How Important Is Broadband In Your Home?

An article in ExtremeTech finds that, in the United States, broadband in the home is up from last year. Considering the recession, and layoffs, the 15% increase, to 63%, is quite interesting, if not amazing. The study also finds that the average cost of broadband has gone up over the last year from $34.50 to $39.00, which is amazing to me, as increased market penetration is supposed to decrease prices, not increase them. The recession should also contribute to the lowering of broadband prices, as providers make retention of existing customers a priority.

One reason I would assume that broadband is on the increase at home is the actual need, not simply want, of the service in the home. In my home, with children in school, it has become assumed by the schools that broadband is available, and not enough time is made available at school, or the public library, to conduct all the business needed to fulfill homework assignments. Many classes in the California school system make assignments that must be done using internet research, so what choice do parents in California have? It is almost as if a mandate has been given.

There is nothing wrong with this assumption for many, but I do wonder how many households are sacrificing something, in order to have this service, which for the older generations is clearly seen as a luxury. No wonder the President wants to make the service ubiquitous and inexpensive.

Broadband adoption is on the rise, but so are monthly bills, according to a Wednesday report from the Pew Internet and American Life Project.

About 63 percent of American adults now have broadband connections at home, up 15 percent from the same time last year. Unfortunately, an increased customer base has not prompted a drop in price from providers. The average monthly price for broadband in April 2009 was $39 – up from $34.50 in May 2008.

Despite the price increase and the recession, people are twice as likely to cut cell phone or cable TV service before they get rid of broadband, the study found. In the last 12 months, 9 percent of Internet users have dropped Internet service, but 22 percent have cut cable and another 22 percent have shut off the mobile phones.

For the first time, Pew also weighted the Internet’s effect on civic involvement. About 55 percent of respondents said they had used the Web to engage with the community, contact government officials, or contribute to economic growth.

What services are people using? About 34 percent of users subscribe to premium service, up 29 percent from last year. Monthly prices for premium are up from $38.10 to $44.60. About 53 percent still have basic Internet service, a number that stayed relatively flat from last year. Prices for basic are up from $32.80 to $37.10.

Not surprisingly, the more providers in the area, the lower the prices. About 21 percent of people only have one provider in their area and they pay an average of $44.70 per month. The majority, or 69 percent, said they have more than one provider from which to choose, and they pay $38.30. The 17 percent of people with four or more broadband options pay $32.10 per month.

Pew noted growth in broadband adoption in several key demographic groups. Adoption among senior citizens, for example, spiked 58 percent to 30 percent of all those 65 and older, while 46 percent of rural Americans now report having broadband, up 22 percent from last year.

Among low-income Americans, people who make $20,000 or less saw a 40 percent increase in broadband adoption, while those making between $20,000 and $30,000 saw 26 percent growth. Overall, those making less than $30,000 annually reported 34 percent growth in home broadband adoption.

African American households, however, did not fare as well. Though adoption increased from 43 percent to 46 percent, that marks the second year that African Americans reported growth that was below average, the study said.

The next good news is that there are only about 7% of the people who have dial-up connections. About a third are sticking with slow because of monetary concerns, but a full 17% have no access to broadband. (Strangely, no mention of the numbers stranded by the problem of last mile, versus the people who are truly out in the outback!)

Some of the problems are to be ameliorated by WiMAX, yet we see deployments in large cities, such as the recent deployment in Atlanta, rather than in rural areas. WiMAX will be another technology that will function as a tool of the wealthy, not a tool to promote equality.

The final point of the study was that the largest sector of the population in need of  the services were the poor, and helping extend  the services to them would also yield the very largest gains. (where have I heard that before?)

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Quote of the day:

It’s hard to be nostalgic when you can’t remember anything. – Unknown

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