Sonic.net bucking the data cap trend

Early last month, this column highlighted the disappointing pattern of companies eliminating all-you-can-eat Internet data plans. That included the two main options for residential broadband in the Bay Area: AT&T and Comcast.

At least one local company, however, is swimming against the telecom tide.

Sonic.net, a 17-year-old Santa Rosa firm, continues to offer broadband plans without data caps and recently dropped its speed limits, meaning all connections now run as fast as the pipes allow for the same price. Perhaps more interestingly, the company is gearing up to vastly accelerate those speeds in certain areas, to levels far higher than what's generally available in the region today.

Sonic has begun a "fiber to the home" pilot project in Sebastopol, replacing the aging copper wires that reach most homes with fiber cables offering speeds of up to 1 gigabit per second. Translation: You could download most standard-definition movies in about 30 seconds.

The offerings beg the obvious question: If a small regional Internet service provider thinks it can profitably deliver such services, what's stopping its huge, high-margin rivals?

The first homes will be switched on this month, and the final ones should be up and running early next year.

The company, which Google selected to operate an experimental fiber-to-the-home network at Stanford, plans to install the blazing service in other cities once the market share there justifies the up-front investment. The sweet spot is somewhere between 20 and 40 percent, depending on the particular costs and regulatory headaches posed by any given municipality, said Dane Jasper, chief executive of Sonic.

Cities in the running to get fiber to the home next are Forestville, Santa Rosa and Healdsburg. San Francisco is 12th on the list but moving up fast. Oakland is 16th, and San Jose comes in at 17.

$39.95 basic package

Sonic now offers a standard broadband service throughout much of the Bay Area featuring download speeds of up to 20 megabits per second, along with a flat rate phone line, for $39.95 per month. Its high-level service includes two lines and speeds of up to 40 Mbps for $69.95.

As the company swaps out copper for fiber, it plans to maintain those prices, even as the speeds rev up to 100 Mbps for the basic service and 1,000 Mbps (1 gigabit) for the top end.

Apples-to-apples comparisons with AT&T and Comcast get a little messy since each service offers different packages, add-ons, features and introductory rates. But at this point, Sonic's fiber network promises to be a faster Internet service, with no data limits at prices comparable to or cheaper than its competitors' full-throttle residential offerings.

Here are a few comparative figures (with apologies for the data dump):

-- Comcast's monthly charge for Xfinity Internet Blast, its cable Internet service with download speeds of up to 20 Mbps, ranges from $52.95 to $70.95 after introductory offers expire, according to its website. In some areas, it also offers a plan with download speeds of up to 105 Mbps, for the pricey standard rate of $129.95 per month.

-- After promotional pricing, AT&T charges $63 a month for the fastest version of U-verse Internet, its fiber service with download speeds of up to 24 Mbps.

Fiber stops short

U-Verse, which is available to about a million homes in the Bay Area, is mostly a "fiber-to-the-node" service, an ugly bit of industry gibberish meaning the fiber cable ends at a box a short distance from the homes. For our purposes, what that means it's slower.

AT&T is building out a fiber-to-the-home service like Sonic around areas of new residential construction - but, of course, there's not exactly a lot of that in the Bay Area right now.

To be fair, of course, describing Sonic's network as even nascent would be generous at this point. It will be a long time before fiber to the home is a real option for most Bay Area residents, and there's still plenty that can go wrong in the rollout.

AT&T spokesman John Britton emphasizes that there are a lot of reasons why customers will continue to choose the big players in the market, including a wider range of products and features.

"What people want is an integrated, easy experience," he said. "People like going with the market leader and the people innovating and creating the future."

But by eschewing data limits and revving up its service, Sonic is doing exactly what any business underdog should: providing a competitive choice in the marketplace that, hopefully, tugs the giants in a direction that benefits all consumers.

So why aren't AT&T and Comcast delivering similar services at comparable prices? In all likelihood, only because the little competition that exists hasn't compelled them to do so.

But in a market brimming with Internet power users, Sonic's increasingly differentiated products seem to be catching on.

The company's customer base has been expanding by more than 10 percent a month, forcing it to boost staff by more than 30 percent in the past six months.

"We have been overwhelmed with demand," CEO Jasper said.

If AT&T and Comcast don't bother to take notice, their customers should.