Dial-up holdouts ask: Why go to broadband?
Holdouts don't see the need for broadband
12:00 AM CDT on Tuesday, September 4, 2007
By ANDREW D. SMITH / The Dallas Morning News
Some announce their position and explain why it's smart. Others blush
when relatives mockingly raise the topic. But neither type expects to
upgrade from dial-up to broadband Internet - ever.
Analysts who monitor such holdouts closer than investors monitor Ben
Bernanke say most dial-up users are kidding themselves. Broadband
Internet has spread faster than did telephones, radio or television,
and it will eventually become as common as any of them.
Pundits, meanwhile, ponder whether holdouts hurt the national economy
and debate what our impatience with dial-up says about us.
"Nearly 75 years elapsed between the invention of the telephone and
anything approaching universal adoption. Broadband Internet has
reached half the nation's homes in less than a decade," said Jim
Murphy, AT&T Corp.'s executive director for retail DSL.
"If you keep this history in mind, it's really not surprising that we
still have holdouts. It's only surprising that so many of us are
I'm not surprised, though, because I've lived it - my father-in-law
was a holdout until a few months ago.
AT&T research reveals much about holdouts, some expected, some
Holdout demographics do, of course, skew older and lower-income. Many
holdouts retired before fast Internet hit offices. Working holdouts
rarely use the Internet in the office.
In these days of $10 dial-up and $15 DSL, the actual costs rarely
prevent upgrades. In fact, people with a second phone line for dial-up
Internet can actually save by switching.
But some holdouts don't know that broadband is so cheap because they
never bother to investigate.
Others know they can afford to upgrade but don't see the need. This
group rarely goes online and sticks mostly to e-mail. And some members
of the club take pride in denying themselves anything as frivolous as
"I just don't need it." "I don't mind waiting a couple seconds for a
page to load up." "How fast does it need to be?"
I heard all these explanations from my father-in-law, generally
accompanied by dismissive hand gestures. The battle only ended when
his son bought him DSL last Christmas.
"Children are broadband's greatest friend," said Sandra Carpenter,
Verizon Communications Inc.'s group manager of marketing for the Texas
About 56 million U.S. homes subscribe to some sort of fast Internet,
and 21 million have dial-up.
Broadband enthusiasts use it so much that they often think it's been
around longer than it has.
Colleges and corporations got fast Internet in the 1990s, but
consumers had to wait. According to the Organization for Economic
Cooperation and Development, only 5 percent of Americans had fast
Internet in 2001 and just 15 percent had it in 2005.
These figures are strangely controversial; other sources put them far
higher, but you can see how new Internet ubiquity is by considering
where you got your news on Sept. 11 or even during Hurricane Katrina.
Only a few of you turned instantly to the Internet because only a few
of you had the sort of connection that makes the Internet an instant
source of news.
The explosive growth of fast Internet began in the middle of this
decade, when price drops and speed boosts began attracting more than 2
million households per quarter.
The conversion rate may be slowing. Broadband service providers added
only 1.2 million accounts during the three months ended June 30. That
said, second-quarter numbers are always weak, and half of the nation's
holdouts may have broadband by this time next year.
"We expect that 73 percent of all homes will have a broadband
connection by 2011," said Amanda Sabia, an analyst at Gartner
Research. "Most of the others won't be dial-up customers. They'll be
people who don't even own a computer."
Not for everyone
Analysts doubt we'll ever get to universal broadband. Some people just
aren't interested in the Internet; others will never learn to use it.
And roughly one in five Americans struggles to read well enough for
basic Internet use.
Such limitations will probably hold the U.S. far behind tech leaders
such as South Korea, which already boasts that 89 percent of its
households have fast connections. Eight other nations and territories
report broadband penetration above 67 percent.
Some say this puts the U.S. at a competitive disadvantage.
"It's not just the number of people with broadband but the sheer speed
of the broadband they have," said Andrew King, president of the
consulting firm Web Site Optimization.
"Some people question why anyone needs anything more than 2 or 3
megabits, but there are many possible uses. It would be a very big
deal if South Korean businesses could slash travel costs - or even
office costs - because their networks support high-definition video
conferencing for salespeople and telecommuters."
Others worry far less.
"Logic says broadband should spur economic development, but when you
crunch all the available data, you get underwhelming results," said
Robert Crandall, a senior fellow at the Brookings Institution, a
Washington think tank.
"They show that broadband boosts employment slightly, but it's a minor
effect compared to factors like education."
Despite the long odds, big corporations appear determined to sell fast
Internet to every American.
Internet sellers advertise on television, over the radio and in print.
They set up booths at fairs. They send information through the mail.
They even go door to door.
"All we really have to do is get someone to give broadband a try,"
said Bill Kula, a Verizon spokesman. "Practically no one ever drops
broadband Internet and goes back to dial-up. I'm not sure I've ever
heard of anyone doing that."
Such assertions certainly match my experience. Less than six months
after getting basic DSL, my father-in-law upgraded his service again.
"I can't believe I waited as long as I did," he said. Then he
explained why he had no "need" for high-definition television.