One often has to be careful about statistics related to broadband (25 Mbps or faster) internet access. There are some very common confusions.
Sometimes the issue of “supply” is conflated with “demand.” It is one thing to say a consumer “cannot buy” a service because it is not available. It is something else to say a consumer chooses not to buy a particular product.
Sometimes the confusion is definitional. The U.S. Federal Communications Commission defines “broadband” as 25 Mbps, minimum downstream speeds. That is not to say internet access is not available, or purchased. “Broadband” simply means a product offering speeds of at least 25 Mbps.
Such statistics often only refer to terrestrial networks using cables (cable hybrid fiber coax, telco fiber -o-home, fiber to curb or digital subscriber line). Satellite access most often is not enumerated, even when available virtually everywhere in rural areas from two suppliers or more.
Sometimes one sees a confusion of “people” and “locations.” Homes are one thing, the number of people living in homes is another thing. In the United States, the average number of people in each home is about 2.5 (2.3 by some estimates). Since cabled or fixed internet is sold to “locations,” citing “people” is not as accurate.
The reverse is true when counting mobile internet access. There, it is “people,” not places, that matter.
There are a few other nuances. There is a difference between estimated homes and “occupied” homes. And some reported homes are boats, trailers or rooms in houses or apartments.
With the caveat that I have not read the full report, NPD says in a recent report that 19 million rural residents do not have access to broadband internet.
If one assumes 2.5 people per household, that in turn implies 7.6 million households that might have internet access, just not at potential speeds of 25 Mbps. NPD also is said to argue that 100 million total people “do not have access to broadband.”
Since NPD also is reported to argue that “vast majority” of these underserved people are in rural areas, the numbers are off. The most-obvious reason is that reporters are confusing “households” (locations) with “people” (residents of those homes).
Differences are an issue, but saying X households lack “broadband” is not the same thing as saying X households lack internet access. Many homes that do not buy “broadband” do have access, just not at 25 Mbps.
The other obvious qualification is that such data deals only with service purchased from terrestrial providers.
Virtually all rural households can buy internet access at official “broadband speeds” from at least two satellite internet access providers, at speeds up to 100 Mbps.
NPD estimates that 31 percent of people do not have broadband service (25 Mbps download speed at a minimum). Qualifications are necessary. Such statements omit service from satellite providers that absolutely meets the broadband definition, and can be purchased by virtually every rural household.
If the average household has 2.5 people in it, then 100 million people works out to about 40 million households. It is hard to square such numbers with the claim that the vast majority of underserved households are in rural areas.
If 7.6 million represents “the vast majority,” it is hard to see how the total universe could be 40 million households. The official press release issued by NPD Group claims 31 percent of U.S. households do not “currently buy” a broadband service, defined as 25 Mbps.
And the issue of demand cannot be ignored, either. Many households choose--for whatever reasons--not to buy internet access service of any type. That is a demand issue, not a supply issue.
Gaps exist, to be sure. Up to this point, and possibly always, rural internet access speeds are, on average, slower than found in urban and suburban areas, for reasons directly related to the cost of network infrastructure. So some of the gap is supply related. But not all of the gap is supply constrained; some of the gap is produced by differential demand for the product in urban and rural areas.
That gap also exists with respect to buy rates. “Rural Americans are now 12 percentage points less likely than Americans overall to have home broadband; in 2007, there was a 16-point gap between rural Americans (35 percent) and all U.S. adults (51 percent) on this question,” according to the Pew Research Center.
You might think the differences are completely based on the supply of service, but demand also is an issue.
“Rural residents go online less frequently than their urban and suburban counterparts,” says Pew Research Center. “Roughly three-quarters (76 percent) of adults who live in rural communities say they use the internet on at least a daily basis, compared with more than eight-in-ten of those in suburban (86 percent) or urban (83 percent) areas.
Some 15 percent of rural adults say they never go online, compared with less than one-in-ten of those who live in urban communities (nine percent) and those who live in the suburbs (six percent).
The point is that some reports, and news stories about those reports, often are misinterpreted. Fixed internet access is not “all” internet access. “Broadband” is not synonymous with “internet access.” And homes are not the same thing as “people.”
It simply is not believable that “31 percent of U.S. households do not have a broadband connection.”
There are only about 122 million total U.S. households, according to U.S. Census Bureau statistics. That implies 38 million U.S. homes not buying internet access running at a minimum of 25 Mbps.
A more reasonable estimate would be that seven million to possibly nine million locations cannot buy 25 Mbps service from a terrestrial supplier, though virtually 100 percent can buy from at least two satellite providers.
