Friday, September 07, 2007

Overcoming the Broadband Divide

A month after the Pew Internet & American Life Project released its Report on Home Broadband Adoption, it released a memo entitled, U.S. Lags Behind: Why It Will Be Hard to Close the Broadband Divide. Jim Horrigan, the report's author cuts through the politicking and points out that despite the efforts of those with much invested in the effort to sell broadband, time may be the best salesman.

"Non-internet users as a group are disproportionately old and poor. The median age of non-internet users is 59, and 25 percent report having household incomes under $20,000 per year." Furthermore, "Non-internet users do not have very positive attitudes about information technology." The poor and elderly, particularly those with concerns about IT will not be an easy group to woo.

Faced with the challenge of that group, it may be seen as a more surmountable obstacle to convert dial-up users to broadband. Dial-up is seen as a starting point for users who, as they are drawn in, eventually find the need for higher speed and make the switch. However, Horrigan says that that process takes time and he notes, "that 29 percent of dial-up users have high-speed access in the workplace, suggesting that, for some, workplace broadband may substitute for a home connection."

Finally, "The usability and relevance of the internet are additional speed bumps for dial-up users." Roughly one quarter of adult Americans frequently need help getting information and communication technology (ICT) to work, close to half state that such technologies have not improved their productivity, and "sizable numbers" report ICTs either give them less control over their lives, or make no difference. "The vast majority of these Americans are dial-up internet users, and their indifferent posture toward ICTs may make them reluctant to incur the costs of upgrading to broadband at home." Horrigan goes on to mention a few possible strategies that those with vested interests could adopt, none of which are likely to put much of a dent in broadband adoption. Only 4 percent of respondents to an earlier Pew poll said that price was a reason for switching to broadband; so lowering those won't help much. And "Improving infrastructure availability will help, especially in rural areas, but not by enough to alter the U.S. position in the world. Even, "Assuming most of the gap is concentrated in rural areas and that closing the gap would bring rural broadband penetration in line with the national average, America’s home broadband penetration would rise by only 3 percentage points. That will not vault the U.S. to the top of OECD’s rankings."

A more complete version of this post, including links to market research, can be found at the website of Analyst Views Weekly.

More information on this topic can be found in the Online Access section of Northern Light's Internet & Information Services Market Intelligence Center.

And in the following articles:

Towns Left Scrambling for Touch of Broadband
Boston Globe, July 18, 2007
On any given day in this rural town of about 1,000, a few people park their cars in front of Town Hall while they log onto the Internet. But they aren't typical WiFi poachers. They are dial-up refugees.

Global Broadband Adoption Grows
Vnunet.com, July 16, 2007
Broadband is becoming the dominant global medium for IT service delivery on both fixed and wireless networks, according to new research. The Organisation for Economic Co-operation and Development (OECD) report shows 60 per cent of member countries' web users are now on broadband.

Nearly Half of U.S. Homes Have Broadband, But Adoption Rate Slows
InformationWeek, July 5, 2007
The U.S. continues to fall further behind other countries in terms of broadband penetration, but broadband usage in the U.S. is increasing, according to a report released this week by the Pew Internet & American Life Project. Nearly 50% of Americans have broadband connections in their home, Pew said. But the overall rate of growth is slowing.

Broadband Internet Adoption Rate Slowing
Chicago Tribune, July 5, 2007
More Americans than ever have broadband Internet access at home, but the adoption rate is slowing, suggesting most of those who want broadband now have it. High-speed Internet access, of course, is key to taking full advantage of Web video and understanding all the fuss over the modern Internet.

Experts: Better Broadband Stats Needed
PC World, June 28, 2007
The U.S. government needs better ways to measure broadband availability and adoption in order to develop policies that focus on ways to use broadband to improve the economy, several telecom experts said Thursday. "As policy makers, we need to have an eye to the future," said Beth Shiroishi, senior director of regulatory policy and planning for AT&T Inc. "Where do we want our country to go, and where do we want our citizens to go?"

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