Cable operator Cox Communications plans to deliver 1-Gigabit-per-second broadband service by the end of the year, following in the footsteps of Google and AT&T, which also have begun deploying such networks.
Cox CEO Pat Esser announced the speed hike during an interview Tuesday with Bloomberg TV at the NCTA's Cable Show.
"We're working on our road map now to bring gigabit speeds to customers this year," he said. Esser said in the next two to three weeks the company will announce which markets it will target with the service.
Cox's move to increase the speed of its broadband service looks like an answer to Google and AT&T, which are already deploying 1Gbps fiber-based networks.
Google was the first to make a big splash in the broadband market with its Gigabit Fiber deployments. The company is now offering a 1 Gbps broadband service over an all-fiber network in two markets: Kansas City and Provo, Utah. It's in the permitting phase of building its fiber network in Austin, Texas. And it announced earlier this year plans to build the network in 31 additional metro markets.
Phoenix is one of the markets that Google is targeting for Google Fiber. This also happens to be a city in which Cox is the largest pay-TV operator, with 578,00 subscribers, according to Bloomberg.
The competition from Google has spurred other major broadband companies to answer the 1Gbps call. AT&T has deployed fiber to residential customers in Austin, and it began offering a 300Mbps broadband service in December. The company plans to increase that speed to 1Gbps by the end of the year at no additional charge to consumers.
AT&T also has said it plans to expand its Gigabit fiber service to as many as 100 cities.
Esser claims Cox has had 1Gbps broadband on its road map for residential customers for some time. But he admitted that recent competitive announcements prompted the privately held company to announce its plans now.
"We're in a marketplace where a lot of people are making some noise" about these speeds, he said. "And people need to know our road map."
Esser also acknowledged that 1Gbps, which is 50 to 100 times faster than the service most consumers subscribe to, is overkill.
"Our customers want more speed," he said. "Not necessarily a Gigabit, but they want more speed. That's nothing new. We've been increasing speeds. But we want to be able to address a wide cut of customers."
So far, Cox is the only major cable operator to answer the Gigabit threat posed by Google and AT&T. Time Warner Cable, which competes with Google and AT&T in Kansas City and Austin, has raised the speed of its top-tier service in Austin to 300Mbps. But it has not announced any plans to increase the speeds in the network to 1Gbps.
Neither Comcast nor telephone company Verizon Communications have announced such an increase in speed.
Esser didn't comment on how much Cox will charge for the 1Gbps service. But if the cable operator wants to stay competitive with either Google or AT&T it will have to offer the service for around $70 a month. This is the price benchmark originally set by Google in Kansas City. AT&T sells its ultra high-speed service in Austin for $70, if customers allow the company to track their Web usage. For customers unwilling to permit this tracking, the service is priced at $100 a month.
This is a far cry from the $300-plus price tag of 300Mbps and 500Mbps broadband services from companies such as Comcast and Verizon Communications. Today, Cox offers new customers its top-speed service of 50Mbps for $61 a month with a six-month contract.