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Monday, July 19, 2010

Electrification and Soviet Power Part II - or why we're all the same?

Dave Burstein crunches the new OECD figures - which show that most of the G7 has 25-30% broadband despite huge differences between cable market shares (e.g. DSL market share 13% Canada, 11% US, 16% Belgium and 29% France). So if we're all the same, what's all the argument about?
Well, first its about catch-up - most of those countries with very little cable have achieved remarkable competition on the DSL line up to now. Most cable countries have not done much on DSL competition. Italy and Spain lag far behind at 21% but did not start the race until years later. So whereas Germany, US and Canada were the only players in the game in the late 1990s, within 10 years the UK and France have got ahead. The even better examples are countries with cable and competition in DSL - the Far East, Scandinavia, Netherlands, where penetration is much higher. And one other thing...
Competition brings speed. Cable can achieve 50-100 Mbps faster and cheaper than DSL can roll out VDSL. But then another leapfrog can occur where DSL is upgraded to FTTP - as in Japan, and we soon have Gigabit Ethernet. Is this moving from battery power to AC electrical grids, or something much less important? Cloud enthusiasts say the former, copyright holders the latter, and the truth will, as Mao said, not be known for several hundred years. But would you move backwards in speed in your workplace or university environment? Thought not.
You might get some answers at the 38th Telecoms Policy Research Conference panel on broadband strategies 1-3 October. Try this session with Eli Noam and Rob Frieden in particular, plus this EU-Korea-Japan discussion - and say hi for me, its the first I have to miss for a few years (honeymoon calls).

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