A Report on U.S. Broadband Adoption

Earlier this month, the Pew Internet & American Life Project released the report, Home Broadband Adoption 2007; the study is based on “a survey of 2,200 adult Americans conducted in February and March of 2007. While indicating an increase in across-the-board adoption rates, the report shows some sectors fairing better than others. Also, though rates are increasing overall, they are doing so at the slowest rate in years. Highlights of the findings include a five percent increase in the number of American adults with broadband access at home, but show rural broadband adoption not only lags adoption in more urban areas but also trails the national average.

As of March 2007, 47 percent of adult Americans reported having a broadband connection at home, in early 2006 that percent was 42, a twelve percent year-to-year growth rate. While this is an improvement it falls far short of the 40 percent growth rate from the previous period. In fact, the increase since last year is the smallest in the past five years; at 67 percent 2003 to 2004 was the highest and prior to this year 2004 to 2005 was the lowest with 20 percent.

Of all adult Americans 71 percent report going online at all from any location; of those who do go online, 94 percent have a connection at home. “Among adults with a home internet connection, 70 percent go online using a high-speed connection, versus 23 percent who use dialup.” The Pew research paints a pretty clear picture of who is using broadband. “Historically, high-speed internet adoption has been concentrated among the young, educated and relatively well-off. This trend held to form in our 2007 survey, as several historically broadband-heavy groups continue to have broadband usage adoption well above the overall average for adult Americans.”

The age group showing the highest percent of broadband at home was those between 18 and 29 (63 percent), this group was followed closely by those 30 to 49 (59 percent). The numbers drop off rapidly from there, only 40 percent of Americans between 50 and 64 use a broadband connection at home, and just 15 percent of those over 65 do so. As for educational background, of those with college or higher level education 70 percent use broadband at home; while 58 percent of those with only some college education do the same. Income is also a key factor, 76 percent of respondents reporting an income over $75,000 used broadband at home; the number dropped significantly to 58 percent for those reporting an income between $50,000 and $75,000. Interestingly, though the lowest in overall adoption, “Americans with annual household incomes under $30,000 are the only major demographic group for which broadband growth rates in 2006-07 (43 percent) met or exceeded those seen in 2005-06 (40 percent).”

The role of location, or “community type,” is hard to avoid when looking at broadband adoption numbers: 52 percent of Urban Internet users connect via broadband at home, 49 percent of those in suburbia, but only 31 percent who are in rural areas. However, despite being on the low end of the adoption rate, rural residents reflect the highest growth rate, 24 percent, among the three location breakdowns. “Between 2006 and 2007, high-speed internet usage among rural adults grew by 24 percent, versus 18 percent for urban residents and just 7 percent for suburbanites. In the same way that African-Americans “trail” whites in broadband adoption by roughly one year, broadband penetration among rural residents in early 2007 is now roughly equal to broadband penetration among urban/suburban residents in early 2005.”
Finally it is interesting to note the observation that Pew makes about broadband growth in general. “Despite relatively slow growth on a percentage basis compared with previous years, the number of home broadband users in early 2007 is now roughly as large (on a percentage basis) as the entire universe of internet users in the first year of the Pew Internet Project’s surveys of online use. In June 2000, 48 percent of respondents reported going online via any type of connection to check email or access the Internet, compared with the 47 percent who have a home broadband connection now.”

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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