Broadband Divide Continues

Earlier this week, the Department of Commerce's Economics and Statistics Administration (ESA) and the National Telecommunications and Information Administration (NTIA) released a study titled Exploring the Digital Nation: Computer and Internet Use at Home. The study analyzed 54,000 households using 2010 census data. Here's some details from a blog post at speedmatters.org:

• 68 % of households used broadband in 2010.

• Broadband adoption rates are slower that mobile.

• Households with lower incomes and less education, as well as Blacks, Hispanics, people with disabilities, and rural residents, were less likely to have Internet service at home.

• Seventy percent of urban households had broadband at home, compared to 57 percent of rural households.

• Less than half (43 percent) of households with annual incomes below $25,000 had broadband access at home, while 93 percent of households with incomes exceeding $100,000 had broadband.

Here's more from the study report:

• As of October 2010, more than 68 percent of households used broadband Internet access service, up from 64 percent one year earlier. Approximately 80 percent of households had at least one Internet user, either at home or elsewhere. 

•  Cable modem (32 percent) and DSL (23 percent) ranked as the most commonly used broadband technologies. Other technologies, including mobile broadband, fiber optics, and satellite services, accounted for a small, but growing, segment of households with broadband Internet access service.

• 2000s – continued to decline from five percent in October 2009 to three percent one year later.

• Over three-fourths (77 percent) of households had a computer – the principal means by which households access the Internet – compared with 62 percent in 2003. Low computer use correlates with low broadband adoption rates.

• Broadband Internet adoption, as well as computer use, varied across demographic and geographic groups. Lower income families, people with less education, those with disabilities, Blacks, Hispanics, and rural residents generally lagged the national average in both broadband adoption and computer use. For example, home broadband adoption and computer use stood at only 16 percent and 27 percent, respectively, among rural households headed by a Black householder without a high school diploma. Also, households with school-age children exhibited higher broadband adoption and computer use rates than other households.

• The differences in socio-economic attributes do not entirely explain why some groups lagged in adoption. Broadband Internet adoption disparities decrease when regression analysis holds constant certain household characteristics, such as income, education, race, ethnicity, foreign-born status, household composition, disability status, or geographic location. For example, the gap with respect to broadband Internet adoption associated with disabilities decreases from 29 to six percentage points when controlling for income, education, age, and other attributes.

• The most important reasons households without broadband Internet or dial-up service gave for not subscribing were: (1) lack of need or interest (47 percent); (2) lack of affordability (24 percent); and (3) inadequate computer (15 percent).

• Households reporting affordability as the major barrier to subscribing to broadband service cited both the fixed cost of purchasing a computer and the recurring monthly subscription costs as important factors. Our analysis of the expanded CPS data suggests that work, school, public libraries, and someone else’s house were all popular alternatives for Internet access among those with no home broadband Internet access service. Not surprisingly, individuals with no home broadband Internet access service relied on locations such as public libraries (20 percent) or other people’s houses (12 percent) more frequently than those who used broadband Internet access service at home.

The study also describes the $7 billion Recovery Act funding directed towards broadband in the U.S. Be sure to check out the complete study document linked here.

Verizon FiOS Buildout Essentially Done, Fixed LTE Coming

In a quarterly earnings conference call last Friday Verizon confirmed a couple of things I've been saying here for the past couple of years. The FiOS build out is basically done for now and Verizon Wireless will be offerring a fixed LTE option in direct competition with the landlind side of the business.

Here's an interesting Q&A from the VZ - Q3 2011 Verizon Communications Inc Earnings Conference Call held on October 21, as posted at DSL Reports:

Citigroup Analyst: Is there any thought of taking that non-FiOS bundle of presumably LTE broadband LTE voice,what about taking that more nationally and making that more of a national product for you versus just maybe an out of FiOS region but in territory Verizon product? 

Fran Shammo: Well, we are. And you're going to see that come in the fourth quarter with the -- what we now call the Cantenna which is not a commercial name obviously, but it's the antenna that we actually trialed with DIRECTV, which was extremely successful. And again, the benefit of this antenna is it operates the spectrum extremely efficiently. So if you look at a MiFi card or a dongle, this is very, very efficient, way above those two devices which is why it's critical to have that bundle with that Cantenna. So when we launch that you're going to see us go nationally with that type of an offer.

