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Broadband: A Bright Spot In Lagging Telecom

Consumer service revenues for telecom providers in the U.S. are expected to deteriorate over the next several years, falling to $106.7 billion in 2009 as decreasing revenues for voice services and dial-up outweigh revenue increases for both cable TV and broadband services, reports In-Stat. Broadband, however, will be a significant revenue growth generator, with market penetration growing from 28.6 percent of the population in 2004 to nearly 50 percent by the end of 2009. "The migration from dial-up to broadband is good news for service providers, as the monthly fees for broadband will remain substantially higher than for dial-up," says Amy Cravens, In-Stat analyst. "With $13.7 billion in broadband revenues in 2004 versus $10.9 billion in dial-up revenues, broadband has already outpaced dial-up as a revenue-generating opportunity." Total consumer spending on communication services, including local voice, long distance, cable TV, dial-up, and broadband was $114.8 billion in 2004. By 2009, broadband services will generate $15 billion more per year than dial-up. According to In-Stat's 2005 Consumer Telecom Survey, 35 percent of respondents currently purchase multiple services from a single provider.

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