The level of adoption of broadband in the United States remains relatively low, but demand, rather than supply, now is a key reason, Robert Atkinson, Information Technology and Innovation Foundation president, said.

 

While between 92 to 94 percent of U.S. households can subscribe to broadband – their residences are served by fixed broadband other than satellite – only approximately 65 percent subscribe, Atkinson said.

 

There are a number of factors that play a role in determining international ranking, including the extent of broadband network deployment. But ubiquitous supply is not enough, he says. In Japan 99 percent of households can subscribe to wired broadband, with over 80 percent being able to subscribe to very fast fiber to home connections. Yet its adoption rate is approximately the same as the United States, 61 percent, compared to 65 percent.

 

The three key factors are affordability, such as the cost of broadband service, the cost of a PC, usability, such as the lack of digital literacy skills, physical handicaps, and lack of relevance or perceived value as some people consider Internet a waste of time.

 

Training might help alleviate the second and third barriers, while time will contribute to easing the third barrier as younger people simply are more comfortable with technology. The cost issue might be, in some ways, the area where creativity would help most.

 

Broadband appears to be widely available in most low-income communities located in urban and suburban areas, Atkinson added. But adoption rates are much lower than in higher income areas.

 

One way to encourage adoption would be to provide stronger incentives for broadband service providers to sign up new customers, particularly in low-income neighborhoods. Currently, they have limited incentives to do so because the costs of getting new customers in these areas can exceed the revenues expected.

 

There are some non-market practices that could help, such as allowing use of current "lifeline" service funds to be used to defray the cost of fixed voice, fixed broadband or mobile service, he suggested. "E-rate" funds perhaps could help defray the costs of low income families owning a computer.

 

But some marketing creativity might help as well. As mobile providers now bundle equipment with service on contract plans, perhaps bundling equipment with lower-cost and usage-limited packages might help, he suggests.

 

"Yet, when some ISPs have attempted to pilot innovative pricing programs, including ones using bit caps, they have been criticized by some legislators and advocates for unfairly limiting user’s access and raising prices," Atkinson said.

 

"But such differential pricing can not only enable the network to be used more efficiently (by charging heavy users relatively more and light users relatively less), they could lead to broader availability in the marketplace of lower cost basic “no frills” broadband plans," he added.

 

The other issue is that many users with low needs to use some Internet-delivered services and applications might well opt for smartphone access.

 

And mobile alternatives might be a key part of the total usage profile. Anybody who has been in the global communications business for some decades has to be pleasantly surprised at how fast voice services now are being provided to the billions of people in many developing regions who have never made a phone call, where it once had been thought implausible to provide fixed voice services.

 

Mobile and wireless might play a bigger role in the U.S. market than once thought, as well.