Latest Broadband Numbers Highlight Persistent Problems

On August 26, our good friends at the Pew Internet and American Life Project released their latest research on home broadband adoption. As the Pew survey will be the most up-to-date, most quoted numbers when policymakers consider broadband-related measures, we take some time here to look at Pew’s findings. (1)

According to the Census Bureau’s July 2011 Current Population Survey, 98% of the U.S. population lives in Internet broadband coverage areas. (2) Pew finds that, as of May 2013, 85% of American adults ages 18 and older use the Internet and 70% of American adults have a high-speed broadband connection at home. This is a small but statistically significant rise from the 66% of adults who said they had home broadband in April 2012. Just 3% of American adults go online at home via dial-up connections.

The demographic factors most correlated with home broadband adoption continue to be educational attainment, age, and household income. Almost nine in ten college graduates have high-speed Internet at home, compared with just 37% of adults who have not completed high school. Similarly, adults under age 50 are more likely than older adults to have broadband at home, and those living in households earning at least $50,000 per year are more likely to have home broadband than those at lower income levels. Pew found that while 74% of whites have broadband at home, only 64% of blacks and 53% of Latinos have a home broadband connection.

Lee Rainie, the director of Pew’s Internet and American Life project, said this is the first time that Pew has measured broadband usage and how it relates to smartphone ownership and usage. Pew does not include smartphones in its definition of what constitutes a “broadband user” – mainly because there is no widespread consensus as to whether 3G or 4G smartphones qualify as “broadband” speed, and many would question whether they offer the same utility to users as a dedicated home Internet connection.

“Broadband users can consume and create many types of content in ways that dial-up users cannot, and our research has long shown major differences in these two groups’ online behavior,” said Aaron Smith, a senior researcher for Pew and the report’s co-author. “Smartphones may offer an additional avenue for Internet access that surpasses the dial-up experience in many ways, but those who rely on them for home Internet use may face limitations that are not shared by those with traditional broadband connections.”

In research released in June, (3) Pew found 56% of American adults own a smartphone of some kind -- compared with 70% who have broadband at home. Ten percent of Americans indicate they do not have a broadband connection at home, but they do own a smartphone (another way to say this is 32% of non-broadband users own a smartphone). That means that 80% of Americans have either a broadband connection, a smartphone, or both.

• 46% of Americans have both a home broadband connection and a smartphone
• 24% have a home broadband connection, but not a smartphone
• 10% have a smartphone, but not a home broadband connection. (Most of the people in this group are young, have never gone to college and make less than $30,000 a year.)

The remaining 20% of Americans have neither a home broadband connection nor a smartphone.

Smartphones are playing a role in bridging the digital divide between racial and ethnic groups. 79% of blacks and 75% of Latinos said they have either home broadband or a smartphone, a difference of 15% and 22% respectively.

But including smartphones in Pew’s broadband definition actually exacerbates differences in broadband adoption rates between young and old.

• 80% of young adults ages 18-29 have high-speed broadband at home, compared with 43% of seniors ages 65 and older—a gap of 37 percentage points.
• If smartphone ownership is included in the definition of home broadband, this gap actually increases to 49 percentage points, because young adults are more likely than seniors to own smartphones as well.
• Adding smartphone ownership to home broadband use, the proportion of young adults who have ”home broadband” under this definition increases from 80% to 95%, while including smartphones has no discernible impact on access rates for seniors—the 46% of seniors who have broadband or a smartphone is little different from the 43% who have broadband at all.

“A lot of the debate you hear about smartphones and other mobile technologies is that they’re a bridging tool that helps groups with lower levels of traditional access make up those differences,” said Smith. “And certainly, when you look at whites and nonwhites, that story comes into play. But when you look at young people versus older people and you add smartphones in, it actually makes that gap worse because so many 18-to-29-year-olds have a smartphone and so few people 65 and older have them that when you include them in the calculation, the gap between young people and old people actually gets bigger than when you didn’t have smartphones in the equation at all. It’s an interesting subversion of the conventional wisdom in a certain way.”

The groups most likely to have a home broadband connection or a smartphone, are whites (80%), those aged 18-29 (95%), the college educated (93%), those making more than $75,000 a year (95%) and suburban residents (83%).

“We’ve consistently found that age, education, and household income are among the strongest factors associated with home broadband adoption,” said Kathryn Zickuhr, research associate for the Pew and lead author of the report. “Many dial-up users cite cost and access as the main reasons they don’t have broadband, but for adults who don’t use the Internet at all, a lack of interest is often the main issue.”

