DSL Beats Cable In New Subscribers

DSL service providers signed up 200,000 more new subscribers in the last 12 months than cable operators, but the effort came at the expense of revenues, a market research firm said Thursday.

Over the last four quarters, DSL providers averaged 1.4 million new subscribers while their broadband rivals averaged 1.2 million, Parks Associates said. The findings reversed the trend from the previous four quarters, which saw cable operators leading in new-subscriber growth by the same margin of 200,000.

The DSL comeback, however, had its costs. In the first quarter of this year, the average revenue per user for DSL services was $34, compared with $41 for cable modem services, Parks Associates said. The widest difference was $18 between the DSL service provider with the lowest ARPU and the cable operator with the highest.

For the next few quarters, DSL service providers are expected to outpace cable operators in new-subscriber growth, the firm said. Consumer surveys found that among people intending to subscribe to broadband, 48 percent preferred DSL and only 18 percent chose cable.

Nevertheless, DSL providers will eventually have to boost ARPU through service bundles, Parks Associates said."Cable operators have leveraged their bundling strategies to conceal broadband price differentials and maintain strong subscriber growth while keeping a consistent ARPU and low churn rate," Yuanzhe Cai, director of broadband and gaming at Parks Associates, said in a statement.

Churn rate refers to the number of people who leave a service for another.