Marketing

Cablevision: Broadband 101

5/02/2009 2:00 AM Eastern

Cablevision Systems will crank top broadband speeds up to 101 Megabits per second — the fastest advertised for any residential Internet service in the U.S. — with a launch set for next month across its entire New York-area footprint.

Optimum Online Ultra, priced at $99.95 per month for both consumers and business customers, will for now outstrip Verizon Communications's FiOS Internet, which delivers a top tier of 50 Mbps downstream for $139.95 per month.

Cablevision's 101 Mbps service “effectively establishes a new speed/price benchmark in the U.S. broadband market,” Strategy Analytics analyst John Lee said. “Competitors will not be able to sit idly by.”

Starting May 11, the Ultra service will be available to 5 million homes in New York, New Jersey and Connecticut passed by Cablevision's network.

The service is made possible via DOCSIS 3.0, the industry's next-generation cable modem technology, which bonds together multiple channels for higher throughput. The Ultra service will deliver upstream speeds of up to 15 Mbps.

In addition, Cablevision announced it will double the downstream speed of its Wi-Fi wireless Internet service to up to 3 Mbps. The service is available to the MSO's broadband subscribers for no extra charge at train stations and other “high-traffic” locations.

“Optimum Online Ultra firmly solidifies Optimum as the fastest Internet service in the home, at work and through the air over Optimum Wi-Fi,” Cablevision chief operating officer Tom Rutledge said in a statement. “This is a perfect complement to our existing high-speed data products, which are fast, reliable and far superior to anything available from our competitors.”

Verizon, for its part, characterized Cablevision's Ultra launch as “a parlor trick” and complained that the cable operator was delivering a service with questionable market demand. “For now, CVC's leap to 101 Mbps is about market positioning and bragging rights, rather than delivering a useful service to a mass customer market,” Verizon senior vice president of media relations Eric Rabe wrote in a blog post.

Unlike several other cable operators, Cablevision does not cap subscribers' monthly broadband usage and will not do so with the new 101-Mbps tier, spokesman Jim Maiella said.

And the Ultra service is not only faster than Verizon's FiOS Internet, it's also faster than its peers in the industry.

Comcast has been at the forefront among U.S. operators rolling out DOCSIS 3.0, aiming to bring 50-Mbps “wideband” service to 30 million premises by the end of 2009. Cox Communications has launched a similar high-speed tier in Louisiana, while Charter Communications has offered a 60-Mbps tier in parts of its home St. Louis market.

In Canada, meanwhile, Shaw Communications is offering a 100-Mbps DOCSIS 3.0 service priced at $249.95 per month Canadian (about $205 U.S.) bundled with another service.

Cablevision will deliver the Ultra service using Cisco Systems' DPC3000 DOCSIS 3.0 modems, which include a Gigabit Ethernet port and support up to 64 users.

Optimum Online Ultra provides business-oriented features that are also offered with the operator's 30 Mbps downstream/5 Mbps upstream Boost tier, including up to 15 e-mail addresses with 1 Gigabyte of storage per address and up to 12 Gbytes of Web hosting space.

Cablevision claims that Optimum Online has more than 75% market share among broadband services in its service area. At the end of 2008, it had 2.5 million high-speed Internet subscribers, representing a 52% penetration rate of homes passed.

The standard Optimum Online tier provides up to 15 Mbps downstream and 2 Mbps upstream.

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