Study: As Broadband Adoption Slows, Lower-Income and Rural Users Grow

The rate of high-speed Internet adoption in American homes declined dramatically during the past year. But a new survey shows strong broadband adoption growth among blacks, low-income households, rural residents, and people who have not graduated from college.

The research, conducted by the Pew Internet and American Life Project, found that 47 percent of Americans now have broadband in their houses. That’s 5 percent more than Pew found in 2006 and represents a growth rate of 12 percent.

While that’s a healthy rate, it pales in comparison to growth between 2005 and 2006, when Pew found a 40 percent increase in the number of homes connected to cable, DSL or other broadband networks. In early 2005, only 30 percent of American homes were broadband-enabled, said Pew.

The latest survey, conducted in February, found that 40 percent of African American homes are now connecting at high-speed, an 8 percent increase over 2006. “Since 2005, the percentage of African American adults with a home broadband connection has nearly tripled, from 14 percent in early 2005 to 40 in early 2007,” says the report.

It also found that 31 percent of homes in rural America now use broadband, 6 percent more than last year. The survey found a 9 percent increase in broadband adoption in homes with annual household incomes below $30,000. Thirty percent of those homes now have high-speed Internet access, according to Pew.

“There is, from ’06 to ’07, fairly moderate growth, but you do have some segments showing fairly strong growth, particularly lower income households,” said Pew Associate Director of Research John Horrigan, the report’s author. “It might not be a red letter day for advertisers when one of the growth segments is low-income. But as a friend of mine says, `It’s not that poor people don’t have money. They just don’t hold onto it.’ So there is an opportunity to reach other segments of the population who do have some spending power.”

Additionally, Pew found a 24 percent rate of adoption growth among people with less than a high school education and a 23 percent rate among those who attended college but haven’t graduated.

The survey found that, of all the homes reporting Internet access, 70 percent said they were doing so via broadband. Horrigan said the fact that nearly half of all American homes are now using broadband could explain the recently-declining rate of adoption, since the “low-hanging fruit” was picked in prior years.

Low rates of broadband adoption growth (less than 3 percent) were found among households with incomes between $30,000 and $50,000, among senior citizens and among people between the ages of 50 and 64.

Horrigan said the key to signing-up the remaining homes, assuming broadband is available, will be convincing them of the benefits — aside from the promise of speedier Web browsing — that broadband access can offer.

“These are folks that need to be persuaded that doing things online, whether consuming content or carrying out transactions, is more convenient and more interesting than sticking with their traditional means of doing it,” said Horrigan. “When we see, in this latest report, that three-quarters of people with household incomes over $70,000 have high-speed access, it says that those people have seen the light and know that broadband is a great way to consume information and stay in-touch with people.”

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