Rural Broadband - Holland, Massachusetts

The Springfield (MA) Sunday Republican runs a Q&A piece every week titled Just Ask. this past Sunday a woman who lives in Holland, MA posted a pretty interesting question. Before we get to the question though, let's take a quick look at Holland (source Wikipedia). According to the United States Census Bureau: 

• The town has a total area of 13.1 square miles (33.9 km²), of which, 12.4 square miles (32.1 km²) of it is land and 0.7 square miles (1.8 km²) of it (5.34%) is water. 
• As of the census of 2000, there were 2,407 people, 898 households, and 668 families residing in the town. The population density was 194.2 people per square mile (75.0/km²). There were 1,317 housing units at an average density of 106.3 per square mile (41.0/km²). 
• The median income for a household in the town was $52,073, and the median income for a family was $57,024.
• Holland has it's own elementary school but is considering merging its elementary school with the town of Wales. Holland students attend Tantasqua Regional Junior High School (grades 7-8) and Tantasqua Regional High School in Sturbridge.

A typical rural New England town that can be compared to likely hundreds of other rural communities across the U.S. Now for the newspaper reader question.

Question: Is it true that Verizon Communications does not have fiberoptics in my home area, Holland, and that there are no plans to install same? What I have now is a dial-up modem with Verizon, and it is very slow. It takes 10 full minutes for me to access my checking account online, after four screen changes. I understand the need for security, but this is ridiculous. I’m a teacher and need to cover a lot of ground on the Internet in a single day. At such snail speeds, I’m limited to very few online tasks like collecting emails. Over the past three years I have made numerous calls to Verizon service to ask if I could sign-up for high-speed Internet service, and the answer was always “no.” 
In this year of speed-of-light communications, do I have any other options? 
– Kathleen McGrory, Holland 

And the answer from reporter Jim Kinney:

Answer: While it is true Verizon does not offer DSL service for people in your area of Holland, there are other options available. Cox Communications, Holland’s cable provider, does offer provide high-speed Internet in this area. Since you sent us this inquiry, we understand you signed up with Cox’s Broadband service and can now quickly access your checkbook online. Welcome to the 21st century, Kathleen. 
Verizon spokesman Philip G. Santoro said, “There just aren’t enough customers there (for Verizon) to justify the expense.” He suggested people like you contact their local cable operator.  He also pointed out that there is a third option, and that is Verizon Wireless’ 3G coverage, which would provide high-speed Internet through cell phone coverage.

Many small rural towns in the U.S. do not have any option except dial-up. It is upsetting to read the Verizon spokesman's honest answer regarding high speed landline based service in Holland. Nothing against Verizon - it's the frustrating reality of situations across our country. From a business perspective it does not make sense for a traditional telephone company to offer high-speed data service in a town like Holland. With current data caps in place from Verizon Wireless and other providers I don't see 3G (or upcoming 4G) services as a competitive alternative. 

Holland residents are fortunate they do have a cable option. Many similar communities in our country are stuck with dial-up as their only option.


9/14/11 at 7:28 PM

This comment came in from retired Cable Executive Steven Solomon via Google+.

Gordon, I would add this comment to your post. What is often invisible to the public is the real demographics of a community like Holland. I know about this first hand. I helped negotiate the cable TV franchise with the town on the part of the predecessor provider to Cox, Continental Cablevision.

As of 1994, of the 2,400 or so residents of the town, only about 600 homeowners lived in their homes all year round. The rest kept their residences as vacation or second homes. This put the full-time residents at a great disadvantage in getting broadband by landline of any sort.

Putting in broadband plant at about $20G a mile is not a reasonable business proposition for the private sector if the company is relying only on the margin earned from Internet (which now competes with phone and cable TV). Thus, I don't see any alternative to the private sector stepping in with the 21st century equivalent of rural electrification.

Massachusetts Broadband Institute Announces Grant Awards

The Massachusetts Broadband Institute (MBI) announced $335,000 in competitive grant awards today. These grants are part of  MBI's Last-Mile Broadband Solutions Program to advance last-mile solutions and expand broadband connectivity in underserved areas of Massachusetts - specifically in western and north-central parts of the state. Providers will use a combination of new technology and existing infrastructure to eventually tap into MassBroadband 123, the MBI's 1,338 mile Internet backbone network that will extend broadband access to over 120 communities in western and north central Massachusetts.

