This morning, we published a new report — authored by Fred B. Campbell, Jr. — on the effect Title II regulation on communications investment in Europe, and what it could mean for investment here in the United States. The full report is available here, and below is a recording of a teleconference call discussing the report.
A new report from Bret Swanson of Entropy Economics (Swanson is also one of our Broadband Ambassadors) looks at the current state of competition in the online space and what that competition means for regulations. Titled “Digital Dynamism: Competition in the Internet Ecosystem,” the report is a lean 20 pages but packed with some startling facts and figures. Some examples:
• Private sector investment in high-speed Internet over the past 15 years amounts to $1.2 trillion.
• As a result of that investment, competition is strong and the U.S. broadband networks rank high globally when it comes to speed, and only South Korea generates more traffic than Americans.
• Due to how dynamic and unpredictable the industry is, top-down regulatory oversight is a major challenge, which highlights the need for a new approach from regulators.
Swanson’s paper also contains a graphic breaking down all the ways communication has changed since 1984. The full graphic is available here, but the image above is worth highlighting. Remember when communication meant phone-to-phone? Well things have certainly changed…
Deloitte has released a startling new report that exams how a lack of spectrum available for wireless use is threatening America’s lead in mobile broadband. Among the report’s findings:
• Policymakers need to address the potential spectrum deficit as well as new approaches to spectrum management.
• Investment in mobile broadband over the next four years could potentially increase the GDP by up to $151 billion and support over 700,000 jobs.
• Despite the private sector and the government working to address a spectrum shortage, demand for mobile broadband may “overwhelm the system,” especially as usage branches out from consumers to other sectors such as cars, traffic management, and health care.
Also in the report is what Deloitte calls the “Mobile Communications National Achievement Index,” which tracked wireless in 20 countries from 2004 to 2011. As Deloitte notes, for much of that span the U.S. enjoyed a comfortable lead over other countries when it came to wireless investment and usage. But in recent years, other countries have gained ground, which means if the U.S. is going to continue leading the world it will mean “maintaining a robust and adaptable wireless infrastructure capable of offering new services and meeting growing demand.
The full report, “Airwave overload?: Addressing spectrum strategy issues that jeopardize U.S mobile broadband leadership” is definitely worth digging in to. You can find it at Deloitte’s website in handy PDF form.
There are two new reports worth checking out today. FIrst up, a look at the benefits of broadband for businesses courtesy of Connected Nation:
• Nearly one in three businesses (32%) earn revenues from online sales. This translates into more than 2.4 million U.S. businesses
• Broadband-connected businesses bring in approximately $300,000 more in annual median revenues than non-broadband adopting businesses
• An estimated 4.4 million U.S. business establishments have websites, including more than 2 million businesses with fewer than five employees
• Teleworking also continues to have an impact in the marketplace, with 24% of rural businesses and 35% of non-rural businesses currently allowing employees to telework or telecommute
• Minority-owned businesses in the U.S. account for $49 billion in annual sales revenues from online sales (or 12% of total online sales in the U.S.). A large percentage of minority-owned businesses report using broadband to handle some or all of their business functions (79%, compared to 76% of all businesses on average)
• Overall broadband adoption gap is narrowing: In 2010, the home broadband adoption gap between African Americans and white Americans was 11 percentage points—in 2009, this was 19 percentage
points (56% for African Americans and 67% for white Americans in 2010).
• Target broadband adoption efforts at high school dropouts and households below $20,000 annual income: This group has persistently low broadband adoption—38% of African American and 51% of white American high school dropouts adopted broadband in 2010.
• Close broadband adoption gaps by linking it to jobs: Segment of African American population with low adoption has the most interest in using broadband for jobs—77% of African Americans and 17% of white American high school dropouts used broadband to search for jobs in 2009.
• African Americans are underrepresented in broadband jobs and businesses: African Americans were 8% of broadly-defined STEM occupations in 2010 and made 0.23% of revenues in information sector businesses in 2007. Broadband adoption can be leveraged to change this.
