Stand-Alone Broadband Adoption Increases from 34% in 2017 to 42% in 2020 -- Parks Associates

Stand-alone broadband, typically defined as broadband not sold in a bundle with pay TV, is growing in popularity, according to new research from Parks Associates. The stand-alone broadband adoption rate increased from 34% of U.S. broadband households in 2017 to 42% in the first quarter of this year, as evident from Parks Associates’ researchers.

According to the report the average stand-alone broadband subscriber now pays $60 per month and experienced a 36% cost increase from the first quarter of 2012 to the third quarter of last year. Customers who purchase both pay TV and broadband increased monthly payments from $107 to $127 over the same period.

The study looked at the impact of value-added services (VAS) and found that increased broadband speed is a bigger driver of increased average revenue per user (ARPU), but VAS could become increasingly important moving forward, Parks Associates said.

“Broadband growth has plateaued, so the next opportunity is in VAS,” said Parks Associates’ Research Director David Drury during a press release about stand-alone broadband adoption. “Providers have generally used VAS as a marketing tool to attract and retain subscribers, so for them to make the transition to a revenue source, companies need a clear understanding of the gaps in consumer satisfaction and demand for strategic and successful VAS deployments.”

Parks Associates also concluded that the COVID-19 pandemic is likely driving increased use of VAS, especially those that enable telehealth, video conferencing and remote learning. Almost one-half of US broadband households get at least one VAS from their provider, usually free of charge. Among broadband providers, customers of AT&T and Suddenlink by Altice have adopted the highest number of VAS, both free and paid options. The most commonly adopted VAS include support, antivirus, streaming video and WiFi.

The firm asked subscribers whether they have a service provider VAS and if they are aware that a particular VAS is offered. Roughly speaking, twice as many people are aware of their services provider’s VAS than the number of those who actually takes a VAS service. In addition to support, antivirus, streaming video and WiFi, other VASs are home security monitoring, parental controls, data use monitoring, cloud storage, smart home systems, identity theft protection and fall detection/health monitoring.