September 30, 2003 6:35 PM PDT

SBC Yahoo DSL cuts prices again

Broadband prices are hitting the basement.

SBC Communications and Yahoo, which are partners on a co-branded digital subscriber line service known as SBC Yahoo DSL, have introduced a plan that sells one year of service for $26.95 per month.

The offer is available only to new subscribers who sign up via the Internet. The companies will also continue to pitch a $29.95-per-month promotion advertised on TV and in print.

Subscribers to either promotion receive the same package of features, including Yahoo's Web services and other software such as parental controls and antivirus software, a Yahoo representative said.

For the past few months, Baby Bell phone companies have been discounting their DSL services with limited-time promotions. Besides SBC, Verizon Communications and BellSouth have cut prices in hopes of luring new customers to their high-speed Internet access.

However generous, DSL providers are cutting rates in hopes of fending off heightened competition from cable companies. Cable giants such as Comcast, Time Warner Cable, Cablevision and Cox Communications have offered packages with video, broadband and phone calls all on one bill.

The Bells fear further inroads by cable companies into their core local and long-distance phone services. However, the Bells have not been able to match cable's feature bundles and have tried to spark more broadband additions as a defensive move to hold onto their customers.

This summer, the Bells struck alliances with satellite television services such as Hughes Electronics' DirecTV and EchoStar's Dish Network in order to bundle a video offer for their phone and DSL customers.

A Yahoo representative would not comment on how many people subscribe to SBC Yahoo DSL. In July, SBC said it added 304,000 new DSL customers, which are also counted as paid users on Yahoo.

The promotion details were first reported by Broadbandreports.com.

 

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