A new report from Recon Analytics casts a light on just how important the wireless industry is to America’s economy. The full report, titled “The Wireless Industry: The Essential Engine of U.S. Economic Growth, is available here (PDF), but here’s some highlights:
• The US wireless industry is responsible for 3.8 million jobs, directly and indirectly, an increase of more than 200,00 over the past six years; this accounts for 2.6% of all US employment.
• The wireless industry is now larger than the publishing, agriculture, hotels and lodging, air transportation, motion picture and recording, and motor vehicle manufacturing industry segments and rivals the computer systems design services and oil and gas extraction industries.
• The wireless industry and its direct and indirect employees paid $88.6 billion in taxes, including federal, state and local fees and taxes.
The report also looks at the current hot topic of spectrum, and finds that for every 10 MHz of spectrum made available to the wireless industry…
• US GDP increases by $1.739 billion
• US Employment increases by at least an additional 7,000
• Government revenues increase by $468 million
There’s much, much more to be found in the report. Check it out.
A new report from Sandvine looks at the effect video and real-time entertainment traffic is having on America’s mobile networks — and hammers home the need for both more spectrum and ongoing investment in wireless networks. Some highlights:
• YouTube is the largest source of mobile video traffic in every region examined, accounting for as much as 25% of network data and no less than 12%
• In North America, video and audio streaming make up more than half of mobile data traffic, led by YouTube, Pandora and Netflix
• Audio and video streaming will exceed 60% of North America’s mobile data by late 2014
• Click-to-cloud smartphone photo back-up and synchronization will emerge as a significant source of traffic worldwide: the phenomena of the continuous cloud/client connection
• In conjunction with the report, Sandvine released this short video on YouTube. Check it out.
At GigaOm, Om Malik highlights a new report from Akamai on the state of broadband adoption in America:
In the third quarter of 2011, global broadband adoption (2 Mbps or higher) grew 1.6 percent to reach 66 percent. The United States now has 81 percent broadband adoption, the report says.
While over 80% adoption is good, we obviously have a ways to go until we achieve the goal of 100% access and adoption. (Oddly enough, Bulgaria currently leads in adoption with 96% of the population connected.)
With the SOPA/PIPA bills aimed at curbing online piracy currently on hold, Gautham Nagesh of The Hillreports on a new study from the Computer and Communications Industry Association (CCIA) that finds piracy concerns by the entertainment industry may be overstated:
The report notes box office revenues grew 25 percent from 2006 to 2010, increasing from $25.5 billion to $31.8 billion. Meanwhile, spending on entertainment as a percentage of household income rose 15 percent from 2000 to 2008, and entertainment-sector employment grew 20 percent during that same decade.
The report says growth in employment for independent artists was especially strong during the last decade, at 43 percent, suggesting the Internet has actually made it easier for content creators to support themselves.
In response, the Recording Industry Association of America, argued the effects of piracy are very real:
“Trends in the United States have been clear, with a market less than half as large as it was 10 years ago and 60% fewer employees in the music business. Virtually every neutral academic study has concluded that there is real harm to the music community when people download music illegally,” [RIIA vice president for data analysis Joshua] Friedlander said.
With LightSquared still working to ease concerns its planned mobile broadband network will interfere with GPS devices, the draft of a new government report has been leaked to Bloomberg. From Todd Shields’ resulting article:
Philip Falcone’s proposed LightSquared Inc. wireless service caused interference to 75 percent of global-positioning system receivers examined in a U.S. government test, according to a draft summary of results.
The results from testing conducted Oct. 31 to Nov. 4 show that “millions of fielded GPS units are not compatible” with the planned nationwide wholesale service, according to the draft seen by Bloomberg News.
That’s pretty damning, and as you’d expect LightSquared is not happy about the leak. As The Hill‘s Brendan Sasso reports, the company’s CEO is complaining loudly:
[I]n a letter to officials at the Defense and Transportation Departments, Ahuja said that figure was based on “incomplete, selective, and slanted analysis of the data of the testing.”
