Sorry Fiber Fans, I’ve Got Some Bad News

I contend that Leichtman Research Group is not asking the right questions.  If 77% of those surveyed do not know their Internet access speeds, then how could they know that they need greater speeds?  The surveyors should have asked consumers about the applications that they would like to use such as watching 3D and high definition movies, video conferencing, home security, gaming, remote access to home data, etc.  Other questions asked should be how many users in the house are typically doing these activities.  Only when you see how consumers want to use their broadband services can you ascertain that the wimpy <10 Mbit/s is not enough for future use.

More than 70 percent of U.S. broadband customers are happy with their overall service, ranking it between 8 and 10 on a 10-point scale, according to Leichtman Research Group. A mere 3 percent scored their service with a 3 or less on the recently conducted survey, while just 26 percent said they’re “very interested” in receiving faster speeds at home. In other words, big, bold fiber efforts, such as Verizon’s FiOS, aren’t yet supported by consumer demand.

Leichtman Research Group surveyed 1,600 broadband-enabled U.S. households to get its data, which will undoubtedly be used to tout the current broadband status quo, especially after the Federal Communications Commission earlier this month released similar findings. And if 77 percent of people don’t know exactly what their broadband speeds are, and 44 percent aren’t interested in them getting any faster, as Leichtman has concluded, then these data are another nail in the coffin for faster broadband speeds.

From an ISP’s perspective, there’s no real need to invest in expensive fiber-to-the-home deployments or even cheaper DOCSIS 3.0 upgrades if the demand isn’t there. The lack of demand and quick subscriber take-up is one of the reasons Verizon has halted its deployment of FiOS fiber-to-the-home service and instead focused on achieving a 40 percent penetration rate among those homes that already have access to it.

Article Continued on Bloomberg Businessweek…

About Mark Milliman

Mark Milliman is a Principal Consultant at Inphotonics Research driving the adoption and assisting local governments to plan, build, operate, and lease access open-access municipal broadband networks. Additionally, he works with entrepreneurs and venture capitalists to increase the value of their intellectual capital through the creation of strategic product plans and execution of innovative marketing strategies. With more than 22 years of experience in the telecommunications industry that began at AT&T Bell Laboratories, Mark has built fiber, cable, and wireless networks around the world to deliver voice, video, and data services. His thorough knowledge of all aspects of service delivery from content creation to the design, operation, and management of the network is utilized by carriers and equipment manufacturers. Mark conceived and developed one of the industry's first multi-service provisioning platform and is multiple patent holder. He is active in the IEEE as a senior member. Mark received his B.S. in Electrical Engineering from Iowa State University and M.S. in Electrical Engineering from Carnegie Mellon University.
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