Here's more detail from the MBI website:

• The broadband planning grants were designed to fund the development of market studies, business plans, network engineering and designs, and other actions needed to develop and implement last-mile broadband solutions.
• Grant recipients were selected through an open, rigorous and highly-competitive process. 
• MBI funded broadband planning and deployment grants up to a maximum of $50,000 per provider and project, supported by a 25% funding match from the grant recipient. 

Here's details on the municipalities, broadband service providers and organizations that received grants today;

Broadband Planning Grants

• The town of Leverett, in collaboration with Crocker Communications, will receive $40,000 to plan a Fiber to the Curb network, serving all 640 homes in the community.
• The town of Royalston will receive $11,250 to design a wireless network to serve the community.
• The organization WiredWest will receive $50,000 to further develop their broadband network design and business model that will serve 47 communities in western Massachusetts.

Broadband Deployment Grants

• Mid-Hudson Cable, an Internet service provider, will receive $44,000 to deploy a wireless network to provide access to approximately 185 homes in the town of Tyringham.
• GAW High-Speed Internet will receive $40,000 to deploy a wireless network in the town of Ashfield to provide access to approximately 200 customers.
• AccessPlus will receive $50,000 to deploy a new wireless network to service 170 homes in Savoy and surrounding communities. 
• The town of Warwick will receive $50,000 to expand and upgrade its wireless network to reach 400 more unserved homes in town. 
• The town of Princeton, in collaboration with Ayatch Wireless, will receive $50,000 to expand its wireless network to reach 100 more customers.

Watch www.massbroadband.org for more information.

Verizon and Rural Fixed 4G LTE Wireless

The turkey's just about gone at our house, transitioning from a Thanksgiving Day bird to turkey sandwiches, turkey salad, turkey chili and maybe (just maybe) some turkey soup. It was a nice relaxing holiday and like most people, I enjoyed watching some football on Thanksgiving day - it was especially good this year because the New England Patriots were playing the Detroit Lions. Go Pats!

During the game on Thursday I found one commercial particularly interesting - the new one from Verizon Wireless 4G LTE (Long Term Evolution). If you have not seen it - here it is.

What's so interesting?

• The commercial is rural focused - no fancy city slicker stuff here and no mobile/cell phones are shown. What looks like an old farm that could have been taken out of the 1940's - the kind of location telcos like Verizon have avoided or, at most, have been trying to push low bandwidth DSL service to.
  
• The farm in the commercial looks like it only has electrical power strung on poles - take a look around 6 seconds into it - there are some poles running down a very long driveway. I only see one cable and it looks like power to me. I guess they could be telephone wires or the copper could be buried for phone service.

So, we've got this rural farm out in the middle of nowhere with this big long driveway/access road. Not a place anyone would expect to find any kind of internet access beyond dial-up or maybe some kind of satellite service. The kid runs back with the Verizon package and.... you see the rest..... broadband!

Picking the commercial apart here's what I see for today and the future:

• Verizon will be pitching LTE as a both a mobile and a fixed service. Fixed service will be pushed especially in rural areas where other broadband options are not available. LTE won't just be for mobile devices and the commercial makes this clear.
• Initially fixed voice and data services will be available but in time, we'll likely see a video service being sold. But - with all of the major networks streaming now along with companies like Hulu and Netflix delivering online content - the line is rapidly blurring between data and video services.
  
• Can video be delivered over LTE - yes. There are capacity issues when it comes to the number of cell towers and backhaul fiber that needs to be run to the towers to handle the load. Over time this will be taken care of. I think we'll see something similar to the Optical Network Terminals (ONT's) used for FiOS installed in people's homes - they will be called WNT's (Wireless Network Terminals) or something like that.
• Verizon FiOS is basically finished - what's there and in the process of being negotiated is there. Nothing more at least from Verizon when it comes to fiber to the home (FTTH). For now. the push is wireless.

Things are (finally) going to start moving - Verizon Wireless claims they will have full nationwide LTE coverage by 2013. AT&T is not far behind when it comes to roll-out plans and Sprint/Clearwire has had WiMax (a competing 4G service) availble for the past year or so.

