Just 6 percent of broadband households in the US are using gigabit Internet speeds and interest in upgrading to fiber optic broadband is actually declining as consumers grow more concerned about costs, according to a new survey. But interest worldwide is increasing.
Availability of gigabit Internet from providers is increasing and the number of customers is forecast to grow at 17 percent a year through 2023, according to research firm Parks Associates.
However, even at that rate Parks says there will be only 13 million US subscribers in five years.
Worldwide, Parks is forecasting some 1 billion gigabit Internet users by 2023 with almost have of those households located in the Asia Pacific.
Why less interest in the US?
“Interest in gigabit speeds has declined, due partly to limited availability, but also as households prioritize cost over speed,” said Craig Leslie, Senior Research Analyst at Parks Associates. “Of the US broadband households that switched services in the past year, 50% did so to get a better price, while 36% switched to get better speeds. Households are not seeing the benefits to speed upgrades, especially as providers have conditioned households to differentiate based on pricing.”
There certainly is room for growth.
Some 22 percent of broadband households in the US have access of between 100 and 999 mbps, according to Parks.
Providers are thus looking at gigabit capability as a retention tool, Parks says.
“Consumers are failing to see a compelling need for gigabit services, as few households require the performance levels of these services, so providers respond by positioning gigabit services as a premium service and part of gigabit-backed bundles that feature broadband, pay-TV, OTT services, and fixed phone components to appeal to the widest audiences,” the firm reports.