Broadband Breaks Out Of The Doldrums

RESEARCHBRIEF

FROM THE CENTR FOR MEDIA RESEARCH

Tuesday, June 23, 2009

The latest findings of the Pew Research Center's Internet & American Life Project show home broadband adoption at 63% of adult Americans as of April 2009, a significant departure from the stagnation in adoption rates from December 2007 through December 2008, when home broadband penetration remained in a narrow range between 54% and 57%.

The study shows that the greatest growth in broadband adoption in the past year has taken place among population subgroups which have below average usage rates. Among them:

• Broadband usage among adults ages 65 or older grew from 19% in May 2008 to 30% in April 2009
• Respondents living in households whose annual household income is $20,000 or less saw broadband adoption grow from 25% in 2008 to 35% in 2009
• Respondents living in households whose annual incomes are between $20,000 and $30,000 annually experienced a growth in broadband penetration from 42% to 53%
• Respondents reporting that they live in homes with annual household incomes below $30,000 experienced a 34% growth in home broadband adoption from 2008 to 2009
• Among adults whose highest level of educational attainment is a high school degree, broadband adoption grew from 40% in 2008 to 52% in 2009
• Among adults ages 50-64, broadband usage increased from 50% in 2008 to 61% in 2009
• Adults living in rural America had home high-speed usage grow from 38% in 2008 to 46% in 2009

Population subgroups that have above-average usage rates saw more modest increases during this time period:

• Adults who reported annual household incomes over $75,000 had broadband adoption rate change from 84% in 2008 to 85% in 2009.
• Adults with a college degree (or more) saw their home high-speed usage grow from 79% in 2008 to 83% in 200
• African Americans experienced their second consecutive year of broadband adoption growth that was below average.

In the current survey, more than twice as many respondents said they had cut back or cancelled a cell phone plan or cable TV service than said the same about their internet service. In the past 12 months:

• 7% of all adults have cancelled or cut back online service
• 22% of adults have cancelled or cut back cable TV service
• 19% of all adults have cancelled or cut back cell phone service

However, notes the report, given that the survey shows that 85% of adults have cell phone service, it seems likely that cell phone users were economizing on service plans rather than foregoing service altogether.

Prices for home broadband service increased from 2008 to 2009. Home high-speed users who reported more choices of providers paid less than others.

Competition impacts broadband cost:

• Broadband users with one provider where they live (21% of home high-speed users) report an average monthly bill of $44.70.
• Among broadband users with more than one provider in their area (69% of home high-speed users), the average monthly broadband bill is $38.30.
• A subset of home broadband users who say four or more broadband service providers serve their neighborhood (17% of all home high-speed users) reported an average monthly bill of $32.10.

Overall, 55% of broadband users view a high-speed link at home as "very important" to at least one dimension of their lives and community, such as communicating with health care providers and government officials, or gathering and sharing information about the community. Some 84% of home broadband users see their fast connection as "somewhat important" or "very important" in at least one of these five realms listed.

When asked why they do not have the internet or broadband at home, non-users (either dialup subscribers or non-internet users) cite factors related to the internet's relevance, availability, usability and price. A third of dial-up users cite price as a barrier, with the remaining two-thirds citing other factors.

Consolidating the reasons mentioned across the two classes of non-broadband users shows that half of non-internet or dial-up users cite a reason that suggests they question the relevance of connecting to the internet - either at all or with high-speed at home.

For additional detail about the report, and access to the PDF file, please visit here.

For more information visit www.mediapost.com