Living in rural New England with only one broadband option I'm pretty excited about the kind of competition LTE is going to bring. When it comes to the Patriots though - I'm not real excited about the competition those New York Jets are bringing - they are a really good team!

DSL = (D)ead, (S)low and (L)ousy?

That’s what a post over at Stop the Cap! called Digital Subscriber Line (DSL) after reviewing a report from Credit Suisse analyst Stefan Anninger. Here’s some highlights from that report:

• DSL will increasingly be seen as the “dial-up” service of the 2010s, as demand for more broadband speed moves beyond what most phone companies are willing or able to provide.
• DSL accounts sold in the United States top out at an average speed of just 4Mbps, while consumers are increasingly seeking out service at speeds of at least 7Mbps.
• A growing number of Americans understand cable and fiber-based broadband deliver the highest speeds, and consumers are increasingly dropping DSL for cable and fiber competitors. Any investments now may be a case of “too little, too late,” especially if they only incrementally improve DSL speeds.
• By 2015, cable companies will have secured 56 percent of the broadband market in the U.S. (up by 2 percent from today), phone companies will drop from 30 percent to just 15 percent, Verizon FiOS, AT&T U-verse, and wireless broadband will each control around 7 percent of the market, with the remainder split among municipal fiber, satellite, and other technologies.
• An online survey of 1,000 consumers in August found that less than half would consider going wireless only. The reasons? It’s too slow, too expensive and most plans have Internet Overcharging schemes like usage caps and speed throttles.

Regarding the FCC’s recent push for broadband reform by reclassifying broadband under Title II - Anninger suggests that Net Neutrality enforcement at the FCC is not a priority. Anninger goes on to say if action hasn’t been taken by winter or spring of next year, it’s a safe bet the Commission will never re-assert its authority.

Why Broadband Service Is So Poor In The U.S.

In an October 4, 2010 editorial titled Why Broadband Service in the U.S. Is So Awful And one step that could change it, Scientific American discusses the poor condition of U.S. broadband service when compared to much of the rest of the world. Here’s a couple of key points (we’re all way too familiar with) from the piece:

• The U.S. came in dead last in a recent study that compared how quickly 40 countries and regions have been progressing toward a knowledge-based economy over the past 10 years.
• A decade ago the U.S. ranked at or near the top of most studies of broadband price and performance.

From the top of the list to the bottom – what happened in the last 10 years? Scientific American traces the start of our problems back to 2002 when the Federal Communications Commission (FCC) reclassified broadband Internet service as an “information service” rather than a “telecommunications service.” This reclassification allowed infrastructure owners (essentially telco and cable companies) to keep their infrastructure private (some would say monopolize), stifling competition.

How are places like Japan and Korea different? Countries that are beating the pants off us require infrastructure companies to wholesale access to independent providers. This means consumers in these countries have many options from companies competing on price and service. Simply said, broadband competition is good but unfortunately, we don’t have it.

Can we fix it? The Scientific American editorial also discusses the net neutrality debate. Here’s another piece:

A separate debate—over net neutrality, the principle that Internet providers must treat all data equally regardless of their origin or content—has put the broadband crisis back in the spotlight. Earlier this year a federal appeals court struck down the FCC’s plan to enforce net neutrality, saying that because the FCC classified the Internet as an information service, it does not have any more authority to ensure that Internet providers treat all content equally than it does to ensure that CNN treats all political arguments equally.

In response, the FCC announced its intention to reclassify broadband Internet as a telecommunications service. The move would give the FCC power to enforce net neutrality as well as open broadband lines up to third-party competition, enabling free markets to deliver better service for less money.

Sounds great but…. current FCC chair Genachowski has said that although he regards the Internet as a telecommunications service, he does not want to bring in third-party competition. The Scientific American editorial speculates this move may have been intended to avoid criticism from policy makers, both Republican and Democrat, who have aligned themselves with large Internet providers such as AT&T and Comcast that stand to suffer when their local monopolies are broken.

The Scientific American editorial is an excellent read along with the growing number of reader comments. Check it out.

100 Mbps Wireless To Your Home Coming Soon? Even Out In The Sticks?

It's likely just a matter of time before those copper telecommunications wires still connecting most of us are history..... in Australia..... and a little later..... in the United States.

