Cable Modem's Lead Over DSL Is In Jeopardy

Although cable modem service has a much larger market share of broadband services than DSL in the United States (67 percent vs. 29 percent at the end of 1999), its competitive edge may soon disappear.A recent survey conducted by Parks Associates, part of the company's Broadband Access @Homeô study, shows DSL making strong gains in key consumer areas.The survey contains a sample of almost 600 broadband users (cable modem and DSL) and over 6,000 dial-up Internet households in four MSAs - New York, Atlanta, San Jose, and Phoenix ñ where both cable modem service and DSL are available. Each RBOC is represented by one of the four MSAs. Some key findings from the survey include the following:Consumers are more aware of cable modem service than of DSL. However, respondents aware of both find DSL more desirable than cable modem services. Dial-up Internet users, who are the next broadband adopters, are more likely to subscribe to DSL than cable modem service when they upgrade their Internet service. Among these users who intend to upgrade their Internet service, 34 percent want DSL, compared with only 25 percent who would opt for cable modem service.Seventy percent of the broadband users surveyed say that they are satisfied with their service, while almost 10 percent say that they are not satisfied. Although there is no difference between cable modem users and DSL subscribers in terms of satisfaction, the former are more likely than the latter to churn under certain circumstances. For example, 41 percent of cable modem users say that they are likely to switch to an alternative service if they can get the same speed and save $10 per month, compared with 31 percent of DSL subscribers that have the same response.""The results from the survey are not surprising,"" said Hongjun Li, Director of Research at Parks Associates and the designer of the Broadband Access @Homeô study. ""Consumers generally perceive their telephone companies more favorably than cable companies, and this impacts their choice of broadband service providers. Although the cable industry has made impressive progress in improving customer service in recent years, it takes time for damages done in the past to be repaired.""For more information about the study, please contact Steve Harvey, 972 490 1113, or sales@parksassociates.com.About Parks Associates Parks Associates is a Dallas, Texas-based market research firm specializing in emerging technologies and services for the home. Founded in 1986, Parks Associates provides primary and secondary research on home systems, in-home networks, home security, consumer electronics, telecommunications, Internet service, energy utility, and subscription TV industries. Parks Associates' clients include both Fortune 500 companies and small start-ups. Parks Associates' services include syndicated reports, multi-client studies, custom consulting, workshops, and conferences