He said the testing assumed LightSquared will operate its network at power levels 32 times greater than it really will.
Additionally, “certain critical information” necessary to interpret the data is not available yet, according to Ahuja.
On Tuesday, the FCC released the results of its broadband speed test, which measured whether advertised speeds from ISPs lived up to the actual speeds Americans were receiving. As Josh Smith of the National Journalreports, the survey found speeds are, for the most part, positive:
“We found that most major ISPs are providing service close to what they’re advertising,” FCC Chairman Julius Genachowski said at an event to unveil the findings at a Columbia Heights Best Buy store.
“This represents a significant improvement over the findings from two years ago, when we first shone a light on this issue.”
Expanding high-speed Internet access and adoption has been a top priority of the IIA for many years, and Rural America is home to a significant number of the broadband have-nots. As revealed by the joint USDA-FCC report, “Bringing Broadband to Rural America,” nearly one-third (28%) of rural residents still lack access to Internet speeds that accommodate the demands of today’s business world and enable advanced opportunities related to jobs, health care and education. Closing this divide will improve individual lives and strengthen our nation as a whole.
We applaud the Commission for placing focus on the Obama Administration’s goal of connecting 98 percent of Americans to broadband within five years and recognizing that ‘more needs to be done’ — in addition to ‘ongoing loan and grant programs’ administered by USDA’s Rural Utilities Service (RUS) and ‘regulatory reform measures and tools set forth by the FCC’ — to fulfill this objective of ‘widespread deployment of affordable, quality broadband services to every community.’ It is our belief that private sector investments and actions are also essential to driving rural broadband availability, in addition to these government efforts. For example, IIA Member AT&T’s proposed purchase of T-Mobile, which alone would bring broadband to more than 97 percent of Americans, would dramatically reduce the number of rural homes lacking broadband, leaving a far smaller gap to be filled by government funds, grants and loans.
Just the access to blogs like yours to find the best grocery deals has cut our food/grocery budget in half. We save a ton by keeping up with family and friends through e-mail, skype, and facebook rather than through post mail and long distance telephone calls. Access to research materials and online banking save me countless hours that I can put into other money saving ventures. I don’t think it’s $8,000 a year, but broadband internet access is definitely a good value for our household.
Planning my shopping trip with research online is a gas saver. No more running around town searching for the best deals.
Speaking of wireless, a new report from analytics firm comScore looks at mobile usage in Japan, Europe, and the United States. Among the report’s findings: Japanese users lead the way in usage of applications and mobile browsers, Europe leads in text messaging, and the U.S. — home of Facebook and Twitter — is tops in social networking and blogging.
The latest report from research firm TeleGeography finds that global Internet traffic has increased by 62% this year, down from 74% in 2009 but healthy nonetheless:
Growth rates varied significantly by region. The regions experiencing the fastest growth in international Internet traffic between mid-year 2009 and mid-year 2010 were Eastern Europe and India/South Asia, where average traffic growth exceeded 100%, and the Middle East, where traffic rose just under 100%.
In the U.S. and Canada — “mature markets,” as TeleGeography calls them — growth was up 54%.
IIA Co-Chairman David Sutphen has an op-ed for theGrio examining two recent reports from Pew that show suggest when it comes to closing the digital divide America is making progress:
A closer look at the Pew studies reveals that real progress is being made, through home broadband and wireless internet-connected devices, toward closing the digital divide for African-Americans. For example, from 2009 to 2010, the home broadband year-over-year usage rate of African-Americans increased by 22 percent from 46 percent to 56 percent, while the rate for white Americans and Hispanics remained largely steady. As a result, what was a 19 percent gap (whites 65 percent/African-Americans 46 percent) between white and African American home broadband rates in 2009, has dropped to an 11 percent gap (whites 67 percent/ African-Americans 56 percent) in one year. Moreover, Pew found that African Americans “lead the way” over whites and Hispanics in connecting to the internet through mobile handheld devices, and rank #1 when it comes to wireless data application usage.
