Report Finds Broadband Demand Mixed

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Broadband supply is greater than demand, and many consumers are not tapping
into the high-speed pipe because it doesn't offer them a clear value, according
to a new report issued by the U.S. Department of Commerce Technology
Administration.

The study, based on a compilation of analyst reports and data, found that
while demand for broadband is still healthy and services are now available in
all but the most rural markets, its penetration rate remains at an underwhelming
10.4 percent nationwide.

Many customers are not tapping the high-speed pipe because of concerns that
it is too expensive; a lack of quality and variety of content such as movies,
music and local information; sparse customer support and complicated equipment
installation; and a wariness of the Internet because of security and privacy
concerns, according to the report.

The study concluded that while broadband is far from failing, there is a need
for more applications and services consumers want to provide a 'tipping point
for broadband demand and usage.'

This includes a call to the industry to develop digital rights-management
systems to encourage more online content and make broadband equipment easier to
use.

Service providers also need to expand the capacity of their existing networks
and look at alternative delivery methods, including wireless, fiber optics and
powerline schemes.

Improvements in the quality of electronic-commerce transaction systems and
more compelling new content were also strongly recommended.

'In the end, there will be no substitute for rich and varied applications
that ensure returns on broadband investment, even as we spread the word about
existing applications and how they can improve American business productivity
and quality of life,' the survey concluded.

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