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Study: Capped 1-Gig Subs Yield 73% Higher ARPU

U.S. broadband consumers are using more data than ever, while service providers have a proven economic incentive to cap their usage.

That’s the takeaway from a year-end report just published by OpenVault, a broadband analytics company serving the cable industry. The firm found that operators deploying “usage-based billing” yield 73% higher average revenue per customer (ARPU) compared with those using flat-rate billing. 

With most usage caps set at around 1 terabyte to 1.2 TB, that’s increasingly an issue for U.S. consumers.

OpenVault also found that 14.1% of U.S. high-speed internet subscribers, per weighted average, used more than 1 TB of data per month in 2020, a 94% increase over 2019.

Overall, internet consumption was up big in the 2020 pandemic year. Both flat-rate and usage-based subscribers consumed a weighted average of 482.6 GB a month in the fourth quarter, OpenVault said, up 40% over 2019.

Notably, usage peaked in the fourth quarter, rising to a 2020-high average of 483 GB, OpenVault said (see chart). The story was the same for upstream usage, which also peaked in December at 31 GB.

OpenVault bandwidth chart

(Image credit: OpenVault)

For the first time, OpenVault reported, more than half (53.6%) of U.S. broadband customers now routinely use more than 250 GB of data each month. Just a few years ago, OpenVault noted, the 250 GB level was considered power usage. 

Also for the first time, more than half (50.6%) of users subscribe to a speed tier rated at 100 megabits per second to 200 Mbps. The average downstream speed is 207.11 GB.

Notable as well is the significantly higher broadband usage in North America vs. Europe. Last year’s 482.6 GB of average total usage in North America compared to just 301.2 GB in Europe.