Consumers Dropping DSL, Cable for the iPhone?
Posted by: Olga Kharif on October 30, 2008
Less affluent consumers are jumping onto the iPhone bandwagon. According to a new comScore report, since June, iPhone adoption has risen 48% among those earning between $25,000 and $50,000 per year and by 46% among those earning between $25,000 and $75,000. These growth rates are three times those of people earning more than $100,000 per year.
comScore’s conclusion? More consumers are turning to the iPhone instead of gadgets like home computers to access mobile Web and e-mail. In effect, consumers are foregoing cable modems and Digital Subscriber Lines. That makes a lot of sense: I pay some $40 a month for DSL, plus $30 for a home phone line (required for ordering DSL), plus more than $50 for standard cell-phone service. That adds up to $120 a month, plus various fees and charges. If I can surf the Web, make calls and answer e-mail for $70 to $95 a month, that will translate into savings of at least $300 a year — and more than covers the price of a new iPhone.
As more consumers look to cut costs, and as more iPhone-like devices come onto the market, traditional telcos and cable companies will have to cut their prices to compete with such alternative wireless offerings — or to watch more subscribers walk out.