Past Telogical Talks
Welcome to Telogical Talk, a weekly series where we analyze a slice of the competitive intelligence data collected by the Telogical research team.
As fate would have it, Mel Brooks' 1987 classic parody, "Spaceballs," provides the perfect framing device to describe today's internet speed arms race.
Top-shelf gigabit internet speeds used to be limited to a handful of markets. Fiber providers AT&T, Verizon FiOS, and others pressed their advantage while most cable providers worked to catch up with DOCSIS 3.1 upgrades that would support higher speeds.
In Spring 2018, after a spate of recent D3.1 rollout announcements from Comcast and Spectrum, as well as deployments from other industry players, gigabit availability has reached "widespread" status.
All (speed)boats have risen with the tide of gigabit. Many providers have bumped up speed tiers with no change in the underlying price. A common refrain for PR goes something like, "We've raised your speed XX times over the past XX years."
A question lingers: Do customers actually perceive this newfound speed?
Data
While internet speed tiers march upward, the services that customers use have relatively modest bandwidth needs. Even the most bandwidth-hungry application-- a UHD (4K) video stream-- only calls for 25 Mbps, according to Netflix, while most other video streaming services clock in at 3.5 Mbps to serve up a HD video stream.
DIRECTV NOW pads its number, recommending a 12 Mbps connection to the home, but based on its specs, that figure clearly reflects the expectation that multiple streams will run concurrently.
So how much speed does a customer actually need to do... everything? Below, an outlandishly implausible scenario provides a sense of scale.
Chart: The Ludicrous Scenario
Recommended bandwidth for popular internet services, summed to present a hypothetical total concurrent bandwidth requirement
Discussion
Even when driven to an extreme scenario, today's fiber and D3.1-supported internet speeds easily outmatch general consumer use of the internet. Outside of a speed test, customers may never get the sense that they are getting more for their money.
Understanding the customers' experience of speed requires more than simply provisioning it. To ensure the speed-value proposition does not erode, internet providers should look through the lens of how a customer uses connectivity and become trusted advisers who maximize that experience.
The following three areas should be part of any discussion about "improved speed" to improve customer awareness and satisfaction.
- WiFi network performance: pay special attention to router placement and size of residence; signal strength does not always correlate with signal quality, and very few consumers can diagnose deficiencies in their network configurations
- Connected device survey: legacy computers and mobile devices running old software will not become snappier with more internet speed
- Online destinations: on the day after Christmas, when downloads from the PlayStation Network or XBOX Live crawl under heavy demand, a frustrated consumer should know it isn't his or her ISP causing the bottleneck
Tesla's Ludicrous Mode provokes visceral reactions from riders who accelerate from 0-60 in under 2.5 seconds
Customers may never feel the thrill of being thrown back in their seats by accelerating internet speeds, but providers can do more to ensure they recognize the value of a well-engineered network that delivers consistent performance.
At Telogical, we’re always studying the competitive landscape. If you have a topic you’d like to discuss with us, please reach out. We look forward to working with you.