Comcast commits to doubling broadband speeds

Comcast President Steve Burke this week laid out the titan cable operator’s plans for fighting off the RBOCs’ DSL threat, beginning with a commitment to double the standard speeds of Comcast cable modems by the end of the year.

Speaking yesterday at Morgan Stanley’s conference in Boston and today at Merrill Lynch’s even in Pasadena, Cal., Burke said “our job No. 1 is increasing speed,” bringing downstream capacity of the typical cable broadband connection to 1.5 Mb/s, double the speed of most other MSO’s broadband connections, and as much as triple or quadruple the speed of most DSL lines.

Comcast has been testing its faster broadband service in Pittsburgh, Knoxville, Tenn., and Atlanta for the last three months, and plans to roll the service out nationally by the end of the year. At the end of the second quarter, Comcast claimed 4.4 million broadband customers and projected 5.2 million by the end of the year.

Since last year, the RBOCs have launched aggressive DSL pricing programs and marketing blitzes, geared at catching up in a broadband market the MSOs have dominated for years. Dropping prices to as low as $30 a month, and bundling DSL with other services, SBC and Verizon have managed to more than double their DSL installed bases in less than a year.

“Our competitive response to aggressive DSL pricing is to take our already thoroughly aggressive DSL offers and make them more aggressive,” Burke said, citing several promotional plans and bundle discounts Comcast has promoted in recent weeks. For the most part, however, cable broadband prices have remained far above the new DSL offers. In fact, Comcast significantly raised its prices in recent months for broadband customers not subscribing to cable programming.

Many industry experts, however, agree with Burke that cable’s big competitive edge is in its ubiquity of service as well as its scalable and consistent speed, which the RBOCs can’t match due to loop lengths. But pure speed may be rapidly losing its significance to the average consumer as the popularity of tiered 128 kb/s and 256 kb/s services have demonstrated.