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A Note on Slowing Broadband Growth

leichtman-research-group-lrg-broadband-growth-rate-slowed-2008

Leightman Research Group has come out with a report (via GigaOM) showing that the rate of broadband growth slowed in 2008 compared to 2007 and 2006. That makes sense. The industry is maturing and we entered a recession last year. However, it’s important to put the news in context. Even though the subscriber growth rate has declined, broadband usage rates have not. Comscore, for example, shows Internet users viewed a record 14.3 billion online videos last December.

Increasing broadband usage means two things for ISPs. First, they can sell new premium service packages with higher speeds to meet demand for multimedia applications. And second, subscribers are increasingly dependent on the broadband services ISPs sell. This opens the door for new broadband-based applications, many of which operators can leverage in their own service bundles. Most compelling is the opportunity to offer personalized, cross-platform applications that make use of multiple core services. Think television programs and promotional extras that can be accessed via the TV set, PC, or mobile phone.

In addition, while broadband subscriber growth has slowed, it’s still trending positive year over year. And as far as operators are concerned, they’ve also got TV and phone service in their bundles. Through the end of 2008, the growth rate for new pay TV subscribers was still increasing.