I have to wonder in what world industry analysts live. The Milwaukee Journal-Sentinel article on broadband prices’ dropping to dial-up levels discusses the End of Internet Access as We Know It:
“At some point, we may see dialup disappear – in three to five years,” said Lisa Pierce, a vice president at Forrester Research who specializes in the U.S. telecommunications industry.
Um, availability, anyone?
In the general case, it would seem that Ms. Pierce could be right. The cost of broadband Internet access is dropping. This will impact the number of customers who are using dial access, as the two services substitute for each other. However, she neglects the availability of various forms of Internet access, and the effect of sparse access on prices, which causes her prediction to fail in the specific case.
For example, Alice has broadband access available, but only over CATV. Because there is no DSL or fiber service to her address, and because satellite Internet access is even more expensive, there is no pressure for her local cable franchisee to reduce their price for Internet access. This may keep her on dial until the franchisee feels the competitive pain. Similiarly, her brother Bob and her other brother Bob, live in Middle-of-Nowhere and an Outer Borough, respectively, and so no broadband option will be available until the rural telephone cooperative on the one hand, and the municipal power company on the other, find the funds to provide access.
Meanwhile, the plain old telephone system is everywhere.