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DSL to Overtake Cable

Sep 1, 2000 12:00 PM, By EC&M Staff

According to Joshua Wise, an analyst with Allied Business Intelligence Inc. (ABI), Oyster Bay, N.Y., the demand for high-speed Internet access will increase from 2.3 million U.S. subscribers in 1999 to 42 million in 2005. This means a compound average annual growth (CAAG) rate of 162%. He forecasts the market will see a worldwide jump in broadband subscribers from 5 million in 1999 to 91 million in 2005, reflecting a CAAG rate of 160%.

A recent ABI report, "The DSL Solution: ADSL/SDSL Equipment & Subscribers," addresses the DSL market - focusing on ADSL, but keeping a strong year on SDSL and the rest of the DSL family in the United Sates, Western Europe, the Asia-Pacific Rim, and other areas.

There are two technologies available today that allow low-price, multi-megabit data transfer rates: digital subscriber line (DSL) and cable modem. So far, cable has been the clear leader, thanks in large part to its earlier market entry. As of the end of 1999, high-speed cable Internet service had 2.1 million U.S. subscribers, while DSL only had 500,000. In IQ 2000, some DSL providers were seeing 50% to 60% increases in subscription rates. The demand for DSL will maintain such an increase for another year; however, some local exchange carriers cannot deploy the service to meet the demand. Some providers are already experiencing backlogs because they can't train technicians fast enough.

In the coming year, DSL will rise in popularity due in part to advertising campaigns by DSL providers. As the subscriber base grows and the industry learns how to deploy DSL efficiently and economically (with help from the recent "line sharing" ruling by the FCC), the waiting lists will shrink and the "DSL horror stories" will become less common.

For more information, visit www.alliedworld.com.

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