Tag Archives: OpenVault

FCC Considers New Definition of Broadband

On November 1, the FCC released a Notice of Inquiry that asks about various topics related to broadband deployment. One of the first questions asked is if the definition of broadband should be increased to 100/20 Mbps. I’ve written about this topic so many times over the years that writing this blog almost feels like déjà vu. Suffice it to say that the current FCC with a newly installed fifth Commissioner finally wants to increase the definition of broadband to 100/20 Mbps.

The NOI asks if that definition is sufficient for the way people use broadband today. Of most interest to me is the discussion of the proposed 20 Mbps definition of upload speed. Anybody who follows the industry knows that the use of 20 Mbps to define upload speeds is a political compromise that is not based upon anything other than extreme lobbying by the cable industry to not set the number higher. The NOI cites studies that say that 20 Mbps is not sufficient for households with multiple broadband users, yet the FCC still proposes to set the definition at 20 Mbps.

There are some other interesting questions being asked by the NOI. The FCC asks if it should rely on its new BDC broadband maps to assess the state of broadband – as if they have an option. The answer to anybody who digs deep into the mapping data is a resounding no, since there are still huge numbers of locations where speeds claimed in the FCC mapping are a lot higher than what is being delivered. The decision by the FCC to allow ISPs to report marketing speeds doomed the maps to be an ISP marketing tool rather than any accurate way to measure broadband deployment. It’s not hard to predict a time in a few years when huge numbers of people start complaining about being missed by the BEAD grants because of the inaccurate maps. But the FCC has little choice but to stick with the maps it has heavily invested it.

The NOI asks if the FCC should set a longer-term goal for future broadband speeds, like 1 Gbps/500 Mbps. This ignores the more relevant question about the next change in definition that should come after 100/20 Mbps. According to OpenVault, over 80% of U.S. homes already subscribe to download speeds of 200 Mbps or faster, and that suggests that 100 Mbps download is already behind the market. The NOI should be discussing when the definition ought to be increased to 200 or 300 Mbps download instead of a theoretical future definition change.

Setting a future theoretical speed goal is a feel-good exercise to make it sound like FCC policy will somehow influence the forward march of technology upgrades. This is exactly the sort of thing that talking-head policy folks do when they create 5-year and 10-year broadband plans. But I find it impossible to contemplate that the FCC will change the definition of broadband to gigabit speeds in the next decade, because doing so would be saying that every home that doesn’t have a gigabit option would not have broadband. Without that possibility, setting a high target goal is largely meaningless.

The NOI also asks if the FCC should somehow consider latency and packet loss – and the answer is that of course they should. However, they can’t completely punt on the issue like they do today when FCC grants and subsidies only require a latency under 100 milliseconds and set no standards for packet loss. Setting latency requirements that everybody except high-orbit satellites can easily meet is like having no standard at all.

Of interest to rural folks is a long discussion in the NOI about raising the definition of cellular broadband from today’s paltry 5/1 Mbps. Mobile speeds in most cities have download speeds today greater than 150 Mbps, often faster. The NOI suggests that a definition of mobile broadband ought to be something like 35/3 Mbps – something that is far slower than what a urban folks can already receive. But talking about a definition of mobile broadband ignores that any definition of mobile broadband is meaningless in the huge areas of the country where there is practically no mobile broadband coverage.

One of the questions I find most annoying asks if the FCC should measure broadband success by the number of ISPs available at a given location. This is the area where the FCC broadband maps are the most deficient. I wrote a recent blog that highlighted that seven or eight of the ten ISPs that claim coverage at my house aren’t real broadband options. Absolutely nobody is analyzing or challenging the maps for ISPs in cities that claim coverage that is either slower than claimed or doesn’t exist. But it’s good policy fodder for the FCC to claim that many folks in cities have a dozen broadband options. If it were only so.

Probably the most important question asked in the NOI is what the FCC should do about the millions of homes that can’t afford broadband. The FCC asks if it should adopt a universal service goal. This question has activated the lobbyists of the big ISPs who are shouting that the NOI is proof that the FCC wants to regulate and lower broadband rates. The big ISPs don’t even want the FCC to compile and publish data that compares broadband penetration rates to demographic data and household incomes. This NOI is probably not the right forum to ask that question – but solving the affordability gap affects far more households than the rural availability gap.

