Industry-Funded Group Says U.S. Broadband Just Fine

Study after study has shown that the U.S. lags behind other countries when it come to broadband. Not only are fast connections more expensive in the U.S. than abroad, but many people only have a choice of two broadband providers: their cable company or telecom. Some people don't even have that; an estimated 19 million Americans live in areas that lack all access to broadband, the Federal Communications Commission reported last year.

The sorry state of high-speed Web access in the U.S. has led the FCC to conclude for three years in a row that broadband isn't being deployed in a "reasonable and timely" fashion.

What does this mean in dollars and cents? Consider this stat from the New America Foundation: In Seoul, residents can obtain triple-play Internet-TV-phone service with broadband speeds of 50 Mbps in both directions for less than $33 a month; in New York City, Time Warner subscribers pay around $112 a month for triple-play service with download speeds of 15 Mbps.



But one group now says that U.S. broadband isn't as bad as it might seem. The industry-funded think tank Information Technology and Innovation Foundation argues in a report issued this week that the U.S. "has made rapid progress in broadband deployment, performance, and price, as well as adoption." The ITIF says that the price of broadband is "reasonable" considering that the country is "largely suburban."

The report goes on to assert that there is "robust" competition between cable and DSL fiber-based facilities, that entry-level pricing is low and that pricing is progressive, in that people pay more for higher speeds.

The ITIF also questions whether there's really a demand for fast connections. "While gigabit test bed projects ... are important, the idea that most U.S. broadband users currently need networks this fast is simply wrong. Virtually all existing broadband applications run quite well on the average broadband network in most U.S. cities," the report states. "This does not mean that higher speeds may not or will not be needed as new applications emerge, but the notion that nations should massively overbuild most of its networks far ahead of real consumer demand is not wise economics or broadband policy."

Of course, that conclusion seems to discount the enormous enthusiasm that high-speed services are able to generate. Consider, last month, Broadband Reports called attention to a report from Ideas & Solutions! Inc. showing that 60% of people who could receive Google Fiber -- which offers Kansas City residents 1 GB broadband -- say they would like to do so. That study, based on a survey of 1,303 people, also found tremendous enthusiasm for the service, with 88% of respondents saying that Google Fiber is better for IP-based TV apps, and 90% of respondents saying that Google is the better option for cloud-based services.



3 comments about "Industry-Funded Group Says U.S. Broadband Just Fine".
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  1. Jerry Shereshewsky from GrownUpMarketing, February 14, 2013 at 9:20 a.m.

    Not surprising that an industry group would be dragging its feet. And it's not just broadband. Making cell phone calls is more reliable on the Great Wall of China than in midtown Manhattan. Perhaps we just love mediocrity.

  2. Peter Burgess from Tr-Ac-Net TrueValueMetrics, February 14, 2013 at 9:45 a.m.

    Good article about a huge problem. 50 years ago almost everything that was the world's best was in the USA and made in the USA. Now about the only thing that the US business community does really well is converting technology to productivity to profit for executives and investors while rather little of amazing technological progress goes into wages for (US) workers, community and society. Technology is maybe a million times more capable than 50 years ago, but society (wages, quality of life, etc.) for most remains stagnant while rewards for capital have been impressive. It is long overdue for business leaders to engage in the upgrade of society as a whole ... universal high performance broadband is one issue of many that business leaders should address.

  3. Susan Breidenbach from Broadbrook Associates, February 15, 2013 at 3:20 p.m.

    Comparisons of any kind of transmission infrastructure -- communications, power, water, etc. -- need to take population density into account. Economies of scale for infrastructure buildout are affected very fundamentally by population density. The U.S. has one of the lowest population densities in the world, while South Korea has one of the highest. Comparisons also need to take into account any government subsidies, since the end consumers of the services ultimately pay all of those, albeit indirectly.

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