Virgin Media's announcement that it is going to release a 100Mbps by the end of the year means two things; firstly that the company could release it now if it wanted to and secondly that the competition is really heating up, which can only be a good thing for customers.
The broadband company that has become almost synonymous with fibre optic internet in the UK knows that keeping abreast of the rest of the competition in the broadband field is essential for its continued success.
It has been reaping the benefits of launching its ultra high broadband speed last year as more than 41,000 subscribers joined its 50Mbps, an increase of 81 percent in Q4 2009 over the previous quarter.
Interestingly that represents nearly two thirds of the new broadband subscribers that the company added during that same period which means that fast broadband is proving to be a major pulling force.
What's more, those buying the top end broadband service are also very likely to be the crème de la crème of the market, the one with the most disposable income and likely to stick with Virgin Media because of the internet QoS rather than the television or phone services.
It is not surprising that the company not only provides 50Mbps customers with much faster upload speeds but also remove any traffic management, providing with a wireless-N router and a number of freebies (unlimited online storage, 1200 free photo prints).
Virgin Media has already started to trial 200Mbps broadband service in Coventry (it started the tests in May 2009), which means that the company is likely to transition to 200mbps over the next two years, possibly before the 2012 London Olympics.
We suspect that they will essentially make ADSL2+ upgrades quasi obsolete by eliminating 10Mbps offers and making 20Mbps services their new entry level, thereby offering only three services while pricing the 20Mb package at around £13, a 50p increase over the current prices.
In comparison, Be Unlimited's up to 24Mbps service costs £17.88 while O2's Premium 20Mbps service is available for £15 for non customers.
We wonder how Virgin has managed to reach 200mbit speeds? Over the past few years, they have been able to essentially double their top speeds every few years or so. From 20 to 50 to 100 to 200mbps. Now H2O/Fibrecity and a few others could potentially change all this.