Getting Up to Speed with Residential Broadband

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Getting Up to Speed with Residential Broadband

By Paula Bernier, Executive Editor, TMC  |  May 07, 2015

Who wants and can deliver broadband services to people in the U.S. remain two areas of hot debate in this country.

To the first point, there’s a discussion as to whether there is enough consumer demand out there to justify gigabit-speed broadband in some areas. Some large broadband services providers – including CenturyLink, Comcast (News - Alert), and Mediacom – say there simply aren’t enough folks out there willing to pay the price for super-fast broadband, so investment on this front doesn’t always make sense. Others, meanwhile, say that’s just poppycock.

A recent blog by INTERNET TELEPHONY columnist Peter Radizeski of RAD-INFO (News - Alert) Inc. points to reports that gigabit services are seeing very limited demand. Fewer than 25 customers buy Chattanooga ECB’s gigabit broadband services, according to the piece, which quotes CenturyLink CFO’s saying that “no one takes a gig service.”

And a March 1 story in The Des Moines Register asks why the Iowa capital city isn’t a gigabit city. It says ISPs attribute that to a lack of demand. That’s what is stopping CenturyLink, which rolled out gigabit speeds to 16 cities last year, from offering this level of service to residential customers in Iowa, according to the piece.

However, the same article in the Register talks about how co-op Citizens Mutual Telephone Cooperative recently unveiled a gigabit service, although it’s aimed more at business and less at residential customers, and Western Iowa Networks has made available gigabit download speeds in Breda, Carroll, and other Iowa cities.

Elsewhere on the gigabit-speed broadband frontier, Farmers Telecommunications Cooperative of Alabama in February announced it is delivering fiber-based gigabit services in DeKalb and Jackson counties. And gigabit-speed Google (News - Alert) Fiber is now live in Kansas City, Provo and Austin; and is expected to be available in the future in Atlanta, Charlotte, Nashville, and Raleigh-Durham. Google Fiber is also looking into bringing its services to Phoenix, Portland, Ore., San Antonio, Salt Lake City, and San Jose. (Word is that 75 percent of those passed by Google Fiber subscribe.)

“Those divergent strategies [between big and small broadband providers] are the biggest reason why Cedar Falls, population roughly 40,000, has universal gigabit connectivity, while Des Moines, five-times larger, has only piecemeal access,” according to The Des Moines Register. “Yet while those smaller firms are rolling out gigabit availability to residences, larger companies such as Mediacom and CenturyLink are holding back in Iowa. Those companies argue they have the technology to provide the speeds, but it doesn't pay right now.”

The article goes on to reference information provided by Ed Pardini, Mediacom's senior vice president of field operations, that less than 4 percent of Mediacom's customers subscribe to speeds above 100 megabits per second.

Meanwhile, a January Techlicious blog talks about how although the technology to offer gigabit services has been around a long while, Comcast is just now offering a half-gigabit service “for a beyond insane monthly fee of $399.95 (with three-year contract required).”

Although most people clearly don’t want to shell out exhorbitant fees for high-speed broadband, the blogger writes, it’s just plain silly to suggest consumers don’t want faster Internet. And he goes on to say that, given moves like Comcast’s effort to buy Time Warner (News - Alert), the big broadband players could gain an even stronger hold on the broadband market, which will only lessen their interest in expanding faster broadband and making it more affordable.

Running alongside this commentary about whether or not significant consumer demand exists for 1gig broadband today is the discussion about whether or not munipalities should be allowed to build broadband networks when they feel incumbent service providers are not adequantly meeting their networking needs.

The Federal Communications Communications in February pre-empted North Carolina and Tennessee state laws banning municipalites from building their own broadband networks. Petitions from Chattanooga, Tenn., and Wilson, N.C., prompted the move. And although many believe this is a step in the right direction, it’s only a step, as the FCC ruling applies only to the two states mentioned above.

The fact that the Federal Communications Commission just updated its broadband benchmark speeds to 25mbps downstream and 3mbps upstream would seem to further justify some municipal builds on this front.

The problem, notes Bill Gerski, vice president of sales for Huawei (News - Alert) USA (the subject of this issue’s cover story), is that municipalities first have to find the financing for such builds, and many are having a hard time getting the loans to do it. Nonetheless, Gerski said, there is great potential for Huawei to work with munipalities in the next three to five years, and the company is offering the solutions and pricing – and, where needed, connections to help customers find financing for these projects – to help such efforts move forward. 

Edited by Dominick Sorrentino