Digital MarketingStrategiesDSL Growth Slows, Cable Modems Get Help from Standards

DSL Growth Slows, Cable Modems Get Help from Standards

DSL subscriber rates slowed in Q3 2000, according to Instat, while Analysys found the most advanced DSL markets in Europe to be in Germany, Spain, and the UK.

Deployment issues hindered the growth in shipments of ADSL modems in Q3 2000, while growth in shipments of cable modems, aided by the move towards DOCSIS-certified modems, increased, according to Cahners In-Stat Group.

“Overall subscriber growth in DSL grew at a slower rate in Q3 2000,” says Mike Lowe, senior analyst for In-Stat’s Advanced Carriers Service. However, this does not mean that the market for DSL will crash as has been predicted. “The slowdown in subscriber growth can be attributed to one-time events like the Verizon strike, and, despite this, the market still grew, but at a slower rate. We are confident that it will bounce back.”

As for cable modems, Lowe said growth will continue, but not as robustly as in Q3 2000.

“Now that DOCSIS is an established standard, we saw some manufacturers get into the game more tenaciously than they may have previously. However, we anticipate that slow build-out will limit growth going forward.”

Other findings of In-Stat’s research include:

  • ADSL modem shipments topped 1.85 million units in Q3 2000. This represented a growth rate of 35 percent over Q2 2000, as opposed to 46 percent quarter over quarter growth in Q2 2000.
  • Two-way cable modems grew at a 58 percent rate in Q3 2000, shipping over 2.79 million units. Q2 2000 witnessed a 39 percent quarter over quarter growth rate.
  • Cable Modem Termination Systems, previously reported as Head Ends, saw shipments of 6,355 units in Q3 2000.

A look at the European DSL market by Analysys found that Germany, Spain, and the UK are the most advanced DSL markets in Western Europe. Residential customers in these countries have the widest range of service offerings available, but even these markets have a significant distance to go to catch up with equivalent offerings in the US.

While the US offerings are tightly grouped, those in Germany have much wider variations in price, suggesting a high degree of experimentation by service providers to meet customers’ needs. Analysys said indicates that prices are currently not cost-based. A number of services in Europe are four to five times more expensive than similar offerings in the US, and consequently European users can expect prices to fall.

“A central factor to the more rapid development of the German, Spanish, and the UK DSL markets has been the role played by regulators,” said Michael Denmead of Analysys. “The German market in particular has a wide range of service offerings. To a large extent, this is due to the regulator introducing full local loop unbundling relatively early, and, crucially, taking a strong pro-competitive stance on price and network access.”

Analysys also found that large-scale deployment of DSL has begun in Belgium, Denmark, Finland, Germany, the Netherlands, Spain, Switzerland, and the UK. Greece, Ireland, and Portugal have yet to offer any commercial DSL services, while other Western European countries are in the early stages of service roll-out.

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