Study Finds 43 Million American Households Now Have Broadband Internet Access
Forty-three million U.S. households now have broadband Internet access compared to just two million in 1999, according to the results of a new Consumer Electronics Association (CEA) research study on broadband access in America.
“Broadband households are quickly becoming the norm. It is very possible that dial-up Internet connections will be a thing of the past by the end of the decade,” said CEA President and CEO Gary Shapiro said. “High-speed Internet services have ushered in many new applications, devices and services that consumers are demanding. CEA research shows a bright future for custom retailers and installation professionals, because not all consumers are technically savvy enough, or want to spend the time to set up all the devices and applications they wish to use.”
According to the CEA study, Broadband and the Home of Tomorrow, 33% of non-owning high-definition television (HDTV) households are interested in having a professional install an HDTV in the next two years. This translates into 20.5 million households. Large numbers of households are also interested in having digital video recorders (DVR) and distributed audio systems installed.
While broadband adoption is quickly on the rise, the U.S. ranks 15th in the world in high-speed Internet penetration. Asian countries top the list, with South Korea, Hong Kong, Singapore and Taiwan all having higher than 50% penetration, and Japan coming close to the half-way mark with 49%. Many Northern and Western European countries also outpace the U.S. in broadband adoption, including the Netherlands, France, Denmark and Sweden. In addition, Canada has broadband penetration that is higher the U.S.
The CEA study found that dial-up Internet access is on a notable decline in the U.S. In 2000, dial-up Internet connections accounted for 74% of all U.S. residential Internet connections. This figure dropped to 60% by 2003, and currently stands at 36%. Additionally, the new research shows that cable Internet access has lost ground when it comes to customer value and popularity. In October 2000, cable broadband accounted for 15% of all Internet connections, compared to 4% for digital subscriber line (DSL). By March 2006, cable and DSL were head to head, each with 29% of the residential Internet market.
“Consumers desire even more choice when it comes to broadband. Currently, only 15% of online U.S adults are very satisfied with their current number of ISP choices. It boils down to choice and the value equation. Yes, speed and reliability are important, but the cost must be factored in, and when it comes to cable, consumers increasingly are missing the value,” said Shapiro.
According to the study, service satisfaction is highest among DSL subscribers, followed by cable Internet subscribers and is lowest among dial-up users. But price satisfaction shows an inverse relationship, while dial-up customers are the most pleased with the cost of their service (53%), they are the least pleased with the speed (26%). On the other hand, cable Internet subscribers are the least happy with cost (26%) and are the most happy with speed (76%). Falling in between are DSL customers, 46% of whom are happy with the cost and 69% of whom are happy with speed.
Because of this, only 46% of consumers are likely to recommend cable Internet to friends or family where as 61% of DSL subscribers would spread the word. While consumers like cable’s speed, the value for consumers is just not there.
Broadband and the Home of Tomorrow was conducted in March 2006. It was designed and formulated by CEA Market Research, a source of sales data, forecasts, consumer research and historical trends for the consumer electronics industry.