Cable Technology Feature Article
Do Municipal Providers Offer Best Deals on Triple Play?
By Gary Kim, Contributing Editor
One argument advanced in favor of U.S. municipal broadband services is that such networks offer much more attractive triple play prices than do commercial broadband service providers. In fact, that likely is the presumed case.
Among the complicating issues is that triple play services increasingly are the way most consumers buy their Internet access. Under such conditions, it can be challenging to estimate what Internet access actually costs, even if speeds and other terms and conditions are roughly equivalent.
A new analysis by Dr. George S. Ford, Phoenix Center for Advanced Legal and Economic Public Policy Studies chief economist, has found that triple play offerings sold by municipal systems in Bristol, Va., Chattanooga, Tenn., and Lafayette, La. cost “substantially more” than sold by private sector triple play providers.
To be sure, some will discount the findings, since large ISPs have economies of scale where it comes to providing video entertainment services, for example.
Still, the triple play price comparisons are perhaps surprising. One study suggests BVU, the municipal provider in Bristol, sells a triple-play service for $54.39 a month. Charter Communications (News - Alert), which competes with BVA, sells a triple-play service for $99.97, a difference of about $45. (Charter is a contributor at this week’s ITEXPO in Miami, Florida).
But Ford argues the comparisons are not “apples to apples.” That analysis compares a BVU broadband service of 6 Mbps, 27 channels of video (eight in high definition), and a fully-featured
phone service but without unlimited calling. No long distance minutes are provided;
the customer is charged $0.08 per minute interstate and $0.10 per minute in-state rates for
long-distance calls, Ford notes.
By contrast, the analyzed Charter service features 30 Mbps Internet access, 125 TV channels (60 in high definition) and unlimited calling. A similar package sold by BVA costs $150 a month.
The point is that, on a true “apples to apples” basis, Charter’s triple play service costs less than BVA’s service, Ford argues.
In Lafayette, Louisiana, a triple play service can be bought for about $71 a month from the municipal provider, featuring 15 Mbps broadband, 20 channels of service, and a
phone service with a few enhanced features and without unlimited calling, says Ford.
In that instance, the municipal offer seems arguably superior, at least in terms of price and broadband speed.
A different comparison, using AT&T’s $119 service, features an 18 Mbps broadband service, about 370 channels of video (with an HD DVR), and a fully-featured, unlimited-calling voice
Compare that to the Lafayette municipal service featuring 15 Mbps broadband service, a 290 channel video service, a HD DVR, and a fully-featured, unlimited-calling voice service. TLUS’s price for its triple play is $172.88, more than AT&T’s $119 price.
In Chattanooga, EPB sells a triple play service for $90.81, including 100 Mbps broadband, 12 channels of video and phone service without unlimited calling.
Competitor Comcast (News - Alert) sells an $80 service with 3 Mbps broadband, 45 channels of video and a fully-featured, unlimited-calling voice. For $160, Comcast sells a 50 Mbps broadband service with more than 200 channels of video and a fully-featured, unlimited-calling voice plan.
Comcast sells a package of 50 Mbps Internet access, 170 channels and unlimited usage voice for $140 a month. EPB sells a 100 Mbps Internet access package with 150 channels and unlimited calling for $139.
The point, says Ford, is that an apples-to-apples comparison can be made that shows either that the municipal service or the private provider offers the best deal.
Edited by Cassandra Tucker