Verizon Introduces 2-Gbps Service In New York, at Prices as Low as $120 Per Month

With the news that Verizon is introducing 2-Gbps symmetrical fixed network access in New York for about $120 (using autopay), along with Comcast’s similar moves to 3 Gbps, we see continued improvement in home broadband in the U.S. market, and a continual movement towards 10 Gbps service. 

Comcast prices its 3-Gbps service--available nationally--at about $300 a month, making it a service mostly appealing to business users. The service also has a $1,000 install fee. 

The Verizon 2-Gbps service clearly is aimed more squarely at the top end of the consumer market, while also having appeal for business users. 

At the same time, the increasing speeds also are accompanied by lower prices. 

According to a new study, U.S. home broadband prices have fallen since 2016, says Broadband Now. 

Broadband Now says that the average price for internet in each speed bucket starting in the first quarter of 2016 compared to the fourth quarter of 2021 has fallen:

• The average price decreased by $8.80 or 14% for 25 – 99 Mbps.

• The average price decreased by $32.35 or 33% for 100 – 199 Mbps.

• The average price decreased by $34.39 or 35% for 200 – 499 Mbps.

• The average price decreased by $59.22 or 42% for 500+ Mbps.

source: Broadband Now 

U.S. home broadband prices have fallen since 2016, according to a study by Broadband Now. 

Broadband Now says that the average price for internet in each speed bucket starting in the first quarter of 2016 compared to the fourth quarter of 2021 has fallen:

• The average price decreased by $8.80 or 14% for 25 – 99 Mbps.

• The average price decreased by $32.35 or 33% for 100 – 199 Mbps.

• The average price decreased by $34.39 or 35% for 200 – 499 Mbps.

• The average price decreased by $59.22 or 42% for 500+ Mbps.

source: Broadband Now

A Handful of Hyperscale App Providers--and Video--Drive Global Internet Traffic

There is a simple reason why hyperscale app providers  now drive global data traffic. The single greatest driver of WAN demand is movement of traffic between a handful of hyperscale app provider data centers.

In 2021 just six firms generated 57 percent of global traffic, and much of that WAN traffic supported data flowing between hyperscale data centers. In 2021, intra-data-center traffic was about at the same magnitude as data consumed by retail end users.  

moving between data center locations.  

source: Cisco 

About six firms are responsible for about 57 percent of 2021 WAN traffic, according to Sandvine. 

source: Sandvine, IN Forum

These days, voice demand is paltry in relation to content bandwidth--largely video--that flows between hyperscale application provider data centers and internet points of presence where local internet service provider traffic pours onto the backbones.

Digital Transformation is Safer When it is "Smaller"

There is a good argument to be made that digital transformation is so prone to failure that a safer strategy is avoid "big" goals and instead concentrate on numerous "smaller" goals, even when the outcomes from many smaller projects do not necessarily transform firm earnings or profits in any directly-measurable way.

By definition, failure on a small project does not jeopardize firm survival.

By some estimates digital transformation spending will top $6.8 trillion by 2023. But those investments are “often made without seeing clear benefits or ROI,” says Tomas Chamorro-Premuzic, chief innovation officer at ManpowerGroup, a professor of business psychology at University College London and at Columbia University, 

Some argue digital transformation failure rates are 70 percent to perhaps 80 percent or more. To be sure, that failure rate includes projects that fail to reach their objectives, but might arguably have some benefits. Still, some argue 73 percent of such projects fail to provide any business value at all.  

While that might seem outlandish, it is well within the parameters of failure rates for less-complex projects such as information technology initiatives, which also fail at about those rates. 

And digital transformation is nothing if not hugely more complex. In fact, it might be so complicated that no single technology change, in any one part of the business, actually captures the magnitude of necessary changes. 

While 85 percent of CEOs accelerated digital initiatives during the pandemic, most can’t articulate their overall strategy and progress beyond that they made a tech investment,” say consultants at Deloitte. 

“If CEOs can’t say their digital transformation resulted in new business advantages or adaptability, then they haven’t really transformed,” Deloitte consultants note. 

source: Deloitte  

Crypto at the Inflection Point?

With the caveat that important consumer technology products do not always succeed, the cryptocurrency adoption curve does presently seem to track use of the internet. Cryptocurrency adoption seems to be a classic S curve.  

source: Wells Fargo 

The important takeaway is that cryptocurrency might be at an inflection point. 

source: World Economic Forum

U.S. Home Broadband Prices Have Fallen in Every Speed Tier Since 2016

U.S. home broadband prices have fallen since 2016, according to a study by Broadband Now. 

Broadband Now says that the average price for internet in each speed bucket starting in the first quarter of 2016 compared to the fourth quarter of 2021 has fallen:

• The average price decreased by $8.80 or 14% for 25 – 99 Mbps.

• The average price decreased by $32.35 or 33% for 100 – 199 Mbps.

• The average price decreased by $34.39 or 35% for 200 – 499 Mbps.

• The average price decreased by $59.22 or 42% for 500+ Mbps.

source: Broadband Now

RFOG as a Bridge to Other PONs

A recent report by Point Topic notes that at the end of 2021, Virgin Media O2 had gigabit per second capability across its entire 15.5 million home footprint.

Openreach passed 5.8 million fiber-to-home locations while three million U.K. premises were passed by independent fiber networks.

Virgin Media premises passed by Gig1 and RFOG broadband technologies

	Premises passed, Dec 2021	Premises passed, Sep 2021	Premises added, Sep – Dec 2021
Docsis 3.1	15,484,086	11,554,960	3,929,126
RFOG	1,002,857	979,457	23,400

source: Point Topic

One point of interest is the access platform Virgin O2 uses for about a million of its passings. Called “radio frequency over glass,” RFOG is useful for compatibility with hybrid fiber coax networks, especially when a node split has to be implemented. 

So RFOG is a passive optical network and is a way to implement DOCSIS services over a FTTH network. 

Although in principle RFOG--as a PON--might be a protocol a cable operator could run longer term, it does not appear that Virgin Media O2 will do so when it converts its HFC and RFOG networks to function as a wholesale network, in addition to supporting its own needs. 

The value of RFOG is its backwards compatibility with HFC. That will not have value for new wholesale customers likely to be most interested in using the wholesale network to support internet access operations. 

And few of those potential customers are likely to have a need for backwards compatibility with HFC or the DOCSIS protocols.

Stablecoins and Disintermediation

Should they come into wider use, stablecoins could disintermediate other financial middlemen. Used either as a store of value or a medium of exchange, stablecoins could allow users to  settle transactions near-instantaneously without using an intermediary that facilitates settlements. 

source: Federal Reserve 

Many note the value for cross-border settlements, which take time and can be costly. “Firms are also using institutional stablecoins to near-instantly move cash across their subsidiaries to manage internal liquidity, and to facilitate wholesale transactions in existing financial markets, such as intraday repo transactions,” say Gordon Y. Liao and John Caramichael in a paper developed for the U.S. Federal Reserve.  “And finally, because public stablecoins are programmable and composable, they are used heavily in decentralized, public blockchain-based markets and services, known as decentralized finance or DeFi.”

Stablecoins are digital currencies that peg their value to an external reference, typically the U.S. dollar, and are recorded on distributed ledger technologies such as blockchain. 

The potential disintermediation is clear: “If stablecoins were to see broad adoption throughout the financial system, they could have a significant impact on the balance sheets of financial institutions,” say Liao and Caramichael.