Saturday, April 16, 2005

US broadband penetration lags

We're last in the G8 and only 13th in the world in broadband penetration. Countries with higher population densities have a big advantage in the economics of broadband deployment, but this author suggests that we've not been aggressive enough in policy making. Recent legislative fights over whether cities should be allowed to roll out universal WiFi make me wonder whether entrenched interests (e.g., of telcos or other providers) aren't slowing down deployment. The article does a nice job of describing how Japan, which lagged terribly in the late 90's, rapidly surpassed the US.

The point about innovation being driven by small companies in markets where broadband penetration is highest is very true. Consumers react to new technologies in unpredictable ways, so proximity is key to understanding which products and services will succeed. Tech innovators here are keenly interested in what Korean and Japanese kids are doing with their 3G mobiles and home fiber optic connections.

Foreign Affairs: Once a leader in Internet innovation, the United States has fallen far behind Japan and other Asian states in deploying broadband and the latest mobile-phone technology. This lag will cost it dearly. By outdoing the United States, Japan and its neighbors are positioning themselves to be the first states to reap the benefits of the broadband era: economic growth, increased productivity, and a better quality of life.

...The large broadband-user markets of Northeast Asia will attract the innovation the United States once enjoyed. Asians will have the first crack at developing the new commercial applications, products, services, and content of the high-speed-broadband era. Although many large U.S. firms, such as Cisco, IBM, and Microsoft, are closely following developments overseas and are unlikely to be left behind, the United States' medium-sized and smaller firms, which tend to foster the most innovation, may well be.

The Japanese and the South Koreans will also be the first to enjoy the quality-of-life benefits that the high-speed-broadband era will bring. These will include not only Internet telephones and videophones, but also easy teleconferencing, practical telecommuting, remote diagnosis and medical services, interactive distance education, rich multimedia entertainment, digitally controlled home appliances, and much more.

1 comment:

Anonymous said...


I would greatly appreciate a broader rollout of WiFi and broadband capabilities, but I do not believe that currently the degree of broadband distribution is an important gauge of our culture’s status. The entities and US involvement in driving the development are the important factors.

With all of this bandwidth, are the broadband connections leading to significant improvements in the quality-of-life for these societies or are they simply unused or serving as new sources of entertainment? While I have no doubt that you and I would utilize these high-end communications connections (to download a near endless quantity of technical articles, videos and diagrams), I do not believe the general public could make effective use of the bandwidth. Would you rather that Johnny read a book or downloaded the Lord of The Rings.

The failure to broadly distribute these capabilities, does not limit the possibility of US firms developing the hardware and products for use. The Japanese do not all drive luxury automobiles, but they certainly produce high-quality high-end cars that are consumed by Americans. Of course, echoing your previous blog posts, the product may be developed and engineered in the US, but the production will occur in China, India or Taiwan.

I was under the impression that the following the telecom buildup, there are huge amounts of unused bandwidth backbones in the US. However, I assume there is insufficient demand to support the investment of capital to install high speed couplings to consumers. On the other hand, in the popular press there was a good deal of discussion regarding “Internet Two”, a high-speed connection used by Institutions for transferring large amounts of data (and used by students to share files). So, I do not believe the US business community is being denied access to advanced resources to support operations.


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