Comcast announced Tuesday it will offer 100 Mbps broadband service to businesses in the Twin Cities as the company increases speeds on its network as a result of network upgrades.
The company is offering the service over its newly upgraded Docsis 3.0 network. The Minneapolis-Saint Paul region was selected as the first area to get the service because it is one of the most mature Docsis 3.0 deployments that Comcast currently serves.
Comcast hasn't provided a schedule for when the service will be expanded. But a spokesman said the company will eventually introduce it in all its markets that have been upgraded to Docsis 3.0. These markets include Boston and parts of Southern New Hampshire, parts of Hartford, Philadelphia and surrounding areas, Harrisburg, Pittsburgh, large parts of New Jersey, parts of Atlanta, Baltimore, Chicago, Ft. Wayne, Chattanooga, Portland, Seattle, City of San Francisco and the Bay Area.
Comcast's goal is to reach 80 percent of its national footprint this year with the faster Docsis 3.0 technology. Currently, it covers about 65 percent of its footprint. By the end of the year, if Comcast reaches it goal, its faster broadband service will be available in more than 40 million homes and businesses.
Comcast already offers 50 Mbps service to businesses and residential customers in these markets today. But now the company is stepping up its efforts with the 100 Mbps service.
Comcast's rival Verizon Communications doesn't yet offer 100 Mbps service for any of its customers. The fastest service available from the company's all-fiber Fios network is 50 Mbps. Verizon's all fiber network is capable of delivering 100 Mbps speeds, but the company says it hasn't seen a big demand for it from either residential customers or business customers.
"We offer 50 Mbps in every market we serve," said Bobbi Henson, a spokeswoman for Verizon. "We haven't seen a tremendous amount of demand for 100Mbps service."
But Comcast's Kevin O'Toole says there is demand from small businesses. He said that businesses, such as those in healthcare or real estate, which send large files are in the most need of more bandwidth. What's more, Comcast offers several other services along with the broadband service to make the service more valuable to business customers.
For $369.95 per month these businesses get access to Microsoft services, such as Microsoft Exchange email, which provides shared corporate calendar and address functionality, and Microsoft Sharepoint, which allows businesses to have their own intranet. Comcast also will offer these 100 Mbps customers hardware firewall protection and 25 seats of McAfee security. It also offers free web hosting and domain support.
Comcast isn't competing against Verizon's Fios service with this 100 Mbps service. It is actually competing with Verizon's and other phone companies' T1 data services. This is the kind of service that most larger businesses subscribe to from a telephone provider. Not only are T1 services expensive, in some places costing close to $1,000 a month, but T1 lines are also slow, only providing downloads of 1.5 Mbps.
Comcast believes that small businesses with fewer than 20 employees is an underserved market. And in 2006 it started its business service unit. The strategy of going after these small businesses has paid off. And iIn the second quarter of 2009, the company reported that the business services unit grew revenue by 51 percent compared to the second quarter of 2008.
This is an underserved market that really needs the speed of 100 Mbps service," O'Toole said. "Plus we offer them a great value when you look at the entire package."