Broadband: Fibre cheaper than cable

A significant price reduction for FTTx services worldwide has taken the average cost of broadband over fibre below that of cable in the last quarter. The data comes from the latest research by Point Topic on global broadband tariff benchmarks, using data to 30 September 2006.

According to the report, FTTx tariffs went down 12 per cent to US$28.1, 3 per cent lower than the average monthly rental for cable modem services.

"Consumers' preference for DSL and cable modem services remains very strong, but FTTx is certainly catching up, thanks in part to this price cut", says Vince Chook, Analyst at Point Topic. "If the decline continues, it is very likely that FTTx will overtake cable modem to one of the main players in high-speed broadband services in the future."

As compared to Q2 2006, the general downward trend of broadband service pricing for DSL and cable modem service slowed down slightly. The average monthly rentals for DSL and cable modem services only dropped by a mere 2.5 and 2.1 per cent respectively.

"DSL rentals had been undergoing major price reductions since the beginning of 2006", points out Vince Chook. "But with such a small drop over the quarter, cable modem is certainly losing its price competitiveness", he adds.

The average DSL monthly rental is now under US$25 at PPP (purchasing power parity) rate - US$4.5 less than the average for cable.