U.S. broadband access slips further

Aaron Ricadela
03 May 2007
00:00

What do Internet users in Denmark, Holland, Iceland, Canada, and France have in common‾ They're more likely to be sending e-mail and surfing the Web over a high-speed link than just about anyone else in the world"”including their counterparts in the U.S.

That's a key finding of an Apr. 23 study by an economic research group that ranks the U.S. No. 15 out of 30 countries in per-capita broadband subscriptions. And it's adding fuel to a debate about how far the U.S. should go to usher a wider swath of the population into the Digital Age. Those were among the topics slated for discussion at an Apr. 24 Senate committee hearing on broadband and American competitiveness.
Slump

The latest biannual broadband data from the Organization for Economic Cooperation & Development, a group of 30 industrialized countries that share economic statistics, don't paint a rosy picture of Internet access in the States. As of December, 2006, 19.6% of Americans subscribed to a broadband line"”defined as a connection that enables at least 256 kilobits of data per second to be transferred in one direction.

Broadband leader Denmark, by comparison, boasted a 31.9% subscription rate, with the Netherlands coming in second with 31.8%. In Britain, 21.6% of citizens subscribed to high-speed lines, making it No. 11.

And the U.S. is slipping. It fell from the 12th-most-saturated broadband country six months ago; in 2001 it was fourth. Meanwhile, No. 21 Australia (at 19.2%) is threatening to bump the U.S. down further.

Finger-pointing

The findings have some consumer advocates up in arms. S. Derek Turner is research director of Free Press, a media policy and lobbying group that pushes for regulatory changes that would result in more competition among phone and cable companies. He says the poor U.S. showing reflects a recent change in law that hurts Internet service providers and could be crimping the country's productivity. He points to a 2005 rule change that means ISPs can no longer lease only the data portion of phone companies' wires into homes, saying the policy has squelched innovation and companies' ability to deliver new broadband-dependent services. 'Ending local access was a bad decision,' Turner says.

The policy keeps broadband prices high by concentrating delivery in the hands of a few phone and cable companies. For U.S. consumers, 3 megabits per second (Mbps) digital-subscriber-line (DSL) services cost about $32 per month, and cable modem service, which delivers 4 Mbps to 6 Mbps, runs between $38 and $45, he says. By comparison, in France (with a 20.3% broadband adoption rate), one ISP has bundled unlimited phone calls, 93 cable channels, and a super-fast 20-Mbps Internet connection all for the equivalent of $33 per month.

Other analysts disagree. Michael Cai, director of broadband and gaming at market researcher Parks Associates, estimates that 53 million U.S. households"”about half"”had broadband Internet access at the end of 2006. That's expected to grow 12% a year, to 82 million households, by 2010. 'In the next few years, the problem for the U.S. is going to be less,' says Cai. 'The [computer] industry tends to be negative about the low ranking for the U.S., but I don't think we're seeing an adverse impact on other industries.'

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