Broadband expansion has slowed sharply

Plugged in

September 22, 2005|By MIKE HIMOWITZ

If you read a newspaper, watch TV or surf the Web, it's hard to avoid that Verizon ad - the one that offers broadband Internet service for $14.95 a month.

Actually, call it Broadband Lite. With a maximum download speed of 768 kilobits per second, it has less than a quarter of the maximum speed of cable Internet service, and about half as much as Verizon's normal DSL connection.

But it's still a lot faster than dial-up - and just dandy for Web browsing and e-mail. It's also a third of the price of cable Internet service.

Why the bargain-basement offer?

A survey by the Pew Internet and American Life Project offers a clue. The results, to be released today, show that the pace of growth in broadband service is slowing sharply. And those who don't already have broadband are less likely to want it - or have the resources to pay for it.

According to Pew's June survey of 2,001 Americans, 53 percent of households with Internet service have broadband connections, compared with 50 percent in a similar survey in December 2004.

Statistically, that's almost no growth at all. In the period before that, the number of broadband connections grew by 20 percent.

The survey also shows that the remaining dial-up users are older and less avid Web surfers than dialup users were several years ago.

Dial-up users also tend to have lower incomes and education. So they're less likely to move to broadband at current price levels - about $30 a month for traditional DSL and $45 to $50 for cable. They're more comfortable with dial-up rates - typically $15 to $23 a month.

The slowdown comes after years of remarkable broadband growth. According to the Pew report, 5 million Americans had broadband connections when the Internet polling project began in 2000. By last June, that number had grown to 66 million, representing a third of the adult population.

But just under a third of the adult population doesn't use the Internet at all - and that proportion is holding steady.

Given those numbers, Verizon's offer of 15 bucks a month makes sense. Almost everyone who really wants full-blown broadband - and can afford it - already has it. The low price may entice some of the remaining fence sitters because it's no more (and often less) than they're paying now for dialup. The question is how many people will switch from more expensive services because they don't need the speed.

One problem dogging DSL is that it's not available everywhere. It depends how far you are from a central office and how your neighborhood is wired. For example, it isn't available in my area - which is in a new development just outside the Baltimore Beltway. You'd think these places would be prime targets.

The five-year-old Pew project, by the way, is one of the most accurate sources of Internet data I've found because its researchers use standard survey techniques (interviews with real people) and large samples. You'll find its reports at www.pewinternet.org

Down the tube department: Some columns get more reaction than others - but I have rarely received as much mail as I did over my two-parter on buying an HDTV.

Most readers liked it, including one woman who left voice mail thanking me for my "exposM-i." By that she referred to the revelation that many HD sets can't actually tune in a high-definition signal over the air. She said she'd pass the information on to her congressman.

Others, however, took me to task for a variety of sins. One reader was furious at the columns' alleged gross inaccuracies - my main offense being a failure to acknowledge that the rear-projection liquid crystal display (LCD) was the greatest invention since the light bulb.

Another said I was wrong when I wrote that LCD flat panel sets topped out at about 40 inches. He declared that LCDs as large as 70 inches are available. These two complaints are related, and deserve an answer.

Because of space limitations, it's hard to cover a topic as complex as HDTV in two columns. So I did leave out the use of LCDs as an image source for projection TVs. Yes, there are a handful of LCD projection sets available, and yes, they're very expensive.

For example, the 70-inch Sony KDF70XBR950 carries a price tag of $5,000 to $6,000. It's a rear-projection unit that derives its image from a much smaller LCD screen. It is not a flat panel and will not produce the same quality as a true LCD of that size - if an LCD that large were available.

On the other hand, more research did turn up a few real LCDs in the 42- to 46-inch range, so for that omission I apologize. In the "get real" range, Samsung has introduced a 57-inch LCD (Model LNR570D), which lists for $16,000. I was able to find it on the Web for a mere $14,500. Hard to pass up a bargain like that - buy one for the living room and one for the bedroom?

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