Recession forces some to downgrade to dial-up

The Chicago Tribune published a story Friday saying some cost-conscious Internet users are downgrading their service from broadband to dial-up to cut costs.

Some broadband users are considering going back to dial-up as the tough economic climate forces them to cut their household budgets, according to a story published Friday in the Chicago Tribune.

While it's unlikely Americans will ditch broadband for dial-up en masse, there are likely to be some people who find the $20 to $50 monthly fees for DSL or cable modem broadband service to be too high, when dial-up providers such as NetZero are offering new $9.95 service plans.

One Florida man, Arnold Zimmerman, 66, said that after his work hours got reduced and his stock portfolio tanked he was looking to make cuts.

"I didn't think I would ever go back," the Tribune article quoted Zimmerman as saying. "It was terrible. But with this economy, you got to look to cut wherever you can."

For several years, Internet users have been ditching dial-up Internet service for broadband service. But executives from United Online, which owns dial-up providers NetZero and Juno, said they saw the percentage of people dropping the company's Internet service hit a new low of 4.3 percent during the fourth quarter of 2008.

Still, broadband services have been growing strong for cable and phone companies. And even though some higher-speed services are pricey, consumers can still find cheaper alternatives, especially if they are able to get DSL service.

For example, Verizon Communications offers a 1 megabit per second service for $17.99 with a one-year contract. Subscribers must also have a Verizon phone line. But if they don't they can get the service for $19.99.

AT&T is offering a special promotion for its 768 kilobits per second service for $9.99 a month. The special offer applies only to new AT&T DSL customers. And subscribers must also have an AT&T phone line, sign up for the service online, and agree to a one- year contract. Current AT&T customers can get the service with the same restrictions for $19.95 per month.

But I'm not entirely convinced people will cut back at all on their broadband even as the recession worsens. As CNET News has reported previously, some consumers are actually increasing the speed of their broadband connections to access more entertainment at home. Instead of cutting broadband services, these consumers are cutting their cable or satellite services and are using their fast broadband connections to watch free TV from the Net. They're also watching some TV for free from over-the-air broadcast stations.

If you've got tips for saving costs by cutting back on technology, I'd love to hear from you. Please send me an e-mail at maggie.reardon@cbs.com.

 

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