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Bandwidth Boom: Measuring U.S. Communications Capacity from 2000-08 - by Bret Swanson - 06.24.09

Bandwidth Boom: Measuring U.S. Communications Capacity from 2000-08 - by Bret Swanson - 06.24.09

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Published by Bret Swanson
U.S. consumer communications capacity grew 91-fold over the period 2000-08, leaping from an aggregate of 7.9 terabits per second in 2000 to some 717 terabits per second in 2008. That was good for a per capita increase from 28 kilobits per second to 2.4 megabits per second.
U.S. consumer communications capacity grew 91-fold over the period 2000-08, leaping from an aggregate of 7.9 terabits per second in 2000 to some 717 terabits per second in 2008. That was good for a per capita increase from 28 kilobits per second to 2.4 megabits per second.

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Categories:Business/Law
Published by: Bret Swanson on Jun 25, 2009
Copyright:Attribution Non-commercial

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05/11/2014

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Do U.S. citizens live in a Webified wonderland?Or do they suffer through a digital Dark Age?Several new reports make the dismal Dark Agecase, where a faulty broadband policy hasstarved us of communications power and theeducational and economic enlightenment it mightbring.But the testimony of many “BlackBerry orphans,”“blogginghead” pundits, Web workers, andtelepresent tweeting tweens suggested otherwise.There seemed to be proliferating evidence thatcommunications capacity and diversity wasflourishing.So we sought to quantify the growth of U.S.consumer communications capabilities over thelast several years. We took data from the FederalCommunications Commission (FCC) andnumerous industry and company sources, appliedour own analysis of the advance of various wiredand wireless technologies, and developed avariety of new measures, including: total U.S.consumer bandwidth, total bandwidth per capita,and sub-totals for both residential bandwidth andwireless bandwidth.We estimate that by the end of 2008, U.S.consumer bandwidth totaled almost 717 terabitsper second. On a per capita basis, U.S.consumers now enjoy almost 2.4 megabits persecond of communications power, compared to just over 28
kilobits 
per second in 2000. Theability of Americans to communicate andcapitalize on all of the Internet
ʼ
s proliferatingapplications and services is thus, on average,about 100 times greater than it was in 2000.
ENTROPY ECONOMICS
> BROADBAND REPORT <
______________________________________________________________________________________________________________________GLOBAL INNOVATION + TECHNOLOGY RESEARCH
Bandwidth Boom: Measuring U.S. CommunicationsCapacity from 2000 to 2008
BRET SWANSON> June 24, 2009
_________________________________
ENTROPY ECONOMICS LLC > 156 S. FIRST STREET > ZIONSVILLE, INDIANA 46077 USA > 317.663.0509 > ENTROPYECONOMICS.COM
0100000200000300000400000500000600000700000800000
 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0  5 2 0 0 6 2 0 0  7 2 0 0 8
Total U.S. Consumer Bandwidth
  g   i  g  a   b   i   t  s  p  e  r  s  e  c  o  n   d
Sources: FCC, industry reports, Entropy Economics
residential+wireless
 
State of Play: 2000
By the year 2000, the consumer Internet hadbeen around for about half a decade. The WorldWide Web, the Netscape browser, AmericaOnline, and email brought the Net to the massesin the mid-1990s. Consumers achieved access tothe Net almost exclusively through dial-upconnections, peaking at 56 kilobits per second, intheir homes or offices.Five years later, at the turn of the millennium, 5.1million Americans subscribed to broadband. Itwas a dramatic improvement over dial-up access,but the 3.3 million cable modem subscribers stillcould only hope for download speeds of around 1megabit per second, while 1.6 million DSL usersoften topped out at 500 kilobits per second.Upstream bandwidth for both access technologieswas often even more constrained, usually in the250-500 kilobit range. A business T-1 linedelivered 1.54 Mbps for $1,000 per month.Meanwhile, just a quarter of America
ʼ
s 115 millionmobile phone subscribers had even a rudimentarydata capability of around 10 kilobits per second ineither direction. Residential and wirelessconsumer bandwidth totaled 7.9 terabits persecond, yielding a per capita figure of just 28kilobits per second.The millennial technology and telecom crashwas, in part, a result of this broadband dearth.Thousands of Silicon Valley dot-com businessplans had been conceived on the assumptionthat real broadband would be rapidly deployedand adopted across the nation. More than half adozen communications companies tookadvantage of the newly deregulated long-haultransmission market and built nationwide fiberoptic networks, boosting
intercity 
bandwidth byseveral orders of magnitude. But
local 
telecommarkets weren
ʼ
t similarly deregulated. Theywere re-regulated. At the FCC and in 51 stateutility commissions, in fact, complex rules andprice controls grew for DSL and threatened toengulf cable modems as well. Investmentground to a halt. The resulting bandwidth gap,with the crucial last mile falling well short of themarket
ʼ
s expectations, helped produce thecrash, which lasted through 2002.
The Renaissance
The next five years would be very different. Aseries of technology breakthroughs, new businessmodels, and a very helpful relaxation of harmfulregulation complemented one another andproduced a bandwidth boom.Cable modems and DSL lines got faster and weredeployed more widely. Consumers saw morevalue and subscribed in greater numbers. Googlerevolutionized the Web with powerful search andproved a new advertising model could supportnew businesses across the cybersphere. Moreindustries integrated the Web into theirbusinesses and used it as a key channel to reachcustomers. Inexpensive digital cameras, barelyavailable in 2000, completely transformed thephotography market (and created substantial newbandwidth demand). BlackBerries transformedemail, blogs revolutionized journalism, and later,exciting new multimedia and social networkingapplications – Flash, YouTube, Facebook, Twitter – exploded.Perhaps nothing was more important to thisrenaissance than the advance of wirelesstechnologies. In 2002 and 2003, we got the firsttaste of both 3G mobile services and a new localarea networking technology known as Wi-Fi.These wireless air interface solutions brought apreviously unimagined level of connectivity to ourmost personal mobile and portable devices,dramatically expanding the range of times andplaces in whichwe accessed the Net. At about the same time Wi-Fi pioneer Sky Dayton appeared on the cover of
Wired 
in the fall of 2002, the cdma2000 mobilestandard, with peak throughput of 144 kilobits persecond, was introduced in the U.S. The next
ENTROPY ECONOMICS
2
ENTROPY ECONOMICS LLC > 156 S. FIRST STREET > ZIONSVILLE, INDIANA 46077 USA > 317.663.0509 > ENTROPYECONOMICS.COM
050000100000150000200000250000300000350000
 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4  2 0 0  5 2 0 0 6 2 0 0  7 2 0 0 8
U.S. Wireless Bandwidth
  g   i  g  a   b   i   t  s  p  e  r  s  e  c  o  n   d
Sources: FCC, industry reports, Entropy Economics
 
