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Comcast Tries Pay-as-You-Go Internet

Comcast Tries Pay-as-You-Go Internet 2/24/2013 7:00 PM Eastern

Comcast is test-marketing a relatively low-speed prepaid Internet service in the greater Philadelphia region — but the pitch may be too rich for the cost-conscious consumers the MSO is targeting.

Xfinity Prepaid starts at $69.95 for a kit that includes a cable modem and 30 days of access. After that, service costs $15 for seven days or $45 for 30 days of additional access, according to Comcast’s Xfinityprepaid.com website.

The MSO initiated the test last fall. The operator has no plans to expand the test beyond the Philadelphia metro area, which includes parts of New Jersey and Delaware, or broaden it to include prepaid TV or voice services, spokesman Charlie Douglas said.

The service offers download speeds of up to 3 Megabits per second and upload speeds of up to 768 Kbps. That’s compared with 6 Mbps downstream for Comcast’s entry-level Performance Starter tier, priced at $49.95 per month (with higher-speed packages even less in bundles).

Prepaid services are common in the wireless industry. Service providers like them because they generate guaranteed revenue and don’t require chasing down late payments or delinquent accounts.

Comcast’s marketing highlights the fact that the prepaid Internet plan offers pay-as-you-go pricing and doesn’t require an annual contract or a credit check.

With about three-quarters of U.S. households subscribing to broadband Internet service, it makes sense for wireline ISPs to target lower-income consumers, Leichtman Research Group president Bruce Leichtman said. “It can’t hurt to test the appeal of a prepaid offer and what price points might work best,” he said.

Others were more skeptical, suggesting Comcast’s current offer is too expensive. “It may make sense for people in temporary living situations, but I just don’t see a huge demand for this type of service in the U.S. market,” Broadbandtrends analyst Teresa Mastrangelo said.

September