US vs. EU Broadband Trends 2012 – 2019
TABLE OF CONTENTS
Letter from Jonathan Spalter..........................................................................................................................................1 Key Findings....................................................................................................................................................................................3 US vs. EU Broadband Deployment » Coverage Households Covered with Fixed Broadband at Any Speed..........................................................................4 Households Covered with Fixed Broadband at NGA Speed........................................................................5 Households Covered with Fixed Broadband > 100 Mbps...............................................................................6 Households with 2 or More Wired Facilities Based Competing Providers........................................7 Households with 2 or More Facilities Based Competing Providers .......................................................8 US vs. EU Broadband Adoption » Take-Up Share of Households with Fixed Broadband Subscription at Any Speed..........................................9 Share of Households with Fixed Broadband Subscription ≥ 30 Mbps..............................................10 Share of Households with Fixed Broadband Subscription ≥ 100 Mbps............................................11 Share of Households with Broadband Subscriptions at 3 Speed Intervals...................................12 Why is the US Ahead?............................................................................................................................................................13
USTELECOM PARTNER Arthur Menko, BPI-Telcodata
LETTER FROM JONATHAN SPALTER
THE U.S. LEADS ON BROADBAND: THE KEY QUESTION IS WHY THE U.S. STANDS AT A CROSSROADS for its innovation policy. Congress and the Administration are stepping up with historic funding that works shoulder to shoulder with broadband companies to close the digital divide. As a result, we as a country are able to contemplate all the possibilities that the future of a universally connected nation might hold. But as we look to this future, it is imperative that we understand our nation’s path to global leadership in the information age. This means confronting persistent myths with data-driven facts when it comes to assessing the state of U.S. broadband. One of the most common and misguided claims is that the European Union’s (EU) more intensive framework for broadband regulation has somehow yielded a superior online experience for its consumers. The findings of this report flatly debunk this claim, and the data is undeniable: The U.S. leads the EU in broadband deployment and adoption—and this lead is even larger when rural areas and at higher-speed offerings are considered. Put another way, if the U.S. had followed the EU’s more regulatory path, then our nation’s digital divide could be more than triple what it is today—leaving an additional 39.5 million1 Americans without access to a broadbandfueled world of opportunities. EU leaders are keenly aware of their disadvantage. As far back as 2012, Europe’s chief telecom regulator warned that the “attachment to 20th century policy mindsets and business models is hurting Europe’s economy.”2 The following year, the full European Commission decried its “regulatory mess,” noting “the effect is that Europe is losing the global race to build fast fixed broadband connections. Concretely: telecoms companies are under-performing, other businesses are losing competitiveness and frustrated consumers are stuck in the internet slow lane.”3
1 Based on 2019 census figures and U.S. broadband services ≥ 30Mbps down/3 Mbps up. 2 https://telecoms.com/45731/kroes-europe-flattened-by-global-competitors-without-more-ict-investment/ 3 https://ec.europa.eu/commission/presscorner/detail/en/MEMO_13_756
1
LETTER FROM JONATHAN SPALTER
While European governments imposed heavy regulation on broadband—chilling investment in better, stronger and more farreaching networks—the U.S. bounded ahead by crafting a more collaborative approach between the public and private sectors. One outcome? Broadband companies invest more than three times as much in telecommunications infrastructure per household in the U.S. than in the EU—about $700 per home each year. This policy approach that encourages capital-intensive infrastructure work also has delivered to U.S. consumers a far more competitive broadband marketplace, with twice the facilities-based competition as EU consumers enjoy. This, in turn, has fueled a cascade of additional benefits from falling U.S. broadband prices4 to greater network resilience in times of crisis to the ability of American consumers to more fully utilize digital tools and resources, as evidenced by the fact that the average U.S. subscriber uses 60% more data than its European counterparts.5 From addressing the pandemic through remote work, telehealth and online learning to growing information-based jobs and entrepreneurial opportunities, our nation continues to reap the rewards of U.S. broadband leadership. As we look to the future, we should do so with a clear-eyed understanding of how we got here: The U.S. leads because smart infrastructure has been advanced by smart policy that helped spark more than $1.8 trillion—and counting—in private sector U.S. infrastructure investment.
