Lisa Minter (lisa_minter2001@yahoo.com) Thu, 7 Jul 2005 15:23:45 -0500

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The number of U.S. consumers and businesses that subscribe to high-speed Internet service, or broadband, jumped 34 percent in 2004 to almost 38 million lines, according to new statistics released on Thursday. The United States lags 15 other countries in broadband coverage, according to international statistics, but U.S. officials stressed that some countries subsidize deployment and are more densely populated in smaller areas. Approximately 5.4 million subscribers were added during the second half of 2004, according to a new Federal Communications Commission report. The agency had previously reported adding 4.3 million broadband lines in the first half of the year. More consumers picked high-speed Internet from cable companies last year than broadband from local telephone companies, known as digital subscriber line service (DSL), according to the FCC report. Cable companies added about 5 million customers during the year, a 30 percent increase to 21.4 million lines, while the number of DSL subscribers climbed about 45 percent, or 4.3 million lines, to 13.8 million lines. Cable and telephone companies are engaged in a fierce battle to offer customers a suite of communications services. DSL is less expensive than cable Internet service but offers slower download speeds. Broadband is becoming more widely used as consumers want faster access to the Internet for research, shopping, watching movies and downloading music. President Bush pledged during his 2004 re-election bid to ensure there would be universal access to broadband by 2007. FCC Chairman Kevin Martin has made eliminating regulatory hurdles to achieve that goal his top priority since taking the reins of the agency earlier this year. "The dramatic growth in broadband services depicted in this report proves that we are well on our way to accomplishing the president's goal of universal, affordable access to broadband by 2007," Martin said in an opinion piece published on Thursday in The Wall Street Journal. He said the FCC should ease some old regulations on telephone companies to put them on the same footing as cable operators, but added that the government would not relinquish its role of protecting consumers and aiding law enforcement. "This means that we must treat all such providers in the same manner -- free of undue regulation that can stifle infrastructure investment," he said. But one consumer advocate criticized FCC policies as harming competition for broadband. "Competitive Internet service providers are now history; the U.S. has a duopoly -- cable and telephone industry -- over broadband," said Jeff Chester, executive director of the Center for Digital Democracy. "Both cable and telephone have a long history of anti-competitive behavior." Copyright 2005 Reuters Limited.

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