Technology | Media | Telecommunications

Tuesday, February 22, 2011

Broadband Bliss in America: the Innovation Challenge

Broadband access service is a necessity for many people in America. In fact, within the growing majority of U.S. households, it is considered the one telecommunication service that they value the most. However, compared to other nations that lead in the adoption of broadband services, most Americans still use rudimentary applications by comparison.

In many of those U.S. households, the user's most important concern is the download speed or available bandwidth of their broadband connection. But the few Americans that are savvy and informed are no longer satisfied with broadband downstream speeds and narrowband upstream speeds -- they want symmetrical service, real broadband in both directions.

U.S. Internet service providers were successful in 2010 in increasing the amount of available bandwidth to their subscriber base. Results from an annual survey of U.S. broadband households show that downstream speeds increased an average of 34 percent in 2010, according to the latest market study by In-Stat.

Ignorance is Bliss, When You're Not Worldly

In-Stat didn't mention progress with upstream speeds, probably due to the poor results -- when compared with the global broadband market leaders, such as South Korea, Japan and Singapore.

"The survey also highlights that the majority of U.S. broadband subscribers are generally satisfied with the current speed of their broadband service," says Mike Paxton, Principal Analyst. "This response indicates that so far, broadband service providers are managing to stay ahead of the consumer demand curve for bandwidth."

I believe that the key finding of the In-Stat study points to the economic innovation challenge that America faces today -- most people still apparently are 'consumers' of content, they produce very little that would require a globally competitive upstream broadband connection to the Internet.

In-Stat's market study also reveals the following:

- The average download speed for the broadband subscribers in the survey was 9.54 Mbps, up from 7.12 Mbps just twelve months earlier.

- In comparison to the rapidly rising amounts of bandwidth available to broadband subscribers, between YE2009 and YE2010, the average price for broadband service increased by 4 percent.

- 38 percent of the survey respondents also had a mobile wireless broadband connection.

- The average downstream speed across all access technologies increased by 71 percent over the course of the past two years. Cable modem and FTTH downstream speeds showed the greatest increases.

- The appearance of newly competitive access technologies, such as mobile wireless broadband, acts as a driver for increasing overall broadband speeds.