It seems hardly a week goes by without somebody sounding the alarm bell on the “crisis” in US broadband deployment. While we all share the common goal of bringing affordable broadband service to all Americans, it’s unfortunate that the most frequently cited source of broadband deployment – the semi-annual Organization for Economic Cooperation and Development (OECD) numbers – contains a variety of inaccuracies.

So, to help set the record straight, this week we thought we would take a look at the OECD broadband study and the real state of broadband today.  In our first two installments, we’ll examine flaws in several units of measurement utilized in the OECD study.  We’ll then move on to fact check the “miracle” of Japanese Broadband and finish by analyzing why consumers aren’t connecting to services that are already available.  

It depends on what your definition of a subscription is.

The most significant flaw in OECD’s methodology is their measurement unit of subscriptions per 100 inhabitants.  Average household size plays havoc with the “inhabitants” calculation, creating some serious unintended consequences.  We’ll cover that in tomorrow’s post.

Equally problematic, however, is what they do and do not consider to be a subscription.  In OECD’s definition of what constitutes a “broadband subscription,” there is no distinction drawn between business DSL or cable lines and residential DSL or cable lines, but there is a specific exclusion of direct fiber and T1 lines for businesses.  As a result, some businesses are counted and others are not.

OECD’s data fails to capture the tens of millions of U.S. workers that access the Internet via these special access connections.

The OECD measure also fails to count the approximately 16 million college students in the U.S., most of whom have access to both wired and wireless High-Speed Internet (HSI) service.   Also uncounted are the HSI users that access WiFi connections, and the growing number of mobile wireless and “Hot Spot” customers.

Undercounting these populations negatively impacts the US ranking, but counting them would be problematic as well.  Because so many people have broadband access at home, at work, via their mobile device, at college, or through some other connection, the risk of double or triple counting becomes fairly great.

Some have suggested that a better metric would be to simply measure the number of residential households that are subscribed.  The distinction is really very stark.  For instance, in the US, roughly 57 million households subscribe to cable, DSL, fiber, satellite, or fixed wireless service.  Using a measurement of how many “residences” have access would more accurately reflect the real state of residential broadband consumption, and would vault the U.S. ahead of 9 European countries which were ranked higher in terms of household penetration in the OECD rankings of December 2006.  (Note: Household data is not available for Korea, Canada, and Australia, so it’s unclear where they would rank).