Qwest Crows Download Speed -- After CTO Questioned Value

(MoneyWatch)  Download speeds are to the telecom industry what megapixel counts are to digital photography: only part of the story and an unbridled attempt by marketing to bamboozle customers into perceiving value that may not be there. So it's not surprising that Qwest would join the bandwagon -- except that in an interview with me not so long ago, the company's CTO himself questions the use of similar numbers by competitors.

A Qwest PR person emailed me earlier today to note that the company today launched "the next evolution of its high-speed Internet services, delivering downstream connection speeds of 40 Mbps and upstream speeds of 20 Mbps." The accompanying press release quotes executive vice president Neil Cox as saying the following:

This is all about perfecting the customer experience by anticipating their needs and delivering products and services that often exceed expectations. By delivering the speeds customers want, we are able to complement their lifestyles with new capabilities that will enhance their broadband experience.

All well and good and entirely predictable. However, here's what CTO Pieter Poll said in the interview back on April 23:

Qwest's belief is that fiber to the home is not necessary for an exceptional broadband experience. For certain carriers, fiber may make sense. We have a very robust program around what we call fiber to the node that today delivers up to 20 mbps speed. We productize 7, 12, and 20, but technically we can deliver 20. We now are in the process of installing VDSL 2, which will allow us to offer up to 40 mbps. There are not that many places you can go to on the Internet today and achieve those speeds. If I am downloading a podcast, you don't typically see that podcast at the rate you have the broadband connection because of the ability of severs not having caught up with the speeds. The joke was that the one thing that delivers the [high speed Internet] experience is Internet speed tests to show that it's possible. What I'm excited to see is the change in Internet behavior, moving from bursty traffic and toward video.

Or, to put it differently, yes, it's faster, but most anyone using this simply won't notice the difference because traffic on the Internet itself is congested. The download speed doesn't matter if that connection to the house can't data from the Internet as fast. Poll did go on to say that greater speeds would become important ... eventually.

Even at the high definition experience max, you're talking about 8 megabits per second, and most of the high def streaming you're seeing is on the 5 megabits per second range with advances in compression. The 7 meg we have is the first tier that satisfies the consumer's demand for streaming experience. That is enough to satisfy one high definition experience in the home. When someone says I need 50 or 100 megabits per second, I believe those are a lot more about hype. I'm not convinced that the applications are there, or that some offering 50 or 100 meg have architectures to sustain streaming at that rate. Say 100 or so customers in our distribution area have our service. Qwest is ready to say that the architecture -- can support a simultaneous high def streaming expreience to every home that has the service. That still won't happen. That's true with TV. It's unlikely that everyone in a subdivision is watching a different TV channel. Today, the streaming experience is still the leading edge of customers. But the demographic of the millennials starting in the work force is leading that charge.

Eventually the demand for video over the Internet will push the need for higher bandwidth. But that's eventually, and today it's simply paying more money without getting measurably greater satisfaction. But then, there's technology and there's making money.

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