“I think one of the valuable aspects of this work is reminding people that there’s a pretty sizable chunk of the population that, when they’re at home, there’s not necessarily a device they can bring up and answer the question they have at the moment or get the information that they need or accomplish the task they need to accomplish — that it’s much more difficult for those folks,” said Pew's Smith.

Writing in Wired, former White House aide to President Barack Obama Susan Crawford looked closely at the Pew findings and laments that the digital divide is persistent, with close correlations between socioeconomic status and home Internet access. The report is also a reminder that policymakers use the words “high-speed broadband” to include everything other than dialup access, which is far too broad a definition. Her concern is that some call any Internet connection of 4 Mbps for downloads and 1 Mbps for uploads as fast enough to be counted as broadband. It is dangerous to call everything ‘broadband,’ she writes, “because it allows us to pretend there’s a vibrant marketplace for high-speed Internet access, with satellite duking it out with cable modem access, mobile wireless supplanting the need for a wire at home, and no need for oversight or a change in industrial policy.”

Crawford argues that the wired and mobile wireless marketplaces are separate and puts even a finer point on what Pew researchers cautioned about: a mobile wireless device can’t substitute for a 21st century wire at home, because of the physics of a wireless connection and the expense of using a lot of bits per month. “Data caps,” she writes, “make these [wireless] connections an entirely different deal.” On the wireline side, she points out that the marketplace for high-capacity (200 GB per month), high-download speed (100 Mbps per month) wired connections is increasingly dominated by a series of local cable monopolies that can charge whatever they want. “Bottom line: As a result of consolidation and deregulation, many Americans pay too much for Internet access services that are second-class — because they aren’t fiber to the home — and not enough Americans can afford service.”

Crawford offers the following policy solutions: define high-speed Internet access to be fixed service of 100 Mbps, upload and download; get away from the use of the word “broadband,” with all of its confusing connotations; and make sure that these services are available to all Americans at reasonable prices.

Los Angeles Times columnist Michael Hiltzik echoed Crawford’s fears about local cable monopolies. “The filthy little secret of home and business Internet data services in the United States is that the vast majority of Americans receive them from their local monopoly cable provider, the two largest of which are the increasingly rapacious and indolent Comcast and Time Warner Cable,” he wrote. “Sure, many also receive data services via their smartphones, but those are pale options for services requiring capacious high-speed data streams, such as video: Not only are their speeds lower than what can be provided via a pipeline to the home, but they commonly throttle data speeds after you use as little as 2 gigabits in a month. That's not enough to view a single high-definition feature film from Netflix.”

Hiltzik points out: “In a truly free market, the cable industry would move heaven and earth to stay ahead of potential competitors by keeping their networks at the cutting edge in speed and capacity. That's not happening. In 2011 and 2012 combined, Time Warner spent $3.6 billion, or less than 9% of its $41 billion in revenue, to maintain and upgrade its data network. Comcast spent an even lower share — 3.7% of its $118.3-billion revenue.”

For those who might argue that Crawford and Hiltzik ask for too much, we return to these goals of the National Broadband Plan released in March 2010:

1. At least 100 million U.S. homes should have affordable access to actual download speeds of at least 100 megabits per second and actual upload speeds of at least 50 megabits per second.
2. The United States should lead the world in mobile innovation, with the fastest and most extensive wireless networks of any nation.
3. Every American should have affordable access to robust broadband service, and the means and skills to subscribe if they so choose.
4. Every American community should have affordable access to at least 1 gigabit per second broadband service to anchor institutions such as schools, hospitals and government buildings.

The Pew research shows some progress, but we have a long way to go to reach our national goals.

Notes:
1. The Pew report is based on data from telephone interviews conducted by Princeton Survey Research Associates International from April 17 to May 19, 2013, among a sample of 2,252 adults, age 18 and older. Telephone interviews were conducted in English and Spanish by landline (1,125) and cell phone (1,127, including 571 without a landline phone). For results based on the total sample, one can say with 95% confidence that the error attributable to sampling is plus or minus 2.3 percentage points. For results based on Internet users (n=1,895), the margin of sampling error is plus or minus 2.5 percentage points.
2. “Exploring the Digital Nation: America’s Emerging Online Experience.” National Telecommunications and Information Administration and Economics and Statistics Administration, June 2013. http://www.ntia.doc.gov/report/2013/exploring-digital-nation-americas-em...
3. Aaron Smith, “Smartphone Ownership 2013.” http://pewinternet.org/Reports/2013/Smartphone-Ownership-2013.aspx