Saturday, August 3, 2013

When the Cable Company Decides to Offer Faster Broadband

The dominance of cable companies in the residential broadband space is an accepted fact of life. Those lucky few cities that are getting Google Fiber will get to enjoy a special perk--a not-so-dominant cable company. To get a sense of how the lack of competition hurts consumers, lets consider how a large cable company touts its new "high bandwidth" offerings.

Time Warner Cable Corporate HQ sign

The example we are going to be looking at is actually for commercial services offered by Time Warner Cable to businesses in and around the New York City area. The company will soon be rolling out "Wideband" data services that feature a new and improved top tier with (asynchronous) speeds of 100 Mbps (max) download and 5 Mbps (max) upload. How much will this increased bandwidth cost the average small or medium-sized business in Time Warner territory?

$403.99 per month. The price drops to $342.99 with a 2 year contract.

Without even considering any other fees or charges on top of those rates, think the marketability of such an offering in an environment where, say, a product like Google Fiber was also available. With synchronous 1GB speeds and an approximate cost of $70/month, it is clear that the cable company's offering would be absurd. The only thing that can spare consumers from the monopolistic stranglehold of the cable companies is true competition. It cannot come soon enough.

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