NTCA Finds Dramatic Growth in Broadband Take Rates
Rural phone companies are starting to see investments in broadband deployment pay off in higher take rates by their subscribers, the National Telecommunications Cooperative Association said Monday. In a report based on a member survey, the group found fiber deployment gaining on DSL and wireless broadband making steady gains. Overall, 99 percent of companies responding offer broadband to some part of their customer base, compared to 58 percent in 2000, it said.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
Small carriers argued for many years at the FCC and on the Hill that low take rates explained sometimes anemic investments in broadband deployment. But the report found “dramatic growth” in take rates the last year. “Providers that had deployed high speed services are now seeing their efforts rewarded as take rates continue to grow,” NTCA said. “Take rates for 1 Mbps service are now 9% (an increase of 50% over a year ago); for 3 Mbps, 6% (also up 50%); and for service in excess of 3 Mbps, 4% (a one year gain of 300%).”
“For many, many years the take rates have lagged far below availability and now it’s more ‘If you build it, we will come,'” NTCA economist Rick Schadelbauer told us. Once carriers had to “take a leap of faith” to invest in broadband, he said. “You can’t have subscribers if you don’t deploy,” he said. “But deploying costs a lot of money.” With take rates up, carriers can make an easier business case for investing in broadband, he said.
Another key datum was that while DSL remains the most commonly used technology, fiber is making rapid gains. Two years ago, only 12 percent of survey respondents reported using fiber to the home/fiber to the curb. That grew to 28 percent last year and 32 percent in the 2007 survey.
NTCA found that more subscribers want higher connection speeds. Six percent of subscribers are signing for services offering connection speeds of 3 Mbps, compared to 4 percent last year, and 4 percent to greater than 3 Mbps service, up from 1 percent last year.
Wireless offerings are multiplying. The survey found that 20 percent offer unlicensed wireless; 16 percent, licensed wireless service. “That’s something we've seen sort of inching up,” Schadelbauer said. “Whether we'll see any dramatic increase in wireless deployment is hard to say.”