Cable, Not The Phone Company, Will Win the Bandwidth Wars

Tiernan Ray writes:

...I n a 70-page report that arrived over the transom this afternoon, replete with diagrams and tables, [Sanford Bernstein analyst Craig] Moffett lays out the argument that after spending billions to build-out fiber-optics around the country, Verizon and AT&T will only be able to cover 40% of the population in the foreseeable future.  While broadband Internet becomes a must for most consumer households, only cable will be able to reach 60% of American homes with fast pipes.  So it makes no sense, he says, that the market is treating both cable stocks AND phone stocks as if both teams can win. ...

Link:  Barron's Online.  Thanks to mediaeater.  --Dennis

Comments

[Don Brontes]

I think the advantage that cable has is that it's already achieved high market penetration on the home front with television. A lot of consumers simply extend their cable service to include internet when they make the leap to broadband. I used cable before upgrading recently to a T1 connection

[Vic]

Well, the cable companies are already established in cities for broadband service. Especially when cable companies offer triple packages, phone companies can actually start to lose out.

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[Mark Tomin]

Indeed, most consumers don't have a choice of DSL or cable, they get whatever is available in their area. This is unfortunate because ISPs aren't directly competing with each other.

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