This week, we’re taking a close look at the issues with the OECD broadband rankings that are often cited when the state of broadband availability in the U.S. is discussed.  We started with a look at the problems and inconsistencies with what OECD does and does not consider a subscription – a flaw that excludes millions of US citizens from being counted.

Today, we’re looking at a the basic unit of measurement in their study – subscriptions per 100 inhabitants.  To understand this issue, you have to begin with a simple question.

What happens when everyone reaches 100%?

All metrics should be equal.  No matter how you count it, when every nation reaches 100% broadband adoption, we’re all tied for first, right?  Actually, no.  This is an odd little side effect of the OECD’s reliance on “subscriptions per 100 inhabitants”.

If every country achieved 100% broadband access, there would still be clear winners and losers.  The OECD rankings would still produce disparate rankings because of the impact of calculating results this way.  In fact, a Phoenix Center study examined this specific problem.  By applying the ranking methodology to what it calls “Broadband Nirvana”, the study found that the United States would actually rank 20th - 5 places lower than where we are today - if every household and every business in every country had a connection.

By measuring total (primarily household) subscriptions per units of 100 inhabitants, the OECD fails to account for disparities in average household sizes throughout the world.  Those countries with fewer average residents per household (many of the northern European countries at the top of the OECD listing) will rank higher in the OECD statistics, yet the irony is that there are fewer residents in each of these homes who are able to take advantage of the HSI service.

Think of it this way.  If average household size is Denmark is 2.1 people, and you measure subscriptions per 100 inhabitants, you would have 48 subscriptions per 100 inhabitants.  One hundred subscriptions would cover 210 people.  In the US average household size is roughly 2.6 persons per household.  100 subscriptions cover 260 people.  However, based on the OECD methodology, you have only 38 subscriptions per 100 people.  The US ranking is much lower despite having roughly 20% more people with access. 

Because of that skew, the US, with more people accessing broadband through the same number of subscriptions, actually fares worse in the OECD outcome.  It’s a serious flaw.

That’s not to say that a serious discussion about ways to increase broadband adoption shouldn’t take place.  Tomorrow, we’ll take a look at Japanese broadband. Our final installment in this series will focus on some of the reasons people don’t adopt broadband and efforts to change that.

Tags: broadband rankings, OECD broadband

This entry was posted on Thursday, February 7th, 2008 at 4:47 pm and is filed under Broadband, Tech Discussions. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.