The latest report from the Pew Center finds that nationwide home broadband adoption has increased — from 63 percent last year, to 66 percent so far in 2010. That’s the good news. The bad news, the Washington Post reports, is that support for the FCC’s National Broadband Plan is relatively lackluster:
When asked their views about efforts by the government to provide affordable high-speed Internet access to everyone in the country, 53 percent said the government shouldn’t attempt the effort or that it was “not too important” a priority, according to the Pew Center report. The phone survey of 2,252 adults comes as the Obama Administration and Federal Communications Commission have made it a priority to bring broadband Internet connections that are faster and more affordable to all homes.
Obviously, more needs to be done to educate the public at large that bringing broadband to everyone will benefit America as a whole. Unfortunately, the FCC’s current Title II distractions may be getting in the way of that effort.
Yesterday, the FCC released its latest report on broadband deployment. From Chairman Julius Genachowski’s statement about the report:
On Congress’s question of universality—whether all Americans are on track to being served—the best available data shows that between 14 and 24 million Americans live in areas where they cannot get broadband. These are mostly expensive-to-serve areas with low population density. Without substantial reforms to the agency’s universal service programs, these areas will continue to be unserved, denied access to the transformative power of broadband. So, taking account of the millions of Americans who, despite years of waiting, still have little prospect of getting broadband deployed to their homes, we must conclude that broadband is not being deployed to all Americans in a reasonable and timely fashion.
As is typical with the increasingly political FCC, reactions to the report’s findings split along party lines, with Commissioners Michael Copps and Mignon Clyburn — both strong supporters of stricter Internet regulations — siding with fellow Democrat Genachowski, while the Commission’s two Republican commissioners dissented. From Commissioner Robert McDowell’s statement:
Collecting granular data, including subscribership numbers, is important. But, subscribership data does not equate to the “availability” of broadband, which is what Congress requires the Commission to assess under Section 706. In many instances the Report confuses the facts by substituting the terms “deployment” and “subscribership” as if they were synonymous and interchangeable. They are not. “Deployment” and “subscribership” are two distinct concepts with different attributes and areas for improvement. Our task is to focus on Congress’ explicit directive to analyze deployment progress for purposes of the Section 706 Report. Today, however, the majority is sidelining the deployment figure of 95 percent in favor of a seemingly smaller subscribership number. It is only reasonable to question the rationale behind this confusing pivot.
From 2003 to 2009, under a consistent minimal regulatory framework, broadband providers have invested $27 billion annually in networks and infrastructure. Each year networks go further and faster. The National Broadband Plan found that 95 percent of the U.S. population has access to a 4 Mbps/1 Mbps terrestrial broadband service, and 80 percent have choice of broadband offerings. In every prior Section 706 Report, the Commission concluded that broadband deployment was timely and reasonable. In a striking departure from that decade of consistent Commission findings, the Commission has changed course by concluding that broadband deployment now is not reasonable and timely. I cannot support this decision. Broadband infrastructure deployment and investment are a remarkable and continuing success story, and I am troubled by giving such significant efforts a failing grade.”
Fierce Wireless digs through the latest numbers provided by Nielsen on mobile data usage:
When we look at smartphone data consumption distribution and year-over-year change, we see a large disparity of usage among smartphone users and are struck by the staggering amounts of data used by the heaviest users.
Average data consumption increased from about 90 MB per month during the first quarter of 2009 to 298 MB per month during the first quarter of 2010. This represents a year-over-year increase of approximately 230 percent. While this increase is substantial, in the first quarter of 2009 more than a third of smart phone subscribers used less than 1 MB of data per month; this number has dropped to a quarter in the first quarter of 2010 as the number of applications and the utility of smart devices has increased substantially. That means about 20 million current smartphone users are hardly using data.
The report also finds that the top 6 percent — the power users — consume more than half of all mobile data.
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