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Broadband Bringing Home the Bits
facilities fall into two categories: (1) existing facilities built by an incumbent telephone or cable company for the purpose of delivering voice or cable TV service and (2) new facilities—such as fiber optic cable, wireless, or satellite—constructed specifically for the purpose of delivering broadband. Before broadband, dial-up connections over the public telephone network were the dominant way in which homes were connected to the Internet or other online services. The performance of these modem connections has reached a plateau defined by the bandwidth of telephone circuit switches (more than 50 kilobits per second [kbps] under optimal conditions, but possibly less depending on factors such as line, interior wiring, and modem quality), and further improvements have required new technology approaches.
At present, two access technologies that leverage existing infrastructure—digital subscriber line (DSL) and hybrid fiber coax (HFC; or cable modem)—are maturing, as evidenced by wide availability, industry standards, multiple product vendors, volume pricing, and deployment experience; others—such as terrestrial wireless and fiber-to-the-home (FTTH) —are being developed and deployed on a smaller scale. The range of technology options captures part of what makes broadband vexing—fiber promises maximum bandwidth; wireless offers pervasiveness, flexibility, and potentially faster deployment; and satellite offers nationwide coverage (albeit with some gaps and limited total capacity). Today, DSL and HFC are most prominent, shape consumer experience, and fuel much of the politics that surrounds broadband. Looking forward, as other technologies such as fiber and wireless surmount cost and other deployment barriers and become more pervasive in residential broadband, providers, consumers, and policy makers alike will face new issues.
The committee’s work started in late 1999 and was completed in fall 2001, a period encompassing significant broadband deployment and both boom and bust in the telecommunications and Internet markets. Until recently, only universities and large businesses and organizations had high-speed Internet access, reflecting a favorable economic return on investment in providing service to these customers. In contrast, residences and small businesses (and smaller offices of larger organizations) have been less likely to attract investment. Also, many homes are relatively distant from neighboring homes or are connected today by hard-to-upgrade telecommunications infrastructure, and some are in remote locations—all factors that entail higher per-premises costs and inhibit deployment.
Following roughly a decade of development and experimentation, residential (and small business) broadband services have been available in selected markets for several years and more recently have become mass-market. Cable operators, incumbent local exchange carriers (ILECs),