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US - Low Broadband Speed Retard Subscriber Growth in Q2 2008
Sep 19, 2008

Leichtman Research Group has revealed that the US broadband industry reached an all time low in seven years in Q2 2008 due to poor broadband speed.

The leading broadband and media research house Leichtman Research Group has revealed that there had been a sharp decrease in US broadband subscribers in Q2 2008 (April-June), plummeting to an all time low in seven years, reported WebProNews.

ccording to Leichtman Research Group, leading cable firms added 670,000 new subscribers, constituting 76% of net broadband gains for Q2 2008 spanning April-June. The number of new US broadband subscribers in the second quarter stood merely at around 51% of what was achieved in the same period in Q2 2007, with cable firms representing 85% more US broadband subscribers and 23% phone providers over the period April-June last year. Moreover, the number of new connections added over the Q2 2008 surged to 887,000.

The main reason for decrease in US broadband subscribers is the unsatisfactory broadband speeds all over the country. Majority of the US population get slow Internet speed which was responsible for the dwindling number of broadband connections, and thus, the declining number of broadband subscribers in the US. Although a few service providers are offering high speed net connections but their services are so overpriced that it is simply beyond the means of the average American customer.

One more reason for the fall in the number of broadband subscribers is the maturation of the broadband market. Approximately 90% of the current Internet users already have broadband connection, leaving limited scope for further growth. People who still don’t have subscribed to broadband are more price-sensitive, with some actually living in areas where broadband services have not been made available yet.

As per a Senior Research Analyst at RNCOS, “The US broadband sector is passing through a lean phase due to growing maturation. So broadband providers like telephone companies and cable operators should offer high-speed Internet connections at affordable prices to lure price conscious customers and expand to areas which are still devoid of broadband services.”

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