connection growth.

Analysts pointed out that there was a sizeable gap between DSL and broadband cable deployments, which used to dominate high-speed connections. But they reinforced the forum’s findings of DSL growth, citing as reasons price, ease of deployment and technological advancement.

The DSL Forum research, conducted by Point Topic, indicated that in theyear leading up to June 2004, global DSL subscribers reached 78 million ata rate that was double that of other technologies, including cable. PointTopic reported that overall broadband subscribers grew globally to 123million in the same period, a growth rate of 55 percent.

Value and Vanity

Meta Group senior analyst David Willis told TechNewsWorld that the DSLand overall broadband growth, particularly in the U.S., was being driven bya number of factors, but was really a recognition of the value of broadbandto consumers.

“They’d like to have the latest and they’re trying to keep up with theJoneses,” Willis said. “It’s required suburban jewelry.”

Beyond the increasing market demand and psychological factors, Willissaid DSL technology itself has improved to allow better coverage andconvenience. Price drops on the equipment side, for DSL modems for example,and the ease of setting up connections have also helped drive growth, Willissaid.

Products and Price

Willis said while DSL may be viewed simply as high-speed Internet servicein the U.S., the technology is viewed and used more robustly outside ofNorth America.

“The rest of the world views DSL in a different way, and carriers see DSLnot only as a broadband delivery mechanism, but often as a way to deliverentertainment services and voice services,” Willis said.

He referenced PointTopic’s finding that China is leading the world in delivery of DSL broadbandservices, referring to the “multi-service capabilities” of the DSLtechnology throughout Asia.

Willis — who said DSL’s capability and image is changing in the U.S.thanks to efforts such as AT&T’s CallVantage and those from Vonage — addedthat while price cuts had been largely responsible for DSL’s North Americangains, cable broadband providers have not responded.

“The cable guys haven’t reacted by dropping price — yet,” Willis said. “Ithink they’ll have to,” he added, referring to DSL Internet service that isunder US$30 in some bundled packages.

Both Broadbands Growing

Forrester analyst Lisa Pierce said that compared with a couple of yearsago, DSL has grown at a faster pace than cable because the barriers ofinstallation, ordering and customer service have been addressed.

Pierce told TechNewsWorld that new DSL capabilities have increasedbandwidth, allowing the technology to compete more effectively with cable.

The broadband analyst added that although cable companies continue toexperience good, healthy growth, their price points are higher, and that isdriving even more vigorous DSL growth.

DSL’s Tech Edge?

Frost & Sullivan industry analyst Imran Khan credited DSL gains tolower price and expanded deployment that has resulted from increased lineaccessibility and a lifting of line-sharing requirements by the FederalCommunications Commission.

Khan told TechNewsWorld that although he expects cable will continue tolead in terms of overall number of broadband subscribers, DSL might have atechnology edge because it is a dedicated line, making it easier to take onmultiple users. Cable broadband, on the other hand, can run into bandwidthissues in dense neighborhoods.

“DSL has a technical advantage because of that,” Khan said.

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