Australia currently has a broadband goal of 100mbps to 90% of homes by 2018 and the country’s largest telecommunications firm, Telstra, and Nokia Siemens Networks, have demonstrated 100 Mbps of bandwidth downstream on a 4G LTE network over a 75 Kilometer distance - that is approximately 46.6 miles!

Here's an interesting broadbandbreakfast.com quote from Kalevi Kostiainen, head of Nokia Siemens Networks, Australia and New Zealand:

The benefits of LTE in urban environments are currently being deployed globally, having already been extensively tested and the business benefits well understood. Through this unique joint trial we can now see how LTE can be extended to provide cost effective solutions for rural and remote environments.

This year in the U.S., Verizon Wireless is rolling out LTE and next year AT&T will start their LTE rollout. In addition, Sprint/Clearwire continues to roll out 4G WiMax service. It is just a matter of time.....

Volunteer - FCC Broadband Study and Initiatives - Test Your ISP

I write fairly frequently about broadband in the U.S. - especially the lack of bandwidth when compared to other countries. Today the Federal Communications Commission (FCC) released some interesting survey results. Abt/SRBI and Princeton Survey Research Associates, International interviewed 3,005 American adults between April 19 to May 2, 2010. The survey used a random digit dial survey and was conducted in English and Spanish. The sample included both landline and cell phones.

Here's some details from a June 1, 2010 FCC press release:

• 80 percent of broadband users in the United States do not know the speed of their broadband connection - 71 percent of men do not know what speed they’re getting, while the figure is 90 percent for women.
• With respect to age, 73 percent of those between the ages of 18 and 29 do not know their home broadband speed, while the number goes up to 88 percent of people age 65 and over.
• Most Americans are satisfied with the broadband speed they are getting - 91 percent of broadband users say they are “very” or “somewhat” satisfied with the speed they get at home.

Regarding mobile connectivity:

• The comparable number for mobile broadband, which is not yet technologically capable of the same speeds as home broadband, is 71 percent satisfaction. As a point of comparison, 92 percent of cell phone users are very or somewhat satisfied with their cell phone service overall.

In addition, the FCC Consumer Task Force announced two initiatives that will help collect broadband data:

Initiative 1:

The FCC is asking for 10,000 volunteers to participate in a scientific study to measure home broadband speed in the U.S. Specialized hardware will be installed in the homes of volunteers to measure the performance of all the country’s major Internet service providers across geographic regions and service tiers. The FCC is partnering with SamKnows Limited in this effort, the same firm that successfully conducted a similar test in the United Kingdom. A Public Notice asking for comment on the test plan was released in April 2010 and can be found at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-10-670A1.pdf.

This study will culminate in a “State of Broadband” report to be released later this year. The tests are also a key part of the Broadband Action Agenda (described at http://www.broadband.gov/plan/broadband-action-agenda.html). The Action Agenda details a number of initiatives designed to foster competition and maximize consumer benefits across the broadband marketplace.

Anyone can register as a volunteer for this national test at www.TestMyISP.com. Volunteers will be able to track the performance of their own broadband service, as well as providing valuable data for the FCC, Internet service providers, and the public at large.

Initiative 2:

The FCC’s Consumer and Governmental Affairs Bureau is issuing a Public Notice today to look at ways to measure mobile broadband speed. More and more consumers are using mobile wireless devices to access the Web, sometimes as a primary Internet connection. The Public Notice asks for input on the best ways to measure mobile broadband speeds, the ways that speed measurements can be used to help improve service, and the information consumers should have about the speed of mobile broadband coverage.

The FCC welcomes comments from all interested parties and the general public on this Public Notice. Comments can be filed through the agency’s Electronic Comment Filing System at http://www.fcc.gov/cgb/ecfs/, or in other ways described in the Public Notice itself. The Public Notice can be found at http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-10- 988A1.pdf .

I've signed up as a volunteer for the first initiative and am reviewing the second initiative public notice - and recommend you do to!

