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Faster broadband speeds drive more switching than lower fees

New research from Parks Associates (www.parksassociates.com) shows that nine percent of U.S. broadband households switched broadband providers in the past 12 months, with 35 percent of them doing so to get a faster broadband speed. Only 18 percent of switchers changed because a different provider offered a lower price at a comparable speed.

“For many, broadband is a necessity for the home. No one wants slow or spotty service, and consumers are quick to switch if they encounter problems,” said Brett Sappington, Director of Research, Parks Associates. “Operators are promoting broadband speeds of 100 Mbps or more. While 43% of subscribers do not know their current broadband speed, they do know about the experience that they have online, particularly as it relates to digital media. Respondents who own multiple connected entertainment devices are more likely than others to plan to upgrade their broadband service. Very high speed services, including gigabit-speed offerings, will be the next stage of competition among operators. Though few consumers today actually need that level of throughput, consumers are willing to pay to ensure that they do not encounter slowdowns or other performance problems.”

The Parks Associate research shows over one-fourth of U.S. broadband households believe that their broadband speed is faster than needed, while 10 percent plan to upgrade to a more expensive but faster service.

“Consumer expectations for their broadband service are changing as they add more devices and adopt new habits,” Sappington said. “For example, 34 percent of consumers who regularly watch Internet video on a tablet plan to upgrade their broadband service. What was fast enough yesterday could be too slow today – it all depends on the quality of their experience and new devices in use.”

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