Overall Broadband Market Grows

By the broadest definition of broadband (cable, DSL, ISDN, and corporate LAN), the broadband market grew from 15.9 million individuals in April, 2001 to 25.2 million in April, 2002.

by Robyn Greenspan of cyberatlas.internet.com [May 23, 2002]

Nielsen//NetRatings reveals that the largest broadband markets achieved significant audience gains of at least 48 percent year-over-year in their respective high-speed populations this past April.

Overall, more than 25.2 million surfers at-home accessed the Internet via cable modem, DSL, ISDN, or LAN last month as compared to 15.9 million individuals in April 2001, increasing 58 percent year-over-year.

"Sixty-five percent of the top broadband metropolitan areas posted robust growth in their high speed populations, signaling that, while some barriers exist to broadband expansion such as increasing costs, there is healthy room for additional growth and adoption of broadband," said TS Kelly, director and principal analyst, NetRatings. "The largest broadband cities continue to grow."

Top 20 Broadband Cities, April 2002
Local Market		Unique Audience (000)	Year-Over-Year Percent Growth
1.	New York*	2,780	70.5%
2.	Los Angeles*	1,766	87.9%
3.	Boston*	1,120	48.4%
4.	San Francisco	1,110	21.0%
5.	Philadelphia*	785	69.9%
6.	Seattle	691	22.3%
7.	Dallas	623	12.8%
8.	Chicago	555	13.9%
9.	Washington DC*	532	153.2%
10.	Atlanta*	517	87.7%
11.	San Diego	497	15.0%
12.	Sacramento*	416	117.8%
13.	Detroit	411	8.0%
14.	Orlando*	401	183.0%
15.	Minneapolis*	368	94.3%
16.	Tampa	368	45.0%
17.	Hartford*	366	198.3%
18.	Portland*	366	105.1%
19.	Phoenix*	320	67.6%
20.	Baltimore*	310	174.4%
Source: Nielsen//NetRatings, April 2002
*Denotes local market is among the top 20 fastest growing broadband markets.

Moving from home broadband to professional usage, research from In-Stat/MDR shows that small business users account for nearly 34 percent of business broadband subscribers (DSL and cable), with expectations of increasing to nearly 40 percent by 2006.

Though the research shows that there are roughly twice as many cable modems as there are DSL lines in use by small businesses, the price disparity between these two classes of service is quite dramatic. In-Stat/MDR estimates that small businesses spent just over $331 million on cable modem services in 2001, a bit more than one-third of estimated DSL expenditures of nearly $1 billion. By the end of this year, these small firms are expected to invest roughly $800 million on cable modem services, showing significant growth, but this pales in comparison to expected expenditures of more than $1.5 billion on DSL at that time.

In-Stat/MDR believes that the price difference can be attributed to the fact that cable modems are found in the home, where they do not command much of a price premium, even for business users in this (or any other) market. DSL, in contrast, is most likely to be deployed in commercial locations in this and other markets, where monthly price premiums can reach over $100.

Leichtman Research Group, Inc. takes a look at the overall high-speed picture, documenting an increase of 6.6 million to nearly 12 million in U.S. broadband subscriptions, with nearly identical growth in cable and DSL connections.

"Five million new subscribers in a year is a major accomplishment for the broadband industry as a whole," said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc. "The challenges ahead for both cable and DSL providers are to find ways to continue to grow the subscriber base, and to add new services for existing customers."

The research firm sees year-to-year subscriber growth for cable at 78 percent, and DSL increasing by 79 percent. However, because the top cable providers began with a larger customer base, cable added almost twice as many subscribers as the major residential DSL providers. In the past year, the top cable companies added over 3.4 million broadband Internet subscribers compared to nearly 1.8 million broadband subscribers added by the four major DSL providers over the same time period.

Broadband Growth in the U.S., Q1 2002
Corporation	High Speed Subscribers	1 Year Ago	Net Adds
Cable Modem
Time Warner	2,195,000	1,183,000	1,012,000
AT&T	1,625,000	1,134,000	491,000
Comcast	1,040,500	574,300	466,200
Cox	1,001,311	587,170	414,141
Charter	747,700	324,600	423,100
Cablevision	559,765	303,800	255,965
Adelphia	377,500	150,906	226,594
Mediacom	112,300	79,800	32,500
Insight	88,100	30,300	57,800
Cable One	32,900	3,600	29,300
Total Top Cable	7,780,076	4,371,476	3,408,600
DSL
SBC	1,500,000	945,000	555,000
Verizon	1,350,000	720,000	630,000
Bell South	729,000	303,000	426,000
Qwest	484,000	306,000	178,000
Total Top DSL	4,063,000	2,274,000	1,789,000
Total Broadband	11,843,076	6,645,476	5,197,600
Source: The Companies and Leichtman Research Group, Inc. All data from Q1 2002, except Adelphia, Mediacom, Insight, Cable One from Q4 2001

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