Broadband Subscriber Growth Slows

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The 19 largest U.S. cable and telephone providers – representing about 94% of the market – acquired over 2.1 million high-speed Internet subscribers in the third quarter, down 20% compared to 2.66 million a year ago, according to Leichtman Research Group.

The top broadband providers now account for over 60 million subscribers – with cable companies counting 32.6 million broadband subscribers, and telephone companies with about 27.5 million.

Other key findings for the quarter include:

•           The top cable and telephone providers essentially split the total net broadband additions in the quarter – this marks the first time in three years that cable has attained as many net additions as the telephone providers

•           The top broadband providers have gained 6.76 million broadband additions so far this year – compared to 7.97 million through the first three quarters of 2006

The top cable broadband providers have a 54% share of the broadband market, with about a 5.1 million subscriber advantage over the telephone companies

“Through the first three quarters of the year, net broadband additions are down 15 percent from last year’s record setting pace,” said Bruce Leichtman, president and principal analyst for Leichtman Research. “However, the top broadband providers are still on-track to add over 9 million subscribers in 2007 – a total that is very respectable given the maturing state of the broadband market.”

In related broadband research, LRG’s analysis of the Federal Communications Commission’s recently released report “High-Speed Services for Internet Access: Status as of Dec. 31, 2006” found that:

•           The top five states in residential broadband penetration as of the beginning of 2007 were New Jersey, Hawaii, Maryland, Massachusetts and Connecticut

•           The bottom five states in residential broadband penetration were Mississippi, West Virginia, Alabama, Arkansas and New Mexico

•           87% of cable broadband lines had speeds of over 2.5 mbps in the fastest direction – compared to 39% of the telephone providers’ DSL lines

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