Facing Competition, AT&T Cuts Chicago Gigabit Prices

Dec. 5, 2016
Perhaps signaling the start of a local gigabit price war, AT&T (NYSE:T) has cut the price of its gigabit Internet service in Chicago to $70 a ...

Perhaps signaling the start of a local gigabit price war, AT&T (NYSE:T) has cut the price of its gigabit Internet service in Chicago to $70 a month. The telco launched its fiber-based service, now called AT&T Internet 1000, in parts of Chicago last June at a starting price of $120 a month.

Since then, Comcast (NASDAQ:CMCSA) and RCN have both launched DOCSIS 3.1-based gigabit services in the Chicago metro area. RCN's service - which launched in early November - is $70 a month, and Comcast's is $140. Comcast's service is still described as a trial, and the MSO is testing promotional pricing in the Chicago market and others, including Atlanta, Nashville and Detroit.

AT&T says all current AT&T Internet 1000 and AT&T Internet 100 customers in Chicago will automatically receive the new lower price within the next one or two billing cycles.

"This is an aggressive offer. Our enhanced price for the area comes at a time when other providers are doubling the price of their service or failing to meet their commitment to connect Chicago," said Cheryl Choy, vice president, data and voice products at AT&T. "We're offering the best integrated experience and ultra-fast Internet for customers with AT&T Fiber."

Gigabit price wars have previously gone on in other markets, such as the Kansas City metro area and particularly Austin, TX, both of which have several operators offering 1 Gbps speeds. Google Fiber (NASDAQ:GOOG) more or less set the price expectation for gigabit at around $70 a month. Generally, gigabit prices tend to be higher in markets where only one operator offers the service.