Worldwide Broadband Prices Continue to Drop

Broadband subscribers all over the world are getting more their money. The cost for cable, fiber and DSL (digital subscriber line) subscriptions are all dropping, and at the same time speeds are increasing, according to market research company Point Topic.

DSL has seen the largest average worldwide price drop, 20 percent during the first three quarters of 2008. Broadband users paid $66.75 on average for a subscription in the first quarter and $53.32 during the third.

In comparison the average subscription prices for cable Internet was down just over 12 percent and for different versions of fiber access to the home, usually dubbed FTTx, was down by 6.5 percent.

The continued price erosion is primarily down to competitive pressure, according to Point Topic CEO Oliver Johnson. But the dire economic climate also plays its part.

There are still large differences in what broadband subscribers are paying for their access.

In the Middle East and Africa consumers are for example paying over $46 per megabit for DSL access, compared to Western Europe where subscribers are paying $6.23 per megabit, according to Point Topic.

The average price per megabit using DSL in the North America and Asia Pacific is $16.10 and $3.80, respectively.

Fiber is by far the cheapest access technology if prices per megabit are compared, it was four times cheaper than cable and ten times cheaper than DSL in the third quarter. When average monthly subscription prices are compared cable Internet is the cheapest option.

The future of broadband will increasingly be about fiber. When fiber has been put in place it becomes the dominant broadband access technology in four to five years, at the cost of cable and DSL.

“DSL is going to have a really hard time, and we will see a gradual erosion of its market share,” said Johnson.