The price of high-speed Internet access could be headed higher. Less competition opens the door for survivors to bump up rates because consumers have fewer alternatives. A plunge in advertising revenue is forcing providers to find other sources of revenue.
Demand remains high for broadband services.
Consumers have grown accustomed to regular increases in rates for utilities such as cable TV, natural gas and electricity. This may embolden broadband companies to up their own rates. If you're not making money on advertising and you've got objectives to meet, raising prices is one of the ways to do it. Charles Ardai, chief executive at Juno Online Services, echoes that sentiment. One major broadband provider already bumped up its rates, and there is speculation that even dial-up Internet leader America Online will raise its rates this year.