Story Author: Wire Report
Publish Date: Not Available
Source Publication: Reuters

WASHINGTON - The number of American consumers and businesses that subscribe to high-speed Internet service, or broadband, jumped 38 percent in the year ended June 30, 2004, according to new statistics released on Wednesday.

About 32.5 million broadband lines connected homes and businesses to the Internet, up from 23.5 million at the end of June 2003, the U.S. Federal Communications Commission said in its semi-annual report of the latest statistics.

In the six months ended June 30, the number of broadband lines rose 15 percent while during the previous six months the number of lines rose 20 percent, the agency said.

Broadband is becoming more widely used as consumers want faster access to the Internet, for research, shopping, watching movies and downloading music. President Bush pledged during his 2004 re-election bid to ensure there would be universal access to broadband by 2007.

Even with the penetration rate increasing, the United States continues to fall behind other countries in the rankings for broadband subscribers, falling to 13th in the most recent rankings by the International Telecommunications Union.

The FCC has argued that many Americans have broadband at work and thus are less likely to subscribe at home. Further, agency officials have said that some countries higher in the rankings have subsidized deployment and are more densely populated.

Consumers subscribing to broadband via digital subscriber lines, or DSL, typically provided by telephone companies, rose 3.7 million, or almost 49 percent, to 11.4 million lines in the year ended in June, the FCC said.

In comparison, the number of broadband lines via cable modems jumped 4.9 million to 18.6 million lines, up 36 percent year over year, according to the agency.

Separately, the FCC also said that about 32 million customers received their local telephone service from a company other than the major U.S. local telephone carriers in the year ended June 2004, up 19 percent over the previous year.

The FCC last week relaxed rules that had required the dominant local telephone carriers to lease parts of their networks to competitors at steep discounts so they could offer their own residential local telephone services.

In anticipation of the rule changes, one big competitor, AT&T Corp., has stopped marketing its local and long-distance residential service via traditional telephone lines and is now focusing on offering service via broadband.