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U.S. Continues To Lag In Broadband Penetration

New international rankings released; U.S. is 15th in the world

By Martin H. Bosworth
ConsumerAffairs.Com

May 21, 2008 

The United States' mixed record of nationwide broadband availability was one highlight of a sweeping examination of trends in broadband penetration and recommendations for the future.

"Data on penetration, price, speed and usage of the Internet highlight how member countries have promoted competition, encouraged investment and worked together with the private sector to increase connectivity," the report authors said, "[but p]rices for Internet access in some markets remain high and users may have a very limited choice of broadband providers. OECD policy makers can do more to promote efficient competition in some markets."

Among the report's highlights:

• Overall broadband adoption among all OECD member nations rose to 235 million in December 2007, an increase from the previous total of 200 million.

• Average speeds for broadband connections (including cable, DSL, and satellite) in OECD nations increased from 2 megabits in 2004 to almost 9 megabits, while prices continued to fall. The average price for a DSL connection fell by 19 percent, while cable subscriptions fell by 16 percent.

• Denmark, the Netherlands, Iceland, Norway, Switzerland, Finland, Korea and Sweden had the highest rates of national broadband penetration, with each surpassing the 30 subscribers per 100 inhabitants minimum.

• Governments of the OECD countries were lauded for implementing policies that promoted broadband usage for educational services, e-government initiatives, long-distance medical care, and consumer content creation.

The OECD researchers noted that though much progress had been made, "OECD policy makers can do more to promote efficient competition in some markets. Governments that have chosen to focus on infrastructure-based competition must create a competitive market environment that provides investment incentives for competitive operators and incumbents."

The report also discussed the variances in broadband availability between rural and urban enclaves among the member countries, with rural communities often facing limited access to carriers, lack of choices, and higher prices. In areas such as serving rural communities and promoting equal access, the report said, "[t]he private sector should take the lead in developing well-functioning broadband markets, but there are clearly some circumstances in which government intervention is justified."

Broadband bellwether

The U.S. lack of national broadband access has been an integral part of the debate over "net neutrality," the principle that all content on the Internet should be accessed equally. Supporters of net neutrality believe that securing the principle in law will be a stepping-stone to larger national broadband policies governing adoption and usage.

S. Derek Turner, research director for media watchdog group Free Press, said that "the reality is that because we lack meaningful broadband competition in this country, consumers pay too much for connections that are too slow. And many Americans -- especially in rural communities -- still don't even have high-speed Internet access. We need solutions -- not excuses."

The Federal Communications Commission (FCC), the government agency most closely identified with broadband-related issues, has been roundly criticized for its flawed data gathering on broadband availability in the U.S., particularly for counting speeds as slow as 200 kilobits per second as "broadband." The FCC recently announced plans to reform its process and gather more localized data on broadband subscribers around the country.

The Senate also has legislation pending that would further refine the FCC's broadband data-gathering process, in order to more accurately pinpoint which areas of the country are underserved by broadband providers.

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