RealTime IT News

Broadband Subs Pull Into Passing Lane

With broadband prices falling and demand rising, residential high-speed Internet adoption is expected to jump from slightly less than half of U.S. online households to 78 percent of households by the end of 2010, according to JupiterResearch.

"With a clearer value proposition and increasingly reasonable prices, the question people ask themselves is shifting from 'why would I get broadband?' to 'why wouldn't I get broadband?,'" Joe Laszlo, research director at JupiterResearch, wrote in the report.

Besides being welcome news for cable and digital subscriber line providers, the broadband boom bodes well for others in the Internet industry.

"It's liberating news for media companies, companies that design Web sites, maybe advertisers as well," Laszlo told internetnews.com.

"Everything we've written about rich media advertising suggests there's a lot of interest there."

Streaming media players should also be heartened, Laszlo said. Several efforts are under way to bring more video content online, a shift that's been aided by vastly improved streaming technologies.

In addition to traditional media companies, search engines including Google , are exploring video tools and offerings that will work best via broadband connections.

Today's research focused primarily on cable and DSL connections. Alternate broadband connections, such as satellite, are not popular enough to influence the forecasts.

It's possible that WiMAX , a wireless broadband technology, could bump up adoption estimates over the next five years, Laszlo said.

Equipment makers and carriers are currently testing the technology, but questions remain about standards, applications and business models.

The report comes a day after SBC said it would cut digital subscriber line rates to just $14.95 per month for new subscribers who ordered online.

The bargain-basement price could pressure cable ISPs and dial-up ISPs to trim prices as well, which run around $40 per month and $20 per month, respectively.

While broadband is booming, the overall online population in the United States will grow more modestly, added JupiterResearch, which is owned by Jupitermedia Corp. , the same parent as this site.

Over the next five years, it's expected to expand from 75 million households to 88 million households.

Other industry-watchers, like Lee Rainie, director of Pew Internet & American Life Project, have similar expectations. Rainie has predicted that U.S. Internet adoption will top out at about 70 percent of U.S. households over the next decade, a similar number to the percentage of U.S. homes that take cable TV.