Mission accomplished ... perhaps.
It appears that cable industry leader Comcast (NASDAQ:CMCSA) may have arrived at a broadband management plan that could both satisfy the Federal Communications Commission and set a standard for other Internet companies trying to deal with heavy bandwidth users. The plan follows months of wrangling with the FCC over how to deal with certain high-speed data customers that tend to use greater-than-usual amounts of bandwidth for peer-to-peer applications, for instance.
Under the Comcast approach, which was submitted to the FCC at week's end, the company will slow its Internet speeds for its heaviest users during congested peak periods. To accomplish this separation, it'll establish a second traffic stream for those users. That stream will have a lower priority than the primary stream used by its other customers.
The submission to the FCC comes after an Aug. 20 requirement by the commission that the company submit a plan for dealing with its broadband hogs. The company had conducted a three-month test of the approach in five cities. The test appears to have been run without customer complaint. It involved less than 1% of Comcast's high-speed data customers on a typical day.
My reaction to this approach is that it's fair and equitable for both the company's typical data customers and those requiring increased bandwidth. Further, it appears to be an approach that could be implemented by other providers, including AT&T (NYSE:T), Time Warner Cable (NYSE:TWC), Cablevision (NYSE:CVC), and Verizon (NYSE:VZ).
Comcast serves about 14.4 million high-speed-data customers, along with 24.6 million cable subscribers and another 5.6 million telephone users. The cable number, for instance, compares to less than 8 million subs when I began watching the company and its peers.
In the period of my observation, I've noted Comcast's obviously unrelenting growth, perhaps even steadier management, and an ability to compete effectively on a host of fronts. With its shares having fluctuated between just above $16 to slightly more than $24.50 year to date, along with a Friday close at $20.71, I'd recommend that Fools keep close tabs on this mother of all cable stocks.
Comcast is a three-star performer among Motley Fool CAPS players. I'm going to give it an outperform vote in the hopes that I can single-handedly muscle up and raise it by a star.
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