A broadband broadside

After years of lagging cable broadband Internet services by a consistent 2 to 1 margin, telephone companies' broadband alternative has been zooming toward parity in gaining subscribers as high-speed Net service begins to achieve mainstream adoption.

And yesterday, Verizon Communications Inc. unleashed a flurry of plans to make its digital subscriber line services even more competitive with Comcast Corp. and other cable giants. The Verizon moves reflect the key role that broadband services are playing as phone and cable giants compete to win and retain customers with service bundles incorporating phone, television, wireless, and high-speed Internet services.

Over the next two months, many of Verizon's 2.7 million DSL subscribers will be notified that they can request a free service upgrade tripling their upstream Net access to 384 kilobits per second from 128 now, which makes transmitting computer files much faster and can improve connections for cheap voice-over-Internet services. Download speeds for the main Verizon DSL service, which costs $34.95 a month by itself or $29.95 combined with local and long-distance telephone, will remain capped at 1.5 megabits, and new customers will automatically get the new 384 kilobit service.

This summer, Verizon will launch DSL with downstream connections at up to 3 megabits per second -- matching Comcast cable modems -- at a yet-to-be-revealed price. Judy Verses, a Verizon senior vice president for marketing, said the price for the 3-megabit DSL will be "very competitive" with cable companies such as Comcast, which charge $42.95 a month for broadband for subscribers also buying TV or phone service, and $57.95 for those taking cable modems as a stand-alone.

And by year's end, Verses said, Verizon plans to:

Upgrade 7 million more phone lines to support DSL, including millions in rural areas where Verizon will use new technology that extends DSL availability beyond the current limit, which is generally a zone within three miles of a Verizon switching station. Verizon added DSL coverage to 10 million phone lines last year to make the service available to over 80 percent of its phone customers.

Offer a reduced-price voice-over-Internet service to compete with companies such as Vonage and BroadVoice and AT&T's new CallVantage service, which offer unlimited calls for $20 to $40 per month.

And deploy so-called naked DSL, which enables people to get a DSL connection without also having to buy local phone service from Verizon, so they can use a VOIP phone connection instead of more expensive conventional local phone service.

Over the past 12 months, according to a new Pew Charitable Trusts' Internet & American Life Project survey, DSL's share of the home broadband market has jumped to 42 percent from 28 percent. After tech-savvy early adopters flocked to faster cable modem offerings in the late 1990s and early 2000s, DSL's lower price -- typically $12 to $15 a month less than cable modem service -- has helped companies like Verizon attract a larger share of price-conscious households upgrading their Net service from a dial-up modem. Verizon and other phone companies have also greatly simplified the installation process, so many customers can buy and install their own DSL modem without help from a technician.

Deutsche Bank and Goldman Sachs analysts estimate that when complete first-quarter results are available from all cable companies, they will show that new cable modem sales only barely outpaced the 1.05 million new DSL lines added by Verizon and the three other Bell System local phone companies in the first quarter. In the first quarter, for example, Comcast added 394,000 cable modem subscribers, about a 7 percent increase, while Verizon gained 345,000, a nearly 14 percent growth rate.

Bruce Leichtman of Leichtman Research Group in Durham, N.H., a leading US cable broadband researcher, said: "For a long while DSL was sitting on the sidelines and watching cable build up a huge lead. DSL is not -- not with a capital N -- catching up with cable on total subscriber numbers, but what DSL is doing now is at least starting to play the game."

To Will Stofega, a telecommunications analyst with International Data Corp. in Framingham, Verizon's efforts to make DSL a stronger competitor for cable modems reflect the fact that "they've got to catch up with cable. That's clear. When you look at the subscriber growth numbers, they're rolling out a product at a lower price point, and you've got to take that into consideration."

Because the reach of DSL is limited to homes within a certain distance of a telephone switching station, Verizon's 3-megabit DSL will be offered only to homes within about 10,000 feet of a "central office" with DSL gear. Verizon did not disclose what percent of its customers will be eligible for the faster DSL. In contrast, Comcast's 3-megabit cable modem service is available to about 93 percent of the 40 million homes in areas served by Comcast cable.

Although some Canadian cable firms have begun offering lower-priced, lower-speed broadband services, US cable companies including Comcast have doggedly resisted, as many analysts think millions of cable modem customers would happily trade down to 1-megabit or 1.5-megabit service from 3 megabits if they could save $100 a year or more by doing so.

Comcast spokeswoman Jennifer L. Khoury said Comcast will be interested to see what price Verizon charges for the 3-megabit service and how many of its customers will be able to get it.

"We feel strongly that it's not just about the speed but what you do with it," Khoury said, citing Comcast's efforts to upgrade its portal with an array of broadband content including movie trailers and sports highlights. "We continue to believe our 3-megabit speed -- which is available to all our customers -- and our content partnerships will continue to give us a competitive advantage."

Peter J. Howe can be reached at howe@globe.com.