I think it’s a foregone conclusion that the FCC will use the NOI to adopt 100/20 Mbps as the definition of broadband. After all, the FCC is playing catchup to Congress, which essentially reset the definition of broadband to 100/20 Mbps two years ago in the BEAD grant legislation. The bigger question is if the FCC will do anything meaningful with the other questions asked in the NOI.

The Growth of Upload Usage

I’ve written a number of blogs about the growth of download broadband usage. I recently looked at the growth trend for upload broadband usage and found that upload usage has been growing faster than download usage.

The statistics in the following table come from OpenVault, which has been tracking broadband usage statistics each quarter. The numbers represent the national average monthly usage of broadband for households at the end of the second quarter of each year until before the pandemic. Just like with download usage, there was a big burst in upload usage at the onset of the pandemic as people were sent home. People instantly needed upload links to communicate back to the office or the school. But even since the pandemic, the overall trend shows upload usage growing faster overall than download usage.

Upload Annual Download Annual
Mbps Growth Mbps Growth
2Q 2019 15 265
2Q 2020 23 56% 357 35%
2Q 2021 28 22% 405 13%
2Q 2022 31 11% 460 14%
2Q 2023 36 15% 498 8%

There are a lot of possible explanations for the growth of upload usage:

  • The pandemic trained the whole country to communicate by video conference. This has grown to become a routine practice. I use video conferencing at least a few hours per day, and often a lot more.
  • Over the last five years, a lot of the routine software we use migrated to the cloud. As a common example, Microsoft Office 365 has migrated the Microsoft suite of products to store and save in the cloud. Opening or modifying spreadsheets, Word Documents, or PowerPoints now uses upload bandwidth.
  • There is also widespread use today of collaboration software where multiple people can work on documents, spreadsheets, and graphics at the same time.
  • It’s hard to imagine anybody with a lot of files that doesn’t back them up in Dropbox or the many other storage systems.
  • There is a lot of hidden machine-to-machine traffic where software automatically and routinely connects to the outside world. A few years ago, a Washington Post reporter left his computer running during a month-long vacation and found that his home had generated almost a gigabyte of upload traffic in his absence.
  • It’s now a video-driven world, and people share videos as easily as we used to share pictures.
  • A major portion of gaming has moved to the cloud.
  • We are using a lot more security cameras. There has been a proliferation of doorbell cameras installed as well as inside cameras to check on pets, kids, and babysitters. People routinely check the cameras remotely.

It seems unlikely that upload usage will ever catch up to download usage for most homes. Most people consume more video and other content than they generate. But the volume of average upload usage is still significant. I doubt that anybody a decade ago would have predicted that the average U.S. home would be uploading 36 gigabytes each month.

There doesn’t seem to be any reason on the horizon why the growth won’t continue. More people are sharing videos and other content. We’re slowly creeping towards having early versions of telepresence and virtual reality, which will likely mean a huge bump up in upload usage for many homes. Does anybody care to make a prediction of the average amount of upload usage a decade from now?

Broadband Speed 2Q 2023

OpenVault just published its Broadband Insights Report for the end of the second quarter of 2023. As usual, OpenVault is documenting the continued growth in broadband usage by U.S. households.

I think one of the most useful statistics from OpenVault is the average household usage of broadband in gigabytes. Below is the trend in average U.S. household broadband usage since 2019. These numbers include combined download and upload usage.

Monthly
Gigabytes
2nd Quarter 2019 280.0
2nd Quarter 2020 380.2
2nd Quarter 2021 433.5
2nd Quarter 2022 490.7
2nd Quarter 2023 533.8

The following graph shows the usage of household average broadband usage since the beginning of 2019. This chart shows the second quarter usage (measured at the end of June) is always the lowest quarter each year, with the highest usage at the end of the fourth quarter.

 

 

 

 

 

 

 

 

Anybody who predicted these levels of average household usage levels twenty years ago would have been laughed out of the industry. Twenty years ago, the cutting-edge broadband products were DSL and cable modems that delivered speeds of around 6 Mbps download and barely any upload. We’re now at a place where the average home uses over half a terabyte of data each month.

