PolicyBlog

A common debate technique is to focus on one fact (or purported) fact and then act as if that point defines an entire issue.  This is an especially good approach when an issue is complex or – more often – when if fact the true picture, when looked at in its entirety, actually suggests just the opposite of what you are claiming.  Sascha Meinrath and James Losey use exactly this approach when criticizing our CEO, Ivan Seidenberg, in his recent comments about the broadband market in the U.S.

My view is that the one statistic that is principally used over and over again to suggest the U. S. is “really behind” when it comes to broadband as compared to other nations – the OECD report that says the U. S. ranks 15^th globally when measured on the number of broadband connections per 100 population – is not only not terribly relevant but more so tells us almost nothing about the real performance of the U.S. when it comes to the many dimensions of broadband technology and use. 

After all, as George Ford of the Phoenix Center has demonstrated, if you take the logic of the OECD report and assume we’ve achieved “broadband nirvana,” wherein every home and business throughout  the OECD member countries has a broadband connection, then the U.S.’s OECD rank would drop from 15^th to 20^th!  In fact, to further hammer home how pointless it is to use the OECD rankings as a yardstick for success, consider that the U.S.’s OECD ranking for telephone service in 1996 was 16^th – at a time when all say the country had achieved universal phone service.

To me, the way to look at the U. S. when it comes to broadband is the way we view the Olympics.  This winter, the U. S. was clearly number one in the world in its overall performance at the Olympics even though it clearly did not win every event or even in some cases place near the top.  On the whole – looking at everything from investment and deployment of advanced and next generation networks to speeds and prices to competition and innovation in the wireless market – the U. S. is clearly the top performer.

So, let me offer some “shock and awe” – a host of important statistics from a wide range of sources – that makes this picture clear.

The Take-Up of Broadband in the U.S. Makes It a Leader in Comparison to Most Major Global Markets.

·   The U.S. has 81 million wireline broadband connections, compared to China’s 94 million and Japan’s 30 million.

·   Over 67% of American households have taken-up broadband – far higher than the average for Europe.

·   Global leaders in household take-up, such as the Netherlands, South Korea and Iceland, are impressive – but are also far smaller geographic markets, with far more concentrated populations, than the U.S.

·   The U. S. has added 39 million broadband household connections in just the last five years.

The U.S. is a global leader in broadband access.

·        95% of Americans have access to wireline broadband capable of download speeds of at least 4 Mbps, according to the FCC’s National Broadband Plan (NBP).

·        82% have a choice of at least two wireline broadband technologies, also according to the NBP.

·        Only 42% of U.S. broadband subscribers rely on DSL for their broadband.  The vast majority of foreign markets don’t have nearly the depth of options (including cable, fiber, mobile and satellite) that we do.

·        The U.S., Canada and Mexico have connected 27% more users with fiber than all of the countries in Western, Central and Eastern Europe combined.

·        Verizon alone has deployed more next generation fiber-to-the-premises lines than all of the providers in the EU.

Wireless Take-Up and Service Deployment in the U.S. Far Exceeds Europe and Asia In General. 

·   The U.S. market accounts for 6% of global wireless subscribers, but a full 21% of all 3G subscribers.

·   U.S. mobile customers pay 60% less per minute than the average among the top 25 OECD markets.

·   Average minutes of use of mobile devices in the U.S. are the highest globally – 842 per month, whereas the average across Western Europe is 180 per month (a high of 314 in Asia – South Korea).

·   The take-up of mobile Internet by users is roughly 15.6% of all U.S. subscribers, whereas it’s 13% in the U.K., 12% in Italy, 9.6% in France, and 7.4% in Germany (the largest European markets).

·   With Sprint operating Wimax in 27 U.S. cities, and Verizon with LTE in 25-30 cities by the end of 2010, few national 4G deployments can compare.

·   The U. S. is the most competitive market in the world when it comes to mobile services.

U.S. broadband speeds and prices are not only competitive globally, but also beat some markets considered global ‘leaders’.

·   The average download speed in the U.S. is 4.2 mbps, compared to 3.2 mbps, the average for the EU.[i]

·   The ITU ranks the U.S. 4^th in average broadband price, behind Macao, Israel and Hong Kong.

·   U.S. consumers have seen a 40% reduction in broadband prices over the past five years.

·   According to the FCC, fully 50 million homes in the U. S. today can get access to speeds of up to 50 megs.

U.S. Broadband Is Fueling Innovation.

·   The 2010 ‘Connectivity Scorecard’ ranks the U.S. among the world’s top 3 Innovation Driven Economies for the 3^rd year in a row.

·   The World Economic Forum’s ‘Global Information Technology Report’ ranks the U.S. in the top 5 for Networked Readiness.

·   Nearly all of the most advanced mobile handsets available in the U.S. through 2009 were first launched in the U.S. market.

·   The U.S. has over 630 mobile handsets of various kinds available, far exceeding the number of handsets available in any other country.

·   The U. S. has numerous apps stores now available, many based in the U. S.

·   Some experts who have looked at innovation suggest that a good metric to measure an elusive concept like innovation is the amount of investments companies are making.  When it comes to broadband, U. S. companies have invested $193 billion in broadband networks over the past five years.

Now take a breath because while all of that is very impressive, I want to clarify one more intentionally confusing point in the commentary from Meinrath and Losey . . .   

They say the number one reason people give for not having broadband is affordability.  In fact, two-thirds of those who offer reasons for not having broadband cite something other than cost including such things as lack of familiarity and lack of compelling need or applications.  And more important, 58% of those who do not have a home broadband connection, do not own a computer.  Clearly factors other than cost are significant factors in the lack of broadband adoption. But the fact that the industry has signed up 39 million households to broadband over the last five years says that something is right in the industry.