Comcast gets defensive with 2-Gig fiber service, Gigabit Pro

Comcast will soon bring 2-gigabit fiber internet to its customers in Atlanta, in a move it probably wouldn't have made had its competitors not forced its hand.

Comcast just announced it will offer a 2 gigabit-per-second (Gbps) residential service called Gigabit Pro in Atlanta next month. That's four times faster than Verizon Fios and twice as fast as Google Fiber. It looks like Comcast is tapping into its large, 145,000 route miles of fiber core network that hauls television and consumer and commercial internet.

With more than 1.5 million of Comcast's 22 million subscribers in the Atlanta area, it's a smart but defensive move. Google and AT&T are both planning on bringing Gigabit service to the Atlanta area later this year at about $70 per month, putting pressure on Comcast's top-end 505 Mbps Xfinity internet service that Ars Technica reported will be priced at $399 per month. Ars also reported that Comcast's 505 Mbps customers will be upgraded to the multi-gigabit service at a price below $399. The high-priced offering was possible without competition. Now with competition, the company needs to increase the speed by four times and decrease its monthly price from one third to one sixth.

The company wrote, "Comcast has been delivering multi-gig (up to 10 Gbps) Ethernet service to businesses since 2010. The company currently serves more than 1.5 million businesses nationwide." The offering relies less on investment in infrastructure and more on increasing the fiber termination skills of the craft people in the field from crimping CATV cable to polishing and splicing fiber. During the last 10 years, the company has been expanding fiber further out from its core network, bringing the interconnection point closer and closer to commercial and consumer customers.

Comcast's 2-gig offering looks more defensive than strategic. The company said that "Gigabit Pro will be available to any home within close proximity of Comcast's fiber network and will require an installation of professional-grade equipment." Comcast might as well have said "we'll offer fast and economical internet in those easy-to-access areas when AT&T and Google start laying fiber nearby." The professional-grade equipment also indicates a defensive move – had Comcast prepared for a consumer offering, equipment designed for consumer use would be ready with the announcement.

It looks like Google's strategy to promote faster internet worked. Google gave the impression that it wanted to compete with Comcast when it first announced Google Fiber in Kansas City. But Google really wanted to create demand for hyper-fast internet because the company's ability to monetize its users increases proportionally with internet access speeds.


Copyright © 2015 IDG Communications, Inc.

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