RealTime IT News

AT&T Shuffles Broadband Bundle Pricing

AT&T today launched its latest bid to win the hand of dial-up users. New residential AT&T phone subscribers can sign-up for AT&T Yahoo High Speed Internet service online for $12.99 per month.

The online-only pricing covers AT&T's High Speed Internet Express (384Kbps–1.5Mbps) and $17.99 High Speed Internet Pro (1.5Mbps–3Mbps).

Phone-based subscriptions add $4 to the price, according to Sarah Baker, an AT&T spokesperson. The offer requires a one-year commitment, after which the broadband packages return to $29.99 and $34.99 per month.

The broadband packages include 10 e-mail accounts with 2GB of storage, along with rebates on an AT&T wireless gateway or modem.

A similar price drop came from Verizon last year. The telecom firm offered broadband service for $14.99 per month with a one-year contract.

AT&T has "always been the most aggressive" when it comes to pricing, Boyd Peterson, analyst at the Yankee Group, told internetnews.com.

With cable broadband at $40 per month, "cable companies have to come way, way down," according to Peterson, who added that today's price drop will attract dial-up users. "Much of the growth in broadband is coming from converting dial-up users," said Peterson.

In light of the competition, AT&T is headed toward the bundling business. Telecoms hope to offer video services to compete with cable firms, Peterson said.

"[AT&T's broadband offer] is priming their pump for their video entry," he added. Bundling services is important to both telecoms and cable providers, and triple-play is "more than a savior, it is a necessity." Bundling reduces customer turnover.

While cable has always sold data services when people call for television, few people calling about their telephone service are pitched DSL. "How do they get the phone to ring? $12.99," Peterson said.