There is no doubt that America Online
Inc. is the largest Internet community in the U.S., providing content through outsourcing services to some 20 million subscribers.
Unfortunately, determining who’s No. 2 and No. 3 isn’t nearly as easy. So how exactly does the Internet industry measure up?
According to NUA Ltd. of Ireland, the art of estimating how many Internet users are online throughout the world is an inexact science at best. Surveys abound, using all sorts of measurement parameters. After years of studying Internet usage reports, NUA arrives at an “educated guess” as to how many people are online worldwide.
According to their September 1999 assimilation of information, NUA contends there are 201 million Internet users in the world. NUA also reports that 112.4 million users reside in the U.S. and Canada. Translated, more
than 56 percent of the global online community resides in North America.
Nick Christenson, an independent Internet researcher, has been tracking the
size of ISPs since the summer of 1998. He said one of the tasks he had to accomplish for Sendmail Inc. was to
determine which Mail Transfer Agent was being used by the largest ISPs.
“That posed a bit of a problem for me, because we didn’t have a list of who were the largest ISPs,” Christenson said. “So I went out and searched the Net for such a beast, but found nothing.”
Consequently, Christenson decided to set up his Ranking Internet Service Providers by Size Web page, which is recognized by ISPs as one of the few sites distilling information about the size of competitor’s subscriber bases.
According to Christenson’s collection, the top 10 service providers in the U.S. account for about 36 million members of the online community. A quick total of all ranked ISPs with more than 100,000 subscribers adds up to nearly 43.7 million Internet users in the U.S. alone.
Most large ISPs estimate that for every paying subscriber, there are 2.5 actual users accessing the Internet through a single connection. If Christenson’s numbers are accurate, about 109.5 million people in the U.S. have Internet access.
Presumably that would leave Canada with the other 2.9 million potential Internet users in North America, in accordance with the NUA estimate. Either way, the numbers are close enough to say that there are more than 100 million Internet users in the U.S. and Canada.
But none of these numbers include 8,300 independent ISPs in the U.S. and Canada as reported by The List. Presumably, The List represents ISPs averaging less than 100,000 subscribers. Independent ISPs add another potential 8.3 million North American subscribers to the mix. Extrapolate that figure with the 2.5 average users per subscriber, and
there remains a potential to add another 20 million users to the North American online community.
Also disenfranchised from the calculation is how many users are lost or duplicated in reseller figures. For example, PSINet Inc. (PSIX) resells connectivity to business and ISPs alike.
Certainly, some of the home access users are accounted for in other ISP
calculations, but what about multiple-user lines supplied to businesses throughout the nation? Of those lines, how many business users also have Internet access at home?
None of the North American user figures account for duplicate access on
dial-up accounts. It’s been reported that as much as 70 percent of the
subscribers utilizing free Internet services use the connection as a
secondary means of access to the Internet, favoring their primary access through a paid service.
If most Americans are using
free Internet access as a back up service and 70 percent of the 3.5 million free access subscribers are duplicates to paid services, drop 2.5 million users from the North American online community.
Whether there are 43.7 million Internet users in U.S. and Canada or 129.9 million subscribers makes a big difference in market share.
Does it matter if America Online (AOL)
owns 46 percent or 15 percent of the market? Sure it does, because if MindSpring Enterprises Inc. (MSPG)
and EarthLink Network Inc. (ELNK)
obtain the governmental go ahead to merge, the combined companies become the second largest ISP in nation serving 7 percent or 2 percent of the market, depending how you look at it.
Otherwise, NetZero, Inc. (NZRO)
is the second largest Internet services provider in the nation with 3
million subscribers of which 900,000 may be unduplicated accounts.
Consequently, the top two sources for Internet service in the nation don’t own a modem bank between them.
