Population Statistic: Read. React. Repeat.
Thursday, February 26, 2021

It makes sense: During this economic crisis, the monthly household bill for broadband Internet access can seem like an unnecessary luxury. The surviving dial-up ISPs are pouncing on that notion by doubling-down on their marketing efforts to convince strapped consumers to revert to narrowband, because even a slow connection still “takes you to the same Internet”.

But how realistic is it to expect people to downgrade?

“It’s a smart move, in my opinion, for them to focus on the value message,” says Doug Williams, an analyst at Forrester Research.

He is skeptical, however, that dial-up services will attract many broadband users, pointing to a survey of U.S. consumers in which only 4% said they would downgrade their service and 2% said they would cancel it altogether.

Fact is, a step down in speed will appeal only to a very narrow slice of online users: Those who already don’t “live” on it, and access the Web a small handful of times a week to infrequently check email and such. Those folks probably got broadband only because they started experiencing peer pressure to do so — a regular flood of emailed hi-res pictures of their grandchildren, etc. They’re not going to miss the advantages of broadband because they never fully experienced them to begin with.

For the rest of us? Broadband makes all the high-capacity Web media that we experience possible. If anything, I expect the cable TV portions of the average household media-services bill to take a hit, precisely because more and more mainstream consumers are figuring out that they can get their television programming online for free.

In addition, there is a third way between household broadband and dial-up: Wireless-phone Web access. It’s not ideal, but if the broadband bill is so daunting, a bundled substitute could be the all-you-can-eat data plans that mobile phone providers are offering up. When you match them with true Web-enabled handsets like the iPhone, you’re really not downgrading by much.

And speaking of phones: Keep in mind that the base cost of an Earthlink or NetZero account doesn’t factor in the additional cost of maintaining a landline telephone in order to actually use dial-up. Granted, more households still have a landline than not, but a good chunk don’t — they’ve migrated to wireless-only phones for the entire house. Add it all up, and that ten bucks a month for slow Internet actually doubles — putting it almost in line with the average broadband bill of around $30. The savings shrink, for questionable return value.

So as logical as it may seem to see a resurgence in dial-up, I think the providers are indulging in a good bit of wishful thinking. At best, they’ll see a flattening of their market erosion; at worst, their existing low-end customers will start cutting the cord, and ironical to this strategy, the dial-up companies will finally go under thanks to the recession.

by Costa Tsiokos, Thu 02/26/2009 02:09:43 PM
Category: Internet, Society, TV
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