Re: SBC Slashing DSL Prices- Project Pronto?
Thread- Well maybe this does mean Project Pronto is for real. I sure hope so. SBC has a lot to live up to and they need those DSL customers to start signing up in droves. This should help.
BTW, SBC's DSL offer beats both Time Warner's Road Runner and GTE's Worldwind cable modem service. Both charge $40/month but also charge a $100 sign up fee. And it's only $40/month if the customer takes cable TV service too.
So in reality, SBC's DSL pricing beats cable modem pricing. -MikeM(From Florida)
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SBC SLASHES DSL PRICES
SAN ANTONIO, TEXAS, U.S.A., 2000 FEB 14-- In a significant move that may signal reduced cost and wider acceptance of broadband US Internet services, the corporate parent of Pacific Bell, Ameritech, Southwestern Bell, and other "baby Bells" is cutting the price of its digital subscriber line (DSL) service and waiving fees for equipment and installation. SBC is reducing the cost of its DSL services to $39.95 a month, a reduction of $10 a month from its previous monthly charge. And unlike many other broadband service providers, the cost of connecting to an Internet service provider is included in that monthly fee.
SBC is also waiving the fees for installation and needed equipment such as DSL modems, connection cables and network cards, which together would typically run consumers about $298, the company said. "Basically, what we're trying to do is gain market share," said Michael Coe, an SBC spokesman. "You get those connections to the house, but what do you do once you get those? We've had phone lines into the house for a long time - where we've been able to build value for our company and our shareholders is by offering additional services over those phone lines once we get that connection." Broadband service to homes, Coe said, is the company's "ultimate goal."
SBC's Baby Bell telephone services cover much of the nation. Pacific Bell, Southwestern Bell and Nevada Bell lock up much of the US southwestern states. Ameritech covers much of the northern Midwest, including Wisconsin and Illinois. And SNET, based in Connecticut, covers the southern New England states.
The move is an important one, said Jupiter Communications broadband analyst Joe Laszlo, adding that it is probably driven by inevitable competition from cable companies like AtHome and the Time Warner-affiliated Roadrunner service, both of which typically deliver broadband Internet access to homes for about $40 a month.
"I think it's definitely going to be a growing trend in the next year, in particular for Bell companies, to be very aggressive in how they're pricing DSL," Laszlo said. He said the move puts SBC pricing in line with DSL pricing at unaffiliated services Bell Atlantic and USWest. "But I think the big driver is the need to compete with the cable modem services." Laszlo noted that, in addition to less expensive connection rates, cable-modem Net providers don't usually include costs of equipment or installation, since most homes already have basic TV cable service.
"To really compete head-to-head with cable ISPs, it's important to do what you can to reduce those costs as well," Lazslo said. "So I think it's going to be an important thing for SBC to be doing, and it's certainly going to improve the competitiveness of its DSL offering."
The analyst said there is a question of how sustainable the savings from free installation and equipment will be for telcos like SBC. "What they're going for is trying to build deeper relationships with the customers, looking forward to the time when they can bundle services," Laszlo said. "If they get a DSL customer today, looking a year or two ahead, they'll hopefully be able to keep the customer and sell them a bundle that offers not just DSL and phone service, but also long distance, maybe even television services, as well."
He said, "The way I think they're looking at it is in terms of the long-term value of the customers they're acquiring for their broadband services today. It's easier to acquire someone with your broadband service for the first time than it would be to attract someone away from the other providers."
SBC's Coe mostly agreed with Laszlo's thesis, though he denies the move is driven by the cable industry[Ha. Ha!]. "We've been doing very well," he said. "We've been growing. We feel that when customers have a choice between cable modems and DSL, they choose DSL. The reason for that is guaranteed speed."
Laszlo discounts that factor. He said that as broadband services reach saturation in the market, it wouldn't matter much whether the access point is through DSL phone lines, or cable channels. In time, the differences in data speed through the pipes will even out at guaranteed speeds of somewhere around 128 kilobytes per second - not spectacular, but still enough to effectively convey bandwidth-hogging audio and video data.
Laszlo said that the key significance of the move by SBC today, given the size of the company's US footprint, is that it may force down prices of other DSL services across the country. "Certainly the fact that this will cover California, which is one of the relatively wired states in the country, means it does have big implications," the analyst said. |