OpenVault classifies households that use more than 1 terabyte of data per month as power users. 15.6% of all U.S. homes are now in the power user category. The average usage for power user homes is 2.21 terabytes per month, which is almost six times higher than the average non-power user household. If you’re wondering how power users use so much data, the average power user consumes 500 gigabytes of data per month just for gaming and almost 300 gigabytes for social media.

As usual, the report is full of other interesting statistics:

  • Homes that are subscribed to the FCC’s ACP (Affordable Connectivity Plan) use more data than other homes. Homes where the ACP subsidy covers the entire broadband bill use 18% more data than non-ACP homes . Homes where part of the bill is covered by ACP use almost 41% more broadband than non-ACP homes.
  • The migration to faster broadband plans continues, and only 10.4% of all U.S. broadband subscribers are buying a plan with an advertised speed of less than 100 Mbps. 75% of U.S. homes now subscribe to download speeds of 200 Mbps or faster.
  • Upload usage continues to grow, and the average home now uploads 36.1 gigabytes of data per month – another number that was inconceivable even a decade ago.

New Broadband Trends

The latest Broadband Insights Report is out from OpenVault providing statistics on average broadband usage at the end of the first quarter of 2023. In looking over the latest statistics I’m starting to see some interesting trends.

The average household used 560.5 gigabytes of broadband per month by the end of the quarter. That is the combination of 524.8.2 gigabytes of download and 35.7 gigabytes of upload. I also looked back over past years, and I think a new trend of broadband growth is emerging. Consider the following simple tables based upon the average household usage at the end of the first quarter since 2019.

Gigabytes
1Q 2019 273.5
1Q 2020 402.5 147%
1Q 2021 461.7  15%
1Q 2022 513.8  11%
1Q 2023 560.5  9%

2020 growth was crazy due to the pandemic, and that level of growth is likely never going to be seen again absent some other similar catastrophic event. Since then, growth has slowed a bit year after year. We’re settling into a pattern where the average household is using approximately 50 gigabytes more per month than the year before.

This is easy to understand. More and more things we are moving online. We’re storing more pictures and files each year. We’re watching more videos, and those videos are growing more data intensive as we migrate to 4K video. Most of the software we use is now in the cloud. The devices in our house are often connected to the cloud.

This is starting to feel like a new trend. We used to have a paradigm that broadband usage doubled every 3-4 years. Once we’ve moved most of our data lives to the cloud, there is no longer the likelihood of explosive growth in household usage. I think more and more homes are settling into a mature stage of having moved to the cloud. The only thing that can upset this would be some new widely used data function that uses a lot more data, or another event similar to the pandemic.

The other trend is that people have wholeheartedly decided that they want faster broadband speeds. There are a lot of folks in the industry who will argue vehemently that households don’t need more than 25 Mbps – but it doesn’t matter what they think. Huge numbers of families believe they should have faster speeds and are upgrading. Consider the following table that compares the percentage of subscriptions to various speeds from the first quarter of 2021 and 2022.

 Subscribers

1Q 2022 1Q 2023
Under 50 Mbps 7.6% 4.7%
50 – 99 Mbps 6.3% 4.8%
100 – 199 Mbps 17.0% 9.3%
200 – 499 Mbps 49.7% 41.1%
500 – 999 Mbps 6.1% 22.0%
1 Gbps+ 13.4% 18.1%
200 Mbps + 69.2% 81.2%

The percentage of homes that are subscribed to 200 Mbps or faster has skyrocketed in one year from 69% of homes to 81% of homes. Some of this increase comes from ISPs arbitrarily increasing speeds for customers, but a lot of the growth comes from people deciding to upgrade. This is clearly now a major trend.

The day of talking about 100 Mbps being an acceptable broadband speed is now behind us when 81% of the homes in the country are subscribed to speeds at least double that. As usual, the politicians who wrote the rules for the BEAD and other federal grants are far behind the real-life curve. Grants that allow somebody to build a network that can deliver only 100 Mbps are investing in obsolete technology. By the time those grant networks are constructed, any new networks that deliver only 100 Mbps will be years behind the rest of the broadband in the country. Let’s hope that broadband offices pay attention to this trend and require technologies that are forward-looking rather than buried in the past before they are even constructed.