Jonathan Spalter President and CEO, USTelecom
4 https://www.ustelecom.org/wp-content/uploads/2020/09/USTelecom-2020-Broadband-Pricing-Index.pdf 5 https://openvault.com/complimentary-report-4q20/
2
US VS . EU BROADBAND TRENDS 2012 – 201 9
KEY FINDINGS
KEY FINDINGS The U.S. handily leads the EU in both broadband infrastructure deployment and broadband adoption—at all speeds—and this lead grows when comparing higher speed offerings. • Deployment: U.S. leads EU by 12 percentage points at 30 Mbps; 25 pp lead for ≥100 Mbps. • Adoption: U.S. leads EU by 9.4 pp at 30 Mbps; 21.4 pp lead for ≥100 Mbps. The U.S. infrastructure advantage is most significant when comparing rural areas, despite the EU definition of “rural” including more population-dense areas (which allows costs to be spread across a much larger customer base). • U.S. leads EU in rural deployment by more than 20 pp at 30 Mbps. U.S. dominance on broadband adoption reinforces prior research showing encouraging progress on U.S. broadband affordability—with U.S. broadband prices declining, even as the costs of many other essential goods and services continue to rise. Broadband providers invest substantially more in U.S. versus EU infrastructure (≥3x on a per household basis). This can be attributed to a more collaborative public-private U.S. policy framework that encourages investment in facilities-based competition rather than imposing heavy government regulation (e.g. open access, unbundling). One added advantage of the United States’ pro-investment approach is that its consumers enjoy twice the facilities-based competition as their EU counterparts. It also has infused the country with extensive physical network redundancy and capacity, which can bolster resilience in times of crisis—from surging online traffic amid a pandemic to acts of cyberwarfare.
3
US VS. EU BROADBAND DEPLOYMENT » Coverage
HOUSEHOLDS COVERED WITH FIXED BROADBAND AT ANY SPEED » U.S. & EU in All Areas and Rural KEY TAKEAWAYS The U.S. leads the EU in broadband coverage at any speed. This lead extends substantially when comparing rural areas. This U.S. rural edge exists despite the more restrictive U.S. definition of rural.
EU ALL AREAS
US ALL AREAS
100% 97% 95%
95%
90%
EU RURAL
98% 96%
98% 96%
98% 96%
97%
98%
99% 97%
99%
99%
97%
97% 97%
95%
94%
93%
92%
92%
91%
US RURAL
95%
90% 85%
80%
75%
81%
2012
82%
83%
2013
2014
84%
2015
85%
2016
86%
2017
87%
2018
SOURCES: FCC, NTIA AND EC’S DESI DATA
The EU defines rural areas as ≤ 263 people per square mile. In the U.S. on average there are 17.4 people per square mile in rural areas. A majority (57% ) of the EU’s rural census blocks would be considered non-rural in the U.S.
4
US VS . EU BROADBAND TRENDS 2012 – 201 9
2019
US VS. EU BROADBAND DEPLOYMENT » Coverage
HOUSEHOLDS COVERED WITH FIXED BROADBAND AT NGA SPEED » U.S. & EU in All Areas and Rural EU ALL AREAS
US ALL AREAS
EU RURAL
KEY TAKEAWAYS
US RURAL
100% 90%
84%
82%
80% 70% 60% 50%
48%
48%
45%
In 2019, the U.S. was ahead by: • 12 percentage points overall • 20 percentage points in rural areas
36%
20%
0%
59% 52%
30%
10%
79%
74%
70%
66%
60%
55%
40%
72%
83%
80%
77%
95%
94%
93%
91%
89%
67%
63%
56%
54%
89%
The U.S. lead on deployment grows when considering only higher-speed offerings.
12% 2012
19%
24%
2013
2014
27%
2015
2016
2017
2018
2019
SOURCES: FCC, NTIA AND EC’S DESI DATA
US speeds: ≥ 25/3 (2012-14) and 30 Mbps (2015-2019); EU speeds: ≥ 30 Mbps down and any speed up.
5
US VS. EU BROADBAND DEPLOYMENT » Coverage
HOUSEHOLDS COVERED WITH FIXED BROADBAND ≥100 MBPS » U.S. & EU in All Areas KEY TAKEAWAYS The higher speed the offering, the more the U.S. pulls ahead on access. Lead extends to 25 percentage points in 2019 for ≥100 Mbps.
EU ALL AREAS
US ALL AREAS
100%
92%
90%
90% 80% 75% 60% 50% 40%
40%
54%
53%
52% 44%
46%
61% 49%
63% 55%
61%
67%
30% 20% 10% 0%
2013
2014
SOURCES: FCC, NTIA AND EC’S DESI DATA
6
US VS . EU BROADBAND TRENDS 2012 – 201 9
2015
2016
2017
2018
2019
US VS. EU BROADBAND DEPLOYMENT » Coverage
HOUSEHOLDS WITH 2 OR MORE WIRED FACILITIES-BASED COMPETING PROVIDERS » U.S. & EU in All Areas and Rural EU ALL AREAS
US ALL AREAS
EU RURAL
KEY TAKEAWAYS
US RURAL
100% 90%
86%
85%
84%
84%
86%
There is a 5X U.S. edge when comparing rural areas in 2019.