Proposed Broadband Projects In Your Region

The Commerce Department’s National Telecommunications and Information Administration (NTIA) announced today that it received 867 applications requesting $11 billion in funding for proposed broadband projects reaching across the United States. These are second round Broadband Technology Opportunities Program (BTOP) applications that, when combined with approximately $4.5 billion in non-Federal matching funds applicants have committed, total approx $15.5 billion. Here's a breakdown of the round 2 proposals using the three Commerce Department proposal categories from the announcement press release:

Comprehensive Community Infrastructure: 355 of the applications, requesting approximately $8.4 billion in grants, are for Comprehensive Community Infrastructure projects, which focus on deployment of middle mile broadband infrastructure that connects community anchor institutions, such as schools, libraries, hospitals, and public safety facilities. For the second funding round, NTIA has allocated approximately $2.35 billion for such infrastructure projects.

Sustainable Broadband Adoption: 251 of the applications, requesting approximately $1.7 billion in grants, are for projects that promote sustainable demand for broadband services, including projects to provide broadband education, training, and equipment, particularly among vulnerable population groups where broadband technology has traditionally been underutilized. In the second funding round, NTIA has allocated at least $100 million for such projects.

Public Computer Centers: 261 of the applications, requesting more than $922 million in grants, are for public computer center projects, which will expand access to broadband service and enhance broadband capacity at public libraries, community colleges, and other institutions that serve the public. In the second funding round, NTIA has allocated at least $150 million for such projects.

Want to see what was submitted in your region or any other region in the United States? The NTIA has put up a nice search-able database linked here.

Time To Close A Telco Tax Loophole?

You may not have heard of a Reverse Morris Trust (RMT) - it's an obscure tax loophole that allows large telecommunications companies to dump assets on smaller weaker companies. In 2007 Verizon took advantage of one, selling off their landline services in Maine, Vermont and New Hampshire to Fairpoint Communications for $2.7 billion and saving $300 million in taxes for themselves. The biggest losers in that deal today are the people of Maine, Vermont and New Hampshire who are now left with deteriorating service after the recent Fairpoint bankruptcy. We've seen similar results in other places - in 2005 Verizon sold off landlines in Hawaii to Hawaii Telcom Communications. Hawaii Telecom also filed for bankruptcy in 2008.

Fast forward to today, the're another big deal in the works with Verizon looking to sell 4.8 million rural landlines in 14 states to Frontier Communications. It is estimated the Verizon/Frontier deal would save Verizon approximately $600 million in taxes due to an RMT. There's been considerable opposition to this deal - here's an interesting quote from a PC World article:

The deal is a "tax scam, at its base," added Ben Scott, policy director of Free Press, a media reform group. In a Reverse Morris Trust deal, the selling company can avoid paying taxes on its sold assets as long as its shareholders end up with more than 50 percent of stock of the buying company.

Tax scam or no tax scam - I'm not knocking the companies - if there is an opportunity to save money it is smart business to take advantage of that opportunity. What concerns me is what this is doing to the quality and growth of broadband services in the United States. We need to start building modern high bandwidth IP-based infrastructure everywhere in our country if we are to compete with the rest of the world. If RMT loopholes remains open, then telcos will most likely continue to expand their dumping of landline services and ultimately hurt us all - not just those living out in rural areas.

U.S. Representative Alan Mollohan (D-WV), is referenced also in the PC World article:

The Reverse Morris Trust deal with FairPoint should be an "ominous" sign for regulators looking at the Frontier deal...... Frontier will have to cut thousands of jobs, and Verizon will walk away with a tax break.....I'd prefer to see that funding go to extend broadband in West Virginia. This [deal] is not in the best interest of our state.

What can be done? U.S. Representative Paul Hodes (D-NH) has announced he will introduce legislation that would reform the Reverse Morris Trust (RMT). I personally believe this legislation is crucial if we are going to modernize the communications infrastructure in our country.

You can get more information on Reverse Morris Trusts, the tax loophole and working to close it at a site put up by Speedmatters.org linked here. If you agree with what you see there (be sure to also do your own research) you can send an electronic letter via the site urging your member of Congress to co-sponsor Rep. Hodes' legislation.

NTCA 2009 Broadband/Internet Availability Survey Report

Over the last 11 years the National Telecommunications Cooperative Association (NTCA) has run a broadband/Internet availability survey of member companies that measures deployment rates of advanced connectivity services. The NTCA refers to itself as "the voice of rural telecommunications," and, according to their website, is the premiere non-profit association representing more than 580 small and rural telephone cooperatives and commercial companies.

