There is a lot of criticism on many fronts with regard to the broadband industry. In fact, when I attended a recent Free Press event, I heard many comments about the failure of the market place and the lack of competition.
A new survey released today by the Pew Center, however, suggests that the industry is doing very well on a number of levels. Not all is perfect, but on the whole, the glass is very much more full than empty.
The new report is based on a survey conducted of Americans regarding their access to the Internet and was completed in April of this year. While there are some issues in the report that give pause – for example the growth in broadband connectivity in African American homes has been minimal over the last year – on the whole, in most segments of society, the broadband industry is performing well in terms of promoting broadband and connecting more Americans.
Overall, the report came to the following conclusion:
Home broadband adoption stood at 63% of adult Americans as of April 2009, up from 55% in May, 2008. The latest findings of the Pew Research Center’s Internet & American Life Project mark a departure from the stagnation in home high-speed adoption rates that had prevailed from December, 2007 through December, 2008. During that period, Project surveys found that home broadband penetration remained in a narrow range between 54% and 57%.
If you use 112 million occupied homes/apartments in America as the base (2008 Census statistics), the total number of broadband connections comes to 70 million, an astounding number and a large increase in penetration rates given the economy.
Beyond the overall statistics though is the fact that many segments of society that have traditionally lagged in broadband uptake are now connecting at a rapid pace. Take the following points from the Pew survey:
Senior citizens: Broadband usage among adults ages 65 or older grew from 19% in May, 2008 to 30% in April, 2009.
Low-income Americans: Two groups of low-income Americans saw strong broadband growth from 2008 to 2009.
Respondents living in households whose annual household income is $20,000 or less, saw broadband adoption grow from 25% in 2008 to 35% in 2009.
Respondents living in households whose annual incomes are between $20,000 and $30,000 annually experienced a growth in broadband penetration from 42% to 53%.
Overall, respondents reporting that they live in homes with annual household incomes below $30,000 experienced a 34% growth in home broadband adoption from 2008 to 2009.
High-school graduates: Among adults whose highest level of educational attainment is a high school degree, broadband adoption grew from 40% in 2008 to 52% in 2009.
Older baby boomers: Among adults ages 50-64, broadband usage increased from 50% in 2008 to 61% in 2009.
Rural Americans: Adults living in rural America had home high-speed usage grow from 38% in 2008 to 46% in 2009.
Again, all amazing increases in penetration among groups that traditionally have not been among the more active users of broadband.
Seventy percent of those surveyed said they had more than one choice in broadband providers and more than 60 percent of those households said they had three or more choices. These choices only include “Fixed Wireless”, DSL, Fiber, cable modem and not mobile wireless, although it is not entirely clear that all of those interviewed understood all of those distinctions. Still, the number of choices in the market once again belies the stereotypes.
There are some areas in the survey that are not quite as positive as these broad, overall trends. For example, the number of African American households connecting to broadband barely increased in this survey. Even in this case, however, a more in depth look suggests that other trends may make this picture look brighter. Pew has found, for example, that African Americans tend to be more active users of data and online services via mobile phones than other groups in society and it may well be that for some market segments, mobile connectivity to data services is a more common way to connect to the Internet.
Further, the Pew survey found that monthly prices for broadband access went up over the last year. However, if you look back over several years, average prices have remained flat, DSL prices are far lower than the average (and far lower than cable broadband prices) and it appears a contributor to the higher average reported prices may in fact be that people are moving up to higher speed connections which tend to cost more. Again, on the whole the pricing statistics tell a generally positive story.
In sum, the latest Pew survey suggests that the broadband market place, contrary to the criticisms commonly made against it, is competitive, providing more options to Americans and making good progress in getting more people connected to the Internet. We know there is work to be done regarding some issues – such as deployment in more rural areas and access for some segments of society that remain offline – and we have focused on these issues. But the market is performing well on a number of key metrics as this Pew survey suggests.