Michael Feinberg knew he was ready to buy into broadband when
navigating the Internet began to seem more like slogging than
In the course of researching law cases, or downloading music
files, the Chicago law student's dial-up Internet service through
America Online began consistently to disconnect.
Mr. Feinberg soon found a high-speed antidote. His new modem,
acquired from the local cable company, boosted the speed of his
Internet service by a factor of 10.
He was able to access the Web immediately, and could talk on the
phone while working online. For Feinberg, the service has become an
at-home necessity. "I don't have to deal with the hassle of having
to load each page every time I need a law case," he says.
Faster Internet service is the main engine driving Americans'
relatively quick adoption of broadband, the high-speed transmission
of text, audio, and video, normally through cable or telephone
lines. More than 15 million households now subscribe to a broadband
service - up from 9 million just a year ago and 3.5 million in 2000,
according to ARS, a market-research firm in La Jolla, Calif.
Most dial-up web users (about 50 million US households) have
waited to update their service because of concerns about price. Yet
many holdouts are beginning to switch, spurred by new plans that
bundle broadband with other services or offer lower prices for
different levels of Internet service.
Despite the availability of broadband services that are now
priced at less than $25 a month, providers suspect many interested
consumers may wait a few years to upgrade.
Millions of potential customers, experts say, have been turned
off by broadband over the past three years after discovering that
the service was not available where they lived or was too much of a
hassle to install.
Some may also have been confused about differences between
broadband's two primary means of distribution: cable and digital-
subscriber lines (DSL).
Providers, experts say, now must give people reasons to take a
"It was frustrating for consumers from the beginning," says Ernie
Berckstrom, an analyst with market research firm In-Stat/MDR of
Scottsdale, Ariz. "The marketing was out in front of what was
actually being offered."
Americans' thirst for broadband soared during the late 1990s. But
only a fraction of consumers ultimately received service. The
problem: Providers could not meet demand.
Cable companies, which often offer both high-speed Internet and
digital cable television, often overpromised, experts say. Local
telephone companies, which provide high-speed Internet on DSL, did
Consumer interest has recently been reignited because both cable
and telephone companies have beefed up their networks to hold more
data and reach more customers. "The telcos have gotten their act
together," says Mr. Berckstrom.
Telephone companies in particular are more aware of the
limitations of their service - speeds slow further away from the
companies' central offices. The time to set up service has been cut
from about a month, in some cases, to about five business days for
both cable and DSL.
Though coverage gaps still exist in suburbia and rural America,
about 75 percent of American households can now receive broadband in
Consumers adoption of broadband no longer hinges on technological
capacity. "The market has reached the point where it's no longer an
issue of supply, but demand," says Mark Kersey, a broadband analyst
The pull of new pricing
Most consumers first look at cost when considering whether to
switch to broadband.
Broadband providers have traditionally offered a flat fee for one
service plan. But many are beginning to show more flexibility with
Covad, a Santa Clara, Calif. …