July 24, 2015
Released July 24, 2015
U.S. broadband providers invested $78 billion in network infrastructure in 2014, according to a new USTelecom analysis of company capital expenditures data showing spending has continued its pattern of growth since falling to $64 billion per year in 2009 during the financial crisis.
U.S. broadband providers invested $78 billion in network infrastructure in 2014, according to a new USTelecom analysis of company capital expenditures data showing spending has continued its pattern of growth since falling to $64 billion per year in 2009 during the financial crisis. Broadband provider investment was up by $14 billion in 2014 compared to 2009, or 22 percent. Last year alone, annual investment grew by $3 billion, or 4 percent, after surging to $75 billion in 2013. Furthermore, broadband providers have made $1.4 trillion in capital investments from 1996 through 2014 (see Chart 1, U.S. Broadband Provider Capital Expenditures, 1996-2014). This release updates the data series USTelecom published last year.
Through 2014 the industry continued to make significant investments in expanded broadband capability to the benefit of American consumers. Today, nearly all Americans have a choice of multiple broadband providers. According the data from the National Broadband Map, more than 96 percent of Americans now have access to fixed broadband and 88 percent of households can choose from two or more fixed providers. More than 99 percent of Americans can get mobile broadband and 97 percent can choose among three or more mobile providers. Additionally, broadband investment has resulted in ongoing upgrades and allowed providers to offer consumers ever-increasing speeds. As of mid of 2014, 99 percent of Americans could get broadband at 10 Megabits per second (Mbps) download or greater, up from 84 in mid-2010. Mobile broadband at 10 Mbps or greater was available to 98 percent of Americans, up from only 1 percent in 2010. Meanwhile fixed broadband at 50 Mbps download or greater was available to 83 percent of Americans, up from 46 percent in 2010, and 100 mbps download or greater was available to 65 percent of Americans, up from only 11 percent in 2010.
Ongoing investment in expanded broadband capacity is essential to building the communications infrastructure of the future, characterized by an accelerated transition to fiber-based networks and Internet Protocol (IP), user mobility, and greater reliance on cloud-based service delivery. It enables rapid growth in Internet usage and the development of innovative network technologies and services. The new modes of communication, entertainment, information retrieval, and online commerce that we have seen are just the beginning. Innovative services based on the emerging Internet of Things and data analytics are gaining traction across the economy, and they will be utilized to their benefit in ways both foreseen and unpredictable. Thus, broadband investment can bolster U.S. international leadership in information technology, which in turn can enhance consumer welfare, productivity, and standards of living. Policies that divert resources to legacy networks, and the recent policy shift to regulate broadband providers as utilities under Title II of the Communications Act, put pressure on broadband investment via economic constraints and policy uncertainty. While the impact is hard to measure, since we do not know what investment would be absent the policy shift, it puts at risk the magnitude of and pace at which we realize these benefits over time.