Cablevision, which serves parts of the New York region, announced on Monday that it will sell premium broadband services with download speeds of 30 megabits per second and 50mbps to its residential customers. The company will also increase download speeds on its basic service from 10mbps to 15mbps at no additional charge to customers.
Cablevision's new speeds come just at Verizon Communications starts, fiber-to-the-home service in parts of Cablevision's region. Verizon's Fios network provides enough capacity to allow the company to scale its high-speed Internet service up to 100mbps in addition to providing television and phone service over the same pipe, the company said.
Verizon has spent billions of dollars in the past year digging up streets to lay the new fiber network in neighborhoods in half of the states where it provides local phone service. The base plan for Fios offers download speeds of up to 5mbps, with an upload speed of 2mbps for $39.95. For $49.95, consumers can get download speeds up to 15mbps, and for $199.95, users can download at 30mbps and upload at 5mbps.
Cablevision charges $49.95 for its basic Optimum Online broadband service, and it offers a $5 discount for customers that subscribe to both its high-speed Internet and cable services. New broadband customers can get the service for as little as $29.95 per month for a limited time.
Cablevision has not disclosed the price of its 50mbps service, which also offers 50mbps of upstream capacity. The 30mbps service, which offers 2mbps upstream, will cost an extra $14.95 per month, or $9.95 more for customers who also have a voice over Internet Protocol phone line, the company said. Cablevision said the service will be available to all of its customers throughout its network by the middle of 2006.
Cablevision isn't the only cable operator that isto compete. In May, Cox Communications boosted download speeds in its Northern Virginia territory to 15mbps. It began offering a similar service in Rhode Island in June, while Adelphia Communications announced that it is raising speeds to 16mbps to residents in Leesburg, Va. Both companies also compete with Verizon's new Fios fiber service.
Broadband is an important market for cable and phone companies because it generates substantial profit. The companies also believe that customers who use multiple services, or, from one provider will stick around longer than customers who buy only one service.