America’s movement toward greater broadband capabilities is a hot issue currently. The American Recovery and Reinvestment Act (ARRA) included a $7.2 billion allocation for the Broadband Technology Opportunities Program (BTOP) with a goal of bringing broadband to “unserved” and “underserved” communities and “improving access to broadband by public safety” (watch for our upcoming blogs about the public safety part). Commonly cited as the reason we need major investments in broadband is the United States’ ranking of 15th in the world with regards to broadband penetration–a fact that disturbs many in the country.
However, a recent report by the Technology Policy Institutes takes issue with this analysis to a degree. It says penetration numbers should not be derived on a per-capita basis, but instead on a per-household basis. Doing this provides a more accurate comparison across countries, and raises our ranking to somewhere around 8th in the world. For comparison, consider telephone penetration. Currently 95% of homes have telephones, but applying the same per-capita measures and comparing across countries, the U.S. ranks 45th in the world. Per household is clearly the more accurate measure.
And, penetration rates are growing so rapidly, it is likely they will reach saturation points in the next few years. So does this mean all of the excitement (and money) surrounding BTOP is for naught?
Not necessarily. It does help guide where money should be spent, however. While certainly infrastructure investments are needed in communities where this is lacking, generally speed, applications and other collaborative initiatives that foster greater internet adoption should receive the greatest amount of attention.
For example, this same study showed the U.S. lagging behind most wealthy nations–not in penetration–but in speed. At a roughly estimated average of just over 4 kbps, the U.S. ranks between 12th and 15th in speed depending on the source used.
Development of IP-based applications (which inherently drive greater broadband adoption) is also a needed area of focus. Software as a Service (SaaS) (delivering software applications on-demand over the internet) is still in its infancy, yet has tremendous potential for growth and adoption. So are possibilities for connecting public agencies with private commercial entities within community “anchor institutions” such as libraries, schools, etc.. This also increases adoption–possibly from population segments who do not currently value it.
Overall, the U.S. may be in somewhat better position than some claim, but we clearly do not lead the world in broadband. Policymakers should take into account the real barriers and gaps in the market, creating incentives for right approaches, while not erecting barriers for factors that are working well.