Broadband: US Continues To Lag The World

Information Week has an update on the state of broadband connectivity in the US, relative to the rest of the world. Some highlights:

  • Broadband growth rates are much higher in other countries
  • OECD: the US is 12th in broadband adoption rates
  • ITU: the US is 21st in broadband penetration rates
  • We pay more for less

Thankfully, the reporter included criticism of the rosy FCC report from July 2005. That report defined “broadband” as 200 Kbps in at least one direction and considered a zip code to have 100% penetration if it had only one active broadband line. This is inflating the data.

But why is 200 Kbps a bad measure of “broadband”? From InfoWeek:

Japan’s fastest-growing broadband service offers speeds in excess of
100 Mbps, and Korea offers 100 Mbps uploads and downloads. Most current
U.S. customers are lucky to get one-tenth or even one one-hundredth of
that speed, particularly for uploads — and they pay more for the lower
speed.

By OECD estimates, the U.S. price-per-megabit of connection speed is
more than 10 times as high in the U.S. as in Japan. And for sheer
speed, overseas offerings blow the U.S. away. While major U.S.
carriers, such as Verizon, report initiatives to bring high-speed fiber
to the home, and a Verizon spokesperson reported current plans to reach
3 million homes per year with high-speed fiber, that’s roughly 1% of
the U.S. population, even if that target is met. Only 1% to 2% of U.S.
broadband users in Pew’s latest study report having fiber or T1-speed
access, while some other nations are more aggressively pursuing
deployment of fiber to the home and other forms of very high-speed
connectivity.

The reporter effectively rebuts the “but we’re too rural” argument often cited as the reason for low broadband penetration: “[F]ive of the 11 nations that lead the U.S. in per capita broadband
penetration, including Iceland, Finland, Norway, Sweden, and Canada,
have significantly lower population densities than the U.S.”

It looks like demographics aren’t the key, either: we have “a statistically younger population based on median age than
all the countries — except Iceland and Korea — that are ranked higher
for broadband adoption.” We’re also “more affluent” than most of the countries we trail, whether the measure is Gross Domestic Product or Gross National Income Per Capita.

Public policy makers have left the infrastructure decisions to “the market” — and the result is a market that isn’t competitive and a network that isn’t standardized.

Just like the early days of “electrification” and “telephony” — US corporations are focused on areas of high population density / low cost-per-customer. Four firms — Comcast, AT&T, Verizon, and Time-Warner — control more than 55% of the US broadband market.

Add to that the incompatible networks of the cellphone carriers, and the US customer faces a mess, compared with customers in Germany or Japan, for example.

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