AT&T Cuts DSL Prices to $12.99

AT&T has lowered the cost of its entry-level DSL service to $12.99 USD per month, the lowest price for high-speed Internet offered by any carrier. Speeds of up to 1.5 megabits per second would be standard, but for an additional $5 per month users can upgrade to a speed of 3 Mbps.

There are some catches, however, as customers must sign up for the service online, and the pricing only lasts one year. After the year is up, the monthly pricing jumps to $29.99 and $34.99 USD, respectively. Additionally, new subscribers must also be local phone service customers of AT&T.

The move follows a previous price cut last June by the company while it was still known as SBC Communications to $14.99 USD per month, which was a 25 percent drop from its earlier rate.

Then SBC CEO Ed Whitacre said at the time that the price drop was aimed at attracting as large of a piece of the broadband market as possible before cable companies begin offering similar services that could draw customers away.

The continued price cuts also put pressure on cable operators to follow suit. So far, they have resisted doing so, pointing to the fact that the speed of their connections is far higher than competing DSL services. Consumers are seeing it a different way, opting in increasing numbers to choose cost over speed when selecting a broadband provider.

However, with Verizon FiOS on the horizon in many communities, cable's speed advantage will soon be erased. FiOS promises speeds of up to four times as fast as cable at the same monthly rates currently offered.