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U.S. Broadband Growth Slowest in Eight Years - InternetNews.
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U.S. Broadband Growth Slowest in Eight Years

Today brought more bad news to those who fear that the U.S. is falling behind in broadband.

According to a new report by broadband, media and entertainment analyst firm Leichtman Research Group (LRG), the U.S. added a net 634,000 broadband subscribers during the second quarter of 2009.

That's the worst quarterly performance in the eight years that LRG has been tracking this statistic, the firm said in a statement.

Slightly ameliorating the news is the fact that the second quarter of any year is usually the worst for this statistic.

"The second quarter has proven to be traditionally weak for broadband growth, but with the market becoming more mature, broadband adds further waned in 2Q 2009," Bruce Leichtman, president and principal analyst for LRG, said in a statement.

The biggest wins came at Verizon and AT&T, which added 186,000 and 112,00 subscribers respectively. Time Warner managed to add 94,000 subscribers while its larger rival Comcast eked out only 64,000.

Together, the 19 companies represented in LRG's report accounted for 93 percent of the U.S. broadband market, the company said.

Leichtman said in an e-mail to that the decline in growth is happening because those that want broadband have it. "The rate of adoption is declining because the market is becoming more mature," he said.

Partially as a result, the nation's sluggish showing won't be helped by the pending broadband stimulus spending, Leichtman said in an e-mail to InternetNews.com.

"The broadband stimulus will potentially bring landline services to the approximately 3 to 5 percent of U.S. households that currently don't have a landline offering," Leichtman said. "While this will benefit this portion of households (who otherwise would not receive a landline offering), the building of the networks will take time, and the impact on the overall market will be negligible in the near term."

He added that the effect of the stimulus will be "difficult to distinguish even when the networks are up and running, because this is represents a comparatively small portion of the U.S."

The new LRG finding also highlight some changing fortunes among broadband providers. For one thing, the phone companies beat cable in the quarter's new customers, and that's the inverse of what happened a year ago.

"In a reverse of last year's second quarter, when cable operators got three-quarters of the net broadband adds, telcos earned over 60 percent of the broadband net adds in 2Q 2009," Leichtman said.

When it comes down to speeds, however, cable remains ahead of the phone company.

"Eighty-nine percent of cable broadband lines had speeds of over 2.5 Mbps in the fastest direction -- compared to 46 percent of telcos' combined DSL and fiber lines," LRG said.