The Latest Stats on Broadband Usage

OpenVault released its Broadband Insights Report for 2Q22, which contains statistics about nationwide broadband usage at the end of the quarter. As usual, the OpenVault report is an invaluable peek into the national state of broadband.

The report shows that the average home used 491 gigabytes of data at the end of the second quarter. This is up by 13% of the 433 gigabytes used at the end of the second quarter of 2021. The second quarter usage, which represents June 30, is typically the lowest usage levels of the year due to schools being out of session and folks on vacation.

Upload bandwidth usage continues to grow and averaged 31.2 gigabytes per household, up from 28 gigabytes in 2021 and 13.6 gigabytes in 2018. Average upload speeds increased from 17 Mbps in 2021 to 23 Mbps in 2022.

The percentage of households that use more than 1-terabyte (1,000 gigabytes) of data each month continues to grow rapidly. OpenVault calls these power users. These are homes that will trigger data caps if they have an ISP that enforces them. At the end of the second quarter of 2022, 13.7% of homes are using more than a terabyte compared to 10.8% in 2021, an increase of over 26%. The percentage of homes using more than 2-terabytes increased from 1.5% in 2021 to 2.2% in 2022, an increase of 47%.

There has been a huge migration of folks subscribing to faster tiers of broadband. The most extraordinary statistic is that 14.2% of American homes now subscribe to gigabit service, up from 4.6% just two years ago.

Much of this shift, shown in the table below, is coming from cable companies that unilaterally increased speeds for customers, but many millions of customers have also upgraded to more expensive broadband tiers to get faster broadband. The following chart shows a remarkable trend since June 2020:

Subscriptions June 2020 June 2021 June 2022
Under 50 Mbps 18.4% 10.5% 5.7%
50 – 99 Mbps 20.4% 9.6% 8.5%
100 – 199 Mbps 37.8% 47.5% 10.1%
200 – 499 Mbps 13.5% 17.2% 55.4%
500 – 999 Mbps 5.0% 4.7% 6.0%
1 Gbps 4.9% 10.5% 14.2%

This chart, better than anything else I’ve seen, lays to rest the idea that the national definition of broadband ought to be 100 Mbps download. As of June of this year, 76% of U.S. households are subscribing to broadband plans of 200 Mbps or faster. The most popular tier is 200-400 Mbps, which makes sense since the big cable companies have migrated most broadband customers to speeds of 200 Mbps or 300 Mbps.

Interestingly, OpenVault says that ACP customers are using more broadband, at 654 gigabytes, than the average home. There are also 52% more power users among ACP subscribers using more than a terabyte of data than the overall population. OpenVault doesn’t speculate why this is so, but I would guess that part of the difference might be that homes getting broadband for the first time have a lot of streaming video from recent years to catch up on. I remember how much video my household watched when we first got Netflix – but over time, we went back to other activities.

Q1 Broadband Usage Still Robust

The OpenVault Insights Report for the first quarter of 2022 shows that broadband usage remains high. The company gathers broadband usage data through ISPs from millions of individual broadband users to compile these reports, making the results a lot more reliable than a typical small sample.

Average household broadband usage in March 2022 was measured at 514 gigabytes, staying over half a terabyte of data used for the average household. That’s a measure of the total combined upload and download usage for the average customer during a month. This is a drop from 536 gigabytes in the fourth quarter of 2021, but the first quarter has always shown seasonally lower usage than at the end of the previous year. Usage for the first quarter is up 11% from the 462 gigabytes in the first quarter of 2021. That’s a lower growth rate than the 20% growth rate we’ve come to expect – however, 2021 was not a normal year due to the extraordinary growth from the pandemic.

The OpenVault statistics continue to show a huge number of users that are consuming more than 1 terabyte of data per month. At the end of the first quarter, 14.6% of homes used more than 1 terabyte of data, including 2.4% who used over 2 terabytes. That’s a significant increase since the first quarter of 2021 when 10% of homes used more than 1 terabyte of data – a year-over-year growth rate of 46%.

One of the most interesting statistics reported by OpenVault is the migration of customers over time to faster broadband tiers. