DSL Not Dead Yet

DSL isn’t a perfect technology. It’s slow and clunky, it’s not available everywhere and it’s sensitive to distance.

But is it on the verge of extinction? Laura Martin thinks so. The Media Metrics analyst says the fairly miserable subscriber numbers from AT&T and Verizon (which were released last week and this week, respectively) suggest that cable is stealing a share of the broadband market from DSL. The upshot, she thinks, is that DSL will become the equivalent of a narrowband service over the next five years — that is, it will become obsolete.

"DSL just isn’t fast enough," says Martin. "The benefit of DSL is that it’s always one speed, but as cable operators upgrade their networks, when their service slows down, it only gets as slow as DSL."

Even if speed is a top priority for many power users, though, there is still a significant percentage of Americans who don’t have access to either broadband or cable, so they’ll settle for whatever they can get — and that may mean DSL.

"Cable has historically offered faster speeds — both uploading and downloading speeds — but I think DSL is going to be around for a long, long time," says Doug Williams, an analyst with Jupiter Research. "Telcos are rolling out DSL in unserved communities, and that supports the idea that DSL is not going to be obsolete. It’s going to be one of the few technologies available for some people."

Williams also argues that because DSL is a more financially feasible broadband solution than cable, it’s potential market is larger, but Martin says that further proves her point that it will go the way of the pokey dial-up.

"It’s just like narrowband," says Martin. "People stick with DSL because it’s cheaper — the competitive advantage is its price point. But consumers are increasingly valuing their time more than the money they’ve saved on it. With the explosion of online video, DSL is just not an attractive option."

(As a side note: Everywhere we’ve lived, telecom carriers require you to have a land line in order to get DSL, which costs another $30 per month, and ultimately makes it more expensive than cable.)