Doubtful US Consumers Are Cutting Out Fixed Broadband

The NTIA‘s recent study on Internet Use* indicates that a growing number of Americans’ are substituting their fixed broadband connection with a mobile-only broadband connection.

According to the study 75% of  American households access the Internet at home via a wired technology, down from 82% in 2013; while the number of households that rely exclusively on a mobile Internet service doubled from 10% to 20%.

Source:  NTIA

This data seems to contradict the growth in fixed broadband connections in the US, which stood at nearly 104 million at the end of 2015 or almost 86% penetration of households – with steady year over year growth.

So can this really be true?

According to the questionnaire for this study – consumers were asked how they connected to the Internet at home:

1. (1) Mobile Internet service or a data plan for a cellular phone, smartphone, tablet, laptop, or other device? (If needed) This type of Internet service is provided by a wireless carrier, and may be part of a package that also includes voice calls from a cellular phone or smartphone.

2.  (2) High-speed Internet service installed at home, such as cable, DSL, or fiberoptic service? (If needed) This type of Internet service is often provided by a cable company or phone company.

3. (3) Satellite Internet service?

4. (4) Dial-up service?

5. (5) Some other service?

In addition, if the respondent replied Wi-Fi – they were asked ” Do you know what kind of Internet service is connected to the Wi-Fi in your household?”

However, in perusing the data, I could not see how this was answered by the participants.

While I agree that the number of people accessing the Internet via a mobile device is rapidly growing – this is an indisputable trend – I disagree that we are seeing accelerating substitution of fixed broadband for mobile broadband.

In my opinion – the average consumer does not seem to realize (nor care) that their Wi-Fi network has a fixed broadband connection at its heart.  Is it  possible that they are confusing Wi-Fi for mobile connectivity?  Absolutely.

With demand for streaming services rapidly on the increase and the amount of content streamed growing exponentially – most consumers could not afford to rely solely on their mobile Internet plans.  Additionally, the growth in these services is being driven directly by increasing speeds available on fixed broadband networks.

Per the most recent FCC report on Internet Access Services (December 31, 2014, published March 2016) nearly 73% of fixed broadband subscribers have at least 25Mbps downstream, while nearly 45% of those are 25Mbps or greater.  In contrast, 58% of mobile broadband subscribers get between 3-6Mbps, while 23% are greater than 6Mbps – but most likely below 25Mbps.

Although I could see some possibility of substitution, no US operator has commented that this appears to be occurring.  And given the fact that we are seeing strong investment by operators into their fixed broadband networks – supports the fact that this trend has had limited impact.

Perhaps when 5G is a reality and broadband connectivity is ubiquitous this will ring true, but for now it simply just a great attention grabbing headlines.

*The  data for this study comes from the Computer and Internet Use Supplement to the Current Population Survey (CPS), which included nearly 53,000 households and was conducted for NTIA by the U.S. Census Bureau in July 2015. The large sample size provides a detailed picture of where, why and how Americans go online.