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Economic Situation Will Hamper Broadband Adoption, Report Finds

But government initiatives might help service providers bolster their customer counts

The pace of broadband signup will slow this year, according to research company Pike & Fischer.

It said approximately 5.7 million U.S. households will become new high-speed Internet customers, a 12% decline in subscriber growth from 2008.

Still, the total number of broadband-connected homes will reach about 74.5 million by the end of the year, or 63 percent of U.S. households, it found. The cable industry will capture about 75 percent of new broadband subscribers, the company believes.

“While top telephone companies such as Verizon and AT&T are providing new fiber-optic Internet services that can exceed the speeds offered by cable, most of their service areas are covered only by DSL service, which consumers are increasingly spurning because its speeds are slower than cable.”

It thinks the conomic crisis means consumers will spend less on communications services as job security becomes more tenuous and their discretionary income drops. “However, broadband customer growth could exceed forecasts if the incoming Obama administration succeeds in its plan to expand broadband availability as part of a major economic stimulus package,” it stated.