Worldwide Broadband Trends

Contrary to some published reports the Arizona-based research firm contends that broadband Internet services are alive and well in the U.S. and beyond. In one of its latest studies, Broadband 2002: DSL & Cable Modem Services Fuel Worldwide Subscriber Growth, In-Stat/MDR analysts examine the growth of broadband Internet access subscribers in the U.S. and worldwide.

Findings indicate that increasing user demands for faster connections to the Web spurred substantial subscriber growth over the past year. Based on In-Stat/MDR’s analysis, the number of worldwide broadband subscribers passed the 30 million mark at the beginning of 2002. Analysts forecast that by the end of this year, worldwide subscriber totals will surpass 46 million.

The high-tech market research firm reports that digital subscriber line (DSL) access has become the premier broadband platform in the international market, while cable modem services continue to do extremely well in the US.

However, the availability of broadband access remains the single greatest challenge to long-term broadband growth, since the majority of the world’s telecom infrastructure cannot yet support broadband access technologies.

Because of the low penetration and adoption rates expected for cable modems in the business sector, the residential market will continue to be the real battleground between the broadband access technologies. In the U.S., cable operators have rapidly made cable modem services available to the majority of their residential service areas, while almost ignoring the business community.

Not so fast
On the other hand, DSL has made inroads with American businesses, and service providers have managed to increase their residential footprint with self-installation service packages. A key advantage in winning new broadband subscribers in the U.S. has been the cable industry’s “Triple Play” bundled service package of voice, video and high-speed Internet access–a marketing package that DSL service providers can rarely match. In-Stat/MDR key findings include:

  • In late 2001, the number of worldwide DSL subscribers surpassed 17 million, enabling DSL service to replace cable modem service as the most widely used broadband access technology. A sharp rise in the number of DSL subscribers in the Asia Pacific region sparked worldwide DSL growth.
  • In the United States, cable modem subscribers continue to outnumber DSL subscribers by a wide margin. At the beginning of 2002, there were 7.12 million U.S. cable modem subscribers and only 4.6 million DSL subscribers.

According to In-Stat/MDR, other broadband access technologies like satellite broadband, fiber-to-the-home (FTTH), and fixed wireless services, are merely bit players in the world of broadband. The three services account for only five percent of current worldwide broadband subscribers.

Broader sense
Meanwhile, Boston-based research firm the Yankee Group has something to say about a broader sense of business broadband access.

The Yankee Group also finds that the broadband landscape is rapidly evolving. While new technologies have begun to replace dial-up connections in millions of homes in the U.S. and beyond, broadband connectivity to the enterprise has remained relatively static.

The Yankee Group reports that American businesses continue to rely on leased line services, mainly T1 and DS3 connections, which are provisioned from major voice and data carriers. According to its study, these types of connections will continue to serve as a core means of broadband connectivity. But new technologies that are maturing on varying timetables will continue to attract the interest of IT managers seeking cost savings.

According to Matt Davis, Yankee Group broadband access technologies planning service director, the enterprise space clearly has several credible options for alternative broadband connectivity for remote offices.

“Enterprise IT managers should expand their knowledge of these options to take advantage of substantial cost-saving potential,” Davis said. Especially when it comes to LAN-to-LAN interconnection, redundant fiber backup, and connecting disaster recovery systems.

Among the technologies profiled in the report, Broadband Connectivity: Options for the Enterprise, analysts review DSL, cable modem, passive optical network (PON), fixed wireless, satellite, and free-space optics (FSO) technologies that are each capable of delivering reliable cost savings in different deployment scenarios.

However, Yankee Group finds that DS1- and DS3-based technologies will not be easily displaced. While cost savings are attractive, enterprises will continue to view dependability and functionality as the most important features driving their broadband connectivity decisions.

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