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Submitted by ravin_kum on January 9, 2007
Category: Miscellaneous
Words: 2277 | Pages: 10
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Price and Income elasticty - Analysis of AT&T DSL services.
Introduction
Broadband high-speed, always-on Internet connectivity represents the next phase in the evolution of the Internet. Most experts predict broadband will enable applications and services that transform our economy, education, health-care, R&D, homeland security, military effectiveness, entertainment, government and the quality of life for citizens around the world. The deployment and usage of broadband will significantly impact the global competitiveness of nations and businesses in the future. This paper discusses how price elasticity and income elasticity impact the broadband Digital Subscriber Line (DSL) demand.
Broadband Internet and AT&T
Our learning team selected the Internet service provider industry and focused on DSL broadband service for price-elasticity analysis. This research is focused on AT&T Inc. (formerly SBC Communications). AT& T was established in 2005 when former Baby Bell SBC bought AT&T Corp. for some $16 billion creating the largest telecom outfit in the US. After the merger, SBC adopted the globally familiar AT&T moniker. Now, AT&T has agreed to acquire southern Baby Bell BellSouth in a deal valued at $67 billion. The new AT&T now has more than 49 million access lines in service. Cingular Wireless, the company's wireless joint venture with BellSouth, is the leading US wireless carrier with more than 54 million subscribers. The company is headquartered in San Antonio, Texas and employs approximately 189,000 people. For fiscal year 2005, the company reported revenues of $46.3 billion, an increase of 7.5% on fiscal 2004. Net income for the year decreased 18.7%, dropping to a 2005 total of $5.1 billion." (Datamonitor, 2006)
The internet-access market is growing at a rapid pace in the flat world and global economy. "The United States internet access market grew by 12% in 2005 to reach a value...
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