Is Home Broadband Adoption Slowing?

There are indications that the growth rate in home high-speed adoption is slowing. Two factors jump to mind as reasons for this slowdown. First, high growth rates become more difficult to sustain as society marches up the adoption curve; it becomes a tougher sell to reach non-adopters once the 50% threshold is passed. Remaining non-adopters - the 9% of dial-up users and 25% of non-Internet users - are older and lower-income Americans. They are not likely candidates for upgrades in household communications technology. Second is the economy. With unemployment now up to 6.1% (from 5.0% in December 2007) and growing economy uncertainty, adding to household expenditures with a broadband connection may not be a priority for some people. On a monthly basis, broadband is still more costly than dial up by a $34.50 to $19.70 margin, according to our May 2008 survey. This pattern -- economic slowdown and a stall in tech adoption -- was evident in the 2001 recession with respect to general Internet adoption. At the start of that recession in March 2001, 57% of Americans were Internet users, a figure that changed very little over the next year. By March 2002, 58% of U.S. adults were online users.