Tuesday, June 05, 2007

More bandwidth than you can use?

But once you have 100Mbps or more available at home, what the heck are you going to do with all that bandwidth? For the average consumer, 6Mbps should more than suffice for today's typical needs, whether it's downloading music, watching the occasional video, or even running a home network that lets two or three computers do the same all at once. Does anyone really care whether that song download from iTunes (AAPL) takes 10 seconds or 2 seconds?

We've been here before. In 1999, there were fewer than 2 million people in the U.S.

subscribing to either DSL or cable broadband. By the end of 2006, that number exceeded 51 million, says the Dallas consultancy Parks Associates. Meanwhile, prices have come down. In 1999, Bell Atlantic, now part of Verizon, offered consumers a high-end DSL package that topped 1.6Mbps for about $110 a month. Now it's offering 3Mbps for $30 a month.

That trend is going to repeat itself, says Parks Associates analyst Michael Cai. "You'll see more bandwidth offered at the same price you're paying now for less." The average cost of a megabit per second in 2002 was more than $26 a month, Cai says, and by last year it had dropped to $7. By 2010, it could drop as low as 80¢, making 50Mbps for $40 a month sound positively mainstream. 

From the article "More bandwidth than you can use?" by Arik Hesseldahl.

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