The 2009 survey was run in the late spring/early summer and 156 member companies (31%) responded. Here's some of the survey results:

• 98% of respondents offer broadband to some part of their customer base, compared to the 58% in 2000
• 98% of those who offer broadband utilize digital subscriber line (DSL)
• 59% utilize fiber to the home (FTTH) or fiber to the curb (FTTC) (up from 44% last year and 32% the year before that)
• 25% utilize licensed wireless
• 22% utilize unlicensed wireless
• 15% utilize satellite
• 10% utilize cable modem
• 78% of respondents’ customers can receive 200 to 768 kilobits per second (kbps) service.
• 73% of respondents’ customers can receive 768 kbps to 1.5 megabits per second (Mbps)
• 77% of respondents’ customers can receive 1.5 Mbps to 3 Mbps
• 53% of respondents’ customers can receive 3 Mbps to 6 Mbps
• 39% of respondents’ customers can receive greater than 6 Mbps.

Among the companies surveyed, the overall take rate for broadband service was 37%.

The full report is linked here.

A Summary Of The Verizon - Frontier Deal

Yesterday, Verizon and Frontier Communications announced an agreement that would sell off a large chunk of Verizon's rural markets. Here's a quick summary taken from DSL Reports pieces on the deal:

• Frontier will give Verizon $5.3 billion in Frontier stock and take on an additional $3.3 billion in debt.
• Frontier will get Verizon landline networks in Arizona, Idaho, Illinois, Indiana, Michigan, Nevada, North Carolina, Ohio, Oregon, South Carolina, Washington, West Virginia. Wisconsin and some rural areas of California.
• Frontier will grow to more than 7 million access lines in 27 states and will be the largest provider of voice, broadband and video services focused on rural to smaller city markets in the United States.
• Frontier will be picking up some FiOS - 41 local franchises and the state of Indiana will be transferred from Verizon.
• Approximately 11,000 Verizon employees will end up working for Frontier.
• Verizon Wireless and Verizon Business services in the listed states will not be transferred to Frontier.
• With this deal Verizon may eventually reach 80% FiOS coverage on their remaining footprint.
• It is doubtful Fiber to the Home (FTTH) services will be expanded in any of the transferred regions (by Frontier) in the near future.

According to DSL Reports, Frontier has struggled of late to deliver even 3Mbps worth of connectivity to many of its rural users according to posts in their forums, but Verizon CEO Ivan Seidenberg issued a statement saying Frontier would apply their "laser focus" on the needs of rural customers to ensure a smooth transition and quality service.

The deal is expected to take about a year to complete.

U.S. Dept. Of Agriculture: Rural Broadband At A Glance

The U.S. Department of Agriculture recently published an interesting six-page (short!) report titled Rural Broadband At A Glance . The report draws on research done by the Dept of Agriculture's Economic Research Service , the Federal Communication Commission and the U.S. Census Bureau.

Rural Internet is investigated and indicates rural residents are less likely to have high-speed, or broadband, Internet access than their urban counterparts. The main limitation of slower, dial-up Internet access is that many content-dense applications and documents, and such critical services as anti-virus protections, are not readily usable via dial-up due to low transmission capability and speed.

Circumstantial evidence in the report suggests that the difference in access may lie in the higher cost and limited availability of broadband Internet in rural areas. As a result, rural residents depend more on Internet use outside of the home, relying on places like the library, school, and work, where broadband Internet access is available.

Here's some selected report stats:

• Internet use is lower for individuals in rural areas (71 percent) than in urban areas (77 percent).
• In 2007, 63 percent of all rural households had at least one member access the Internet, at home or elsewhere, compared with 73 percent of urban households.
• Fifty-two percent of all rural households had in-home Internet access compared with 64 percent of urban households.
• In 2005, 30 percent of farmers were using the Internet for farm business; 2 years later, use had increased to 63 percent. As Internet adoption increases, the need for high-speed Internet also rises as online purchasing and marketing become the norm.

The report summarizes that rural communities have not been left out of the ever-changing information economy, although issues of equal access exist. Evidence suggests that the difference in access may lie in the higher cost or limited availability of broadband Internet in rural areas. The report indicates more information is needed, saying data on broadband use in households and businesses and its cost are needed to better address this issue.

You can download and read the full report PDF here.