One big catch is that access to the new DOCSIS 3.1 technology will initially be available only on a trial basis, for which Atlanta-area residents must apply. The other catch is that the only way to get the $70/month price is to agree to a 3-year deal with Comcast. If you don’t want to be locked into that long of an agreement, your bill doubles to to $140/month.
So why, when Comcast charges $300/month for its fiberoptic service — not to mention upwards of $1,000 in installation and startup costs — is it willing to only charge $70/month to contract customers?
One factor has to be that, unlike the new fiber network, DOCSIS 3.1 doesn’t require Comcast to run an entire system of new cables. It uses existing cable lines, but can potentially deliver data at multiple gigabits per second. The customer will need a new modem, but overall Comcast doesn’t have to sink huge amounts of money into it.
The other major factor has to be competition. Both AT&T and Google Fiber are currently building out high-speed fiber networks in Atlanta. As we’ve already shown, AT&T shaves $40/month off its price when Google threatens to compete. In Atlanta, both companies are charging $70/month for gigabit Internet access, so Comcast’s $70 price point seems intended to compete.
That impending competition might also help to explain the 3-year contract requirement to get that price from Comcast. If the company can keep customers locked in, they won’t be as able to jump ship to another service as Google Fiber and AT&T’s GigaPower services expand in the area.
Google recently began expediting its Atlanta launch by partnering with the city to use some existing, municipally operated fiber lines to connect to certain apartment buildings in the area.
What about data caps? Google Fiber doesn’t have them, and neither will Comcast’s DOCSIS 3.1 service — at least not for contract customers. DSL Reports notes that those who agree to the 3-year contract will not be hit with data caps or overage fees, but customers who pay twice as much to avoid a contract will also face running up against usage caps… or pay even more money for unlimited access.
Comcast’s next launch city for DOCSIS 3.1 is Nashville, which — lo and behold — also happens to be a market where both Google and AT&T are building out fiber service. Other Comcast markets destined for the gigabit cable speeds are Chicago, Detroit, and Miami. Both Chicago and Miami are currently getting AT&T’s GigaPower service, but since there is no Google Fiber to compete at a lower price, the company charges $110/month in those markets. We wonder if Comcast will offer the lower $70/month price when it launches DOCSIS 3.1 in those cities, or if it will just shave off enough to compete with the $110/month rate.
by Chris Morran via Consumerist
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