U.S. Drops Further in World Broadband Rankings
America Needs a National Broadband Policy, Not More Excuses
by Free Press
WASHINGTON — New broadband data released today by the Organization for Economic Cooperation and Development (OECD) shows that the United States now ranks 15th out of the 30 member nations in per capita broadband use — down from 12th place just six months ago and dropping from fourth place in 2001.
"We are failing to bring the benefits of broadband to all our citizens, and the consequences will resonate for generations," said Ben Scott, policy of director of Free Press. "There is no justification for America's declining status as a global Internet leader. Instead of more excuses, it's time for true national broadband policy that will put America's digital future back on track."
According to the OECD report, the United States ranks 20th out of 30 nations in the growth rate of broadband penetration over the past year.
"The growing digital divide between the United States and the rest of the world will have real-world consequences," said S. Derek Turner, research director of Free Press. "The growth trends indicate that the United States is likely to continue to fall behind the rest of the world in broadband penetration, which will have lasting and significant effects on U.S. economic performance on the global stage."
Free Press analysis of the OECD data found:
# Currently about 40 percent of U.S. households subscribe to broadband service. If the U.S. penetration level were as high as in Denmark or the Netherlands, this would translate into an additional 33 million total residential high-speed Internet subscribers, or a household penetration level of 67 percent.
# The benefits of higher broadband penetration accumulate exponentially. Thus even a minor increase in our ranking has a tremendous positive impact on American consumers. If broadband penetration were 50 percent of all U.S. homes, economists estimate that consumers would realize a $38 billion annual surplus. If household broadband penetration were at 95 percent, the consumer surplus would be $350 billion.
# According to "The Communications Outlook 2007," a forthcoming report from the OECD to be released in June, the world's broadband leaders pay far less than $1 per Mbps (Megabit per second). By comparison, U.S. consumers pay about $10 per Mbps.
At a Senate Commerce Committee hearing tomorrow on communications, broadband and competitiveness, Free Press, Consumers Union and the Consumer Federation of America will urge Congress to pursue a comprehensive national broadband policy that enhances competition, protects free speech, expands opportunities to bring new providers into the marketplace, and uses economic incentives to stimulate investment in underserved areas.
"The status quo is unacceptable," Scott said. "If we watch and wait, trusting that today's marketplace will magically solve the broadband problem, the United States will slip further behind the rest of the world, and the digital divide will widen — both domestically and internationally. These consequences are too severe to tolerate."
The new OECD data can be found here