80% 70%
74% 66%
60% 50% 40%
43%
46%
48%
50%
48%
46%
46%
45%
44%
43%
52%
There is nearly 2x more facilitiesbased wired competition in the U.S. vs. EU
49%
30% 20% 10% 0%
7% 2015
8% 2016
9% 2017
11% 2018
11% 2019
SOURCES: FCC, NTIA AND EC’S DESI DATA
US: 2 or more Wired Providers | EU: A Cable and Telco Provider
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US VS. EU BROADBAND DEPLOYMENT » Coverage
HOUSEHOLDS WITH 2 OR MORE FACILITIES-BASED COMPETING PROVIDERS » U.S. & EU in All Areas and Rural KEY TAKEAWAYS Adding fixed wireless to the competitive mix, U.S. consumers enjoy an even greater advantage. There is over 2x more facilitiesbased competition in the U.S. vs. EU There is a nearly 8X U.S. edge when comparing rural areas in 2019.
EU ALL AREAS
US ALL AREAS
EU RURAL
US RURAL
100%
90%
90%
90%
91%
91%
68%
70%
70%
80%
78%
70%
66%
60% 50% 40%
43%
43%
44%
45%
46%
7%
8%
9%
11%
11%
30% 20% 10% 0%
2015
2016
2017
SOURCES: FCC, NTIA AND EC’S DESI DATA
US: 2 or more Fixed Providers | EU: A Cable and Telco Provider
8
94%
US VS . EU BROADBAND TRENDS 2012 – 201 9
2018
2019
US VS. EU BROADBAND ADOPTION » Take-Up
SHARE OF HOUSEHOLDS WITH FIXED BROADBAND SUBSCRIPTION AT ANY SPEED EU
US
KEY TAKEAWAYS Not only do more Americans have access to highspeed broadband, but significantly more Americans also have adopted the service in their homes.
100%
80%
77%
2018
71%
78%
2017
68%
74%
75%
2015
40%
77%
76%
2014
72%
75%
82%
2016
79%
60%
84%
82%
79%
20%
2019
2013
2012
0%
SOURCES: FCC, NTIA AND EC’S DESI DATA
9
US VS. EU BROADBAND ADOPTION » Take-Up
SHARE OF HOUSEHOLDS WITH FIXED BROADBAND SUBSCRIPTION ≥ 30 MBPS KEY TAKEAWAYS Like deployment, the U.S. adoption advantage grows at higher speeds—with U.S. consumer takeup rates nearly 10 percentage points ahead of EU consumers.
EU
US
80% 70%
63% 57%
60%
50%
50%
44%
40%
35%
30%
26%
20% 15% 10%
48%
53%
40% 34%
26% 21%
10%
SOURCES: FCC, NTIA AND EC’S DESI DATA
10
US VS . EU BROADBAND TRENDS 2012 – 201 9
2018
2017
2016
2015
2014
2013
2012
0%
US VS. EU BROADBAND ADOPTION » Take-Up
SHARE OF HOUSEHOLDS WITH FIXED BROADBAND SUBSCRIPTION ≥ 100 MBPS EU
US
KEY TAKEAWAYS
50%
At the fastest speeds, the U.S. has a 20+ percentage point lead on broadband adoption.
47%
40%
33%
20%
14% 9%
26%
23%
18%
13%
2017
2016
8% 2015
.1% 2012
0%
.5%
2014
3%
5%
2013
10%
26%
2019
20%
2018
30%
SOURCES: FCC, NTIA AND EC’S DESI DATA
11
US VS. EU BROADBAND ADOPTION » Take-Up
SHARE OF HOUSEHOLDS WITH BROADBAND SUBSCRIPTIONS AT 3 SPEED INTERVALS < 25 MBPS
≥ 25 MBPS & < 100 MBPS
≥ 100 MBPS
KEY TAKEAWAYS More American consumers are adopting broadband overall, and far more are choosing higher-speed service offerings than EU consumers.
0%
US VS . EU BROADBAND TRENDS 2012 – 201 9
2018
0%
2017
15%
2016
15%
2015
30%
2014
30%
2013
45%
2018
45%
2017
60%
2016
60%
2015
75%
2014
75%
2013
90%
2012
90%
SOURCES: FCC, NTIA AND EC’S DESI DATA
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EU
2012
US
WHY IS THE US AHEAD?
WHY IS THE U.S. AHEAD? TELECOM INFRASTRUCTURE INVESTMENT 2012 – 2018 EU
US
KEY TAKEAWAYS
INVESTMENT
CUSTOMER BASE
2012-2018 CUM
AVERAGE HOUSEHOLD
PER HOUSEHOLD
AVG ANNUAL INVESTMENT
U.S. $708
U.S. $4,955
U.S. $616B
EU $353B EU 219M
U.S. 124M
EU $1,610
Broadband companies invest far more in the U.S. as a whole… U.S. +75% (CUM) …Despite a far smaller customer base
EU $230
U.S. -43% (# of households vs. EU) …and per household U.S. +208% (CUM) …every year
SOURCES: FCC, NTIA AND EC’S DESI DATA
U.S. +$478/household (Avg Annual Investment)
Denominated in 2018 U.S. dollars. All figures are 2012-2018 CUM. Investment figures include residential, business and mobile services.
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