COLORADO SPRINGS — At Chapel Hills Mall, a kiosk selling Qwest products and services sits a few yards from one selling Comcast services.
While the proximity is indicative of the companies’ battle for the same customers, the fight is being played out in homes across the city as each company tries to bring its increasingly high-speed Internet capabilities to a greater number of customers.
What is happening in Colorado Springs is a microcosm for what’s going on nationwide. Phone companies, losing an increasing number of land-line customers, are trying to make up for those losses by pushing their high-speed or DSL services. At the same time, cable companies — whose fiber-optic lines deliver faster Internet speeds — are offering home phone service.
“Competition is getting white-hot between cable-television companies like Comcast and local telephone companies like Qwest,” said telecom analyst Jeff Kagan. Customers “used to do to business with both (companies), but soon they’ll choose one for everything and say goodbye to the other.”
A few months ago, Qwest rolled out faster high-speed Internet services in Colorado Springs and surrounding areas, boosting its 1.5-megabits-per-second download speed to 20 megabits per second. Comcast, on the other hand, has traditionally offered download speeds of 6 to 8 megabits, and that’s news for those customers in the area, which was serviced by now-defunct Adelphia Communications until a year ago.
Qwest does offer the increased speeds in Denver.
Comcast plans to roll out 50-megabit service in several undisclosed cities this year, although the service is already available in the Minneapolis-St. Paul area.
Both companies say that “take rates,” or the number of people signing up for Internet service, are better than expected here.
Getting the word out
Qwest is marketing its new titanium and quantum services with the traditional door-hanging fliers and advertisements and is even going to homeowners-association meetings to let residents know what’s available.
“We’re using a lot of different (marketing) tactics,” said Travis Leo, director of Qwest broadband services. “We’ve been pleasantly surprised. . . . We’ve really seen the (new high speeds) resonate with customers.”
Qwest is upgrading its network here, part of a $300 million upgrade that will bring faster speeds to about 20 Qwest markets this year. In addition, Qwest is bringing fiber-optic cable to areas it didn’t service in the past. That fiber-optic cable meets traditional copper wiring at specific points within a neighborhood to bring customers faster speeds.
Comcast built a new call center in Colorado Springs, adding about 300 employees within a year. In taking over Adelphia customers, Comcast is able to offer faster Internet speeds, along with video-on-demand and digital phone services.
Qwest doesn’t divulge specifics about how many people are taking a certain service in an area. But at Chapel Hills Mall, most Qwest customers were unable to recall how fast their home connections were.
“We’re pretty happy with it (Qwest DSL),” said Kim Asay, an area resident whose family has had Qwest services for about a year. She said she hasn’t thought about faster speeds, saying the bulk of their downloads are iTunes songs.
Paying a higher price for faster speeds is a deterrent for Alicia Mucher, a graduate student.
“Not right now, it doesn’t appeal to me,” she said while strolling through the mall. “We pay $32 for DSL.”
The “sweet spot”
But Qwest says its 12-megabit package for $46.99 is hitting a “sweet spot” for consumers.
“Overall, customers have the thirst and desire for faster speeds, and they want a reliable provider,” Leo said. “The average home no longer has one PC; people are seeing the need for faster speeds.”
Comcast counters that it offers a “power boost” to customers when downloading music and video files — when faster speeds matter most. A regular 6-megabits-per-second speed jumps to 12 megabits during these times.
“All they (customers) know is that the computer is responding quickly enough for them for the value they’re paying for,” said Brad Kaplan, vice president and general manager for Comcast’s southern Colorado region. “Whether you’re a gamer or e-mail user, you want the interaction as fast as you feel it is of value to you.”
Into the fray
Comcast says it welcomes the high-speed competition from Qwest.
“It really hasn’t changed the way we think about things. We think competition is good as long as it is on a level playing field,” Kaplan said. “We put a significant amount of money into our operations and into our network since we took over the Adelphia market.”
Regardless of whether customers know about or want faster speeds, both Comcast and Qwest are “future-proofing” their networks, in other words, adding more high-speed capability than they are currently offering.
“Customer speeds will increase. But if we look at the market today, the speed the average customer wants and is willing to pay for is roughly 3 megabits per second,” Kagan said. “Speeds over that are impressive to talk about but are not needed yet.”
Kimberly S. Johnson: 303-954-1088 or kjohnson@denverpost.com
The need for speed
Qwest
Previously: 1.5
megabits per
second (up to 7
in certain
areas)
Rolling out: 20
megabits per second. That service
is not available in all areas.
Comcast
Now: 6 to 8
megabits per
second
Planning: 50
megabits per second. That service
will be available in select,
undisclosed cities this year. It’s
now available in the
Minneapolis-St. Paul area.
