Study: Broadband Market Is Stabilizing - InformationWeek

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Study: Broadband Market Is Stabilizing

A Pew Internet and American Life Project survey says the number of high-speed users is up, while the number of Internet veterans wanting to upgrade has declined

NEW YORK (AP) -- Fewer Internet veterans wish to upgrade their dial-up lines to high-speed services in a sign that the residential broadband market is beginning to stabilize, a new study finds.

According to the study, released Sunday by the Pew Internet and American Life Project, 43 percent of dial-up users with more than six years of Internet experience say they want broadband. A year ago, 53 percent said they did.

Meanwhile, the share of Internet users with high-speed connections at home grew to 31 percent in March--reflecting 30 million people, or 16 percent of all Americans. That's up from 21 percent of Internet users with broadband in March 2002.

The findings suggest that many of the people who want broadband have gotten it by now, shrinking the pool of potential customers, said Lee Rainie, director of the Pew project.

"The overall Internet population has stopped growing in the United States. If there is no net growth, you eventually run out of veteran users who have spent a couple of years in dial-up mode and want to move to broadband," Rainie said.

Although some aren't getting broadband because they live in rural or other areas where it isn't available, Rainie said, the bigger factor is price: They don't see a compelling reason to spend as much as twice the cost of a dial-up line.

The study also found a slight shift among broadband users toward cable modems. In March, 67 percent connected through cable, up from 63 percent a year earlier. By contrast, 28 percent used souped-up telephone wires, called DSL, down from 34 percent a year earlier.

Although the percentage dropped, there is overall growth for DSL: 9 million users in March, up from 7 million. That compares with 21 million cable modem users this March.

The study was based on a random telephone survey of 1,495 Americans. The results have a margin of error of plus or minus 3 percentage points.

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