Wednesday, October 27, 2010

People won't pay a premium for faster broadband

Virgin Media, the UK cable operator, reported results today - and they are fascinating, leaving aside the announcements of 100Mb/s product and trials of 200Mb/s product with Prime Minister puffery.
NOTE: these are real speeds, not the DSL or HSDPA phantom lab speeds.
Hidden amidst this hype is the following: only 90k customers have taken up the 50Mb/s product so far. 610k are happy with 20Mb/s. 3.5m are happy with lower speeds.
So that's >3% who choose faster speeds at higher prices. Hmmm....

1 comment:

Rudolf said...

Funniest thing that, one would expect something different, all the marketeers are telling us that. Just imagine that, they've created all this complexity for 3% of the customers. What you don't hear is the costs associated with all this complexity. Billing systems are overloaded because of marketings failure, which increases costs at the IT department.

What we've seen here is that Free in France is right, fire marketing and deliver one excellent product for an excellent price. Thanks for providing me with numbers to back this up.