Broadband Subscriber Growth Slows

Associated Press

October 14, 2005

NEW YORK - Broadband subscriber growth started to slow in 2005, according to a new study from Kagan Research.

The Monterey, Calif.-based research firm forecasts 9.3 million net new broadband subscribers in 2005 — down from the 9.5 million in 2004. That figure is seen dropping off to 8.1 million net new users in 2006 with continued decreases thereafter. For 2009, Kagan forecasts 5.6 million net new broadband subscribers for a total of 72.4 million.

The slowing growth coincides with broadband's ascending popularity. This year marks when "high-speed data services have finally overtaken dial-up connections as the dominant pathway to the Internet for U.S. consumers," senior Kagan analyst Ian Olgeirson said in the report.

The firm estimates a total of 45.2 million broadband subscribers by the end of 2005, and 29.6 million dial-up users. A year ago, the ratio was almost even with 35.8 million broadband households and 35.1 million dial-up users.

Cable currently dominates the broadband market with roughly a 60 percent market share, though Kagan projects that will shrink to 53 percent by 2009.

Phone carriers, which are busy upgrading their networks, should see growing market share — from 35 percent in 2001 to 40 percent in 2009.