mobile leap, known as EVDO and peaking at 2.4Mbps, hit the market in 2004. And its widebandcousin WCDMA arrived in 2006. Over the nextfew years, many of these wireless technologieswould be integrated into the same device,producing “tri” or even “quad-mode” phones, andthis new wireless umbrella would help transformthe entire culture of the Web. Indeed, of the world.Rising from a nationwide total of just 600 gigabitsper second in 2000, consumer wireless bandwidthrocketed to 325 terabits per second by the end of2008. This was good for a per person leap tomore than 1 megabit per second from just 2kilobits in 2000, a 500-fold rise in eight years.Wireless bandwidth began the decade a paltryone-tenth that of residential. But wireless grew sofast in just the last few years that it was rapidlyapproaching residential bandwidth in 2008, wheneach delivered more than a megabit per capita.This bandwidth expansion yielded a generation of“CrackBerry” addicts, mobile maps, globalpositioning system (GPS) applications, integratedmusic players, and mobile Web surfing andvideos. The top two U.S. wireless serviceproviders report their networks now transmit, insum, more than 200 billion text messages percalendar quarter. In the last year, Apple
ʼ
s iPhone“App Store” has created a completely new modelfor mobile devices, where third party developerscreate a vast array of new applications for mobilecomputing, all delivered wirelessly at yourcommand. In its first nine months of operation,consumers downloaded more than a billion“apps,” choosing from a range of more than35,000 distinct offerings (now more than 50,000).Despite this exponential expansion, mobile andwireless networks and devices seem poised foreven greater innovation. Consider:Close to 50% of “smart phones” now have Wi-Fi, in addition to fast access over mobile phonenetworks.Increasing numbers of notebook computers areshipping with embedded 3G mobile connectivity,in addition to their traditional Wi-Fi capabilities.The Amazon Kindle book-reader created awhole new business model based onbroadband mobile connectivity.Nintendo
ʼ
s DS and DSi children
ʼ
s video gamemachines – (“Dad! Give me back my DSi!”) –have Wi-Fi connectivity.Apple
ʼ
s iPhone 3GS includes a 3 megapixelcamera and video recorder to
capture 
evermore content. Color-rich, high-resolutiondisplays on mobile devices will likewise promptmore content
viewership 
.RIM, Samsung, LG, Nokia, Motorola, Palm,HTC, and Sony-Ericsson have responded to theiPhone with new smart phones. The diversity ofmobile form-factors will grow.
ENTROPY ECONOMICS
3
ENTROPY ECONOMICS LLC > 156 S. FIRST STREET > ZIONSVILLE, INDIANA 46077 USA > 317.663.0509 > ENTROPYECONOMICS.COM
020040060080010001200
 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0  5 2 0 0 6 2 0 0  7 2 0 0 8
U.S. Wireless Bandwidth Per Capita
   k   i   l  o   b   i   t  s  p  e  r  s  e  c  o  n   d
Sources: FCC, industry reports, Entropy Economics
050000100000150000200000250000300000350000400000
 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0  5 2 0 0 6 2 0 0  7 2 0 0 8
U.S. Consumer Bandwidth
  g   i  g  a   b   i   t  s  p  e  r  s  e  c  o  n   d
residentialwireless

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