Romania and High Speed Internet

David Byrd : Byrd's Eye View
David Byrd
Chief Marketing Officer for ANPI

Romania and High Speed Internet

I woke up this morning wondering what would be interesting to blog about today. As I generally try to avoid regurgitating anything, I was pleased to see the new report by the Communications Workers of America (CWA) on the state of high speed Internet access in America. The Speed Matters survey of Internet is an interesting read but relatively useless in understanding the actual state of affairs of the Internet in the U.S. As I mentioned earlier this week, understanding our position with regard to broadband means analyzing our success or failure based upon Access, Speed and Pricing (ASP). Without addressing these three elements simultaneously, broadband penetration statements suffer from the lies, damn lies and statistics syndrome. Yes, the U.S. lags the world in high speed Internet penetration. Yes, the U.S. ranks 25th in average Internet connection speeds globally. And yes, even Romania exceeds the average connection speed of the U.S.

That last comparison seems to be the crowning element for establishing the failure of US broadband penetration. It seems to be an interesting stat. Why would Romania have higher broadband speeds than the U.S.? Their form of government doesn’t give them an advantage. It is a semi-parliamentary democracy based on a bicameral Parliament with a Chamber of Representatives, a Senate and a President who is elected every five years. Additionally, they are a member of NATO. No advantage there. While 20.8% of Americans live in rural areas that is low compared to the 45% of Romanians who live in rural areas. Again, no advantage. The average Romanian earns around $430 a month compared to the U.S. average of $3392. Enough, let’s get to a possible answer and a bit closer to the truth.

Americans do not have the same compelling reasons or motivations as the Romanians for Internet access. In general, if you do not live in an urban area, you do not have access to television unless you have a high speed Internet connection. Moreover, there is real competition throughout the country for broadband services. Finally, just over 10% of the population lives in Bucharest, the capital city, where broadband speeds are highest nationally. Those are the positives, now for the negatives. Only 14% of Romanians have broadband Internet access and just 33% have any Internet access at all. The broadband infrastructure can support higher speeds than in the U.S. but the Romanian population appears to have a much slower overall adoption rate. 75% of Americans have internet access with 50% having broadband access. Comparing the U.S. to Romania is ridiculous but it makes for great press.

The reality remains; the U.S. lags economically similar countries such as the G7 in two areas of ASP, access and speed. Pricing is either better or very competitive but without access, it makes little difference. I understand the need to improve access to underserved areas but I remain a proponent of incenting broadband carriers to address the three legs of ASP in urban areas and expand into rural areas. Like it or not, 79% of Americans live in urban areas and they remain underserved when compared to the G7. I am not recommending that rural areas be ignored just that perhaps we can chew gum and walk at the same time. Address both demographics concurrently. Speed matters but having the full package of ASP matters more.

See you on Monday!

 

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