Thursday, June 9, 2011

Bandwidth costs continue to drop

Historically, both computer and telecommunications costs have fallen over time, and has been one of the factors driving the digital transition.  Still, it's nice to have regular confirmation of the trends.  Research firm Point Topic has released a report showing that consumer broadband prices per Mbps have continued to fall in the period between the fall of 2009 and the first quarter of 2011, particularly in the Americas.  Prices fell fastest in Latin America, dropping 40%, with consumer bandwidth cost falling 35% in North America.  The report suggests that the pressures driving prices downward are constant, with the broadband marketplace growing ever more competitive, and consumers actively seeking more value in meeting higher bandwidth demand.  As fiber-based broadband networks continue to expand, and the fiber comes closer and closer to homes, there is not likely to be any easing of the pressure for ISP's to offer more value.  As broadband markets increase competition, driving down basic bandwidth costs, firms will need to start competing via differentiating services - by adding valued services and improving customer relations.
That's good news for consumers.  The driving forces in the broadband marketplace are towards lower costs, better customer service and relationships, and the development of products and services that provide added value to the consumer.
In addition, the continuing decline in bandwidth costs will help feed the growth of Cloud services and the shift towards the use of streaming for the delivery of media content of all forms, as the costs of accessing and receiving digital content through the Net continues to decline.  As with computing, this push is likely to manifest itself in terms of consumers getting more for less - seeing a mix of dropping prices for higher bandwidth capacities.  This, combined with the continuing improvement of data-compression techniques, will make high-quality content (higher levels of HDTV, 3-D TV, etc.) seem more viable options for consumers.

Source: "Global bandwidth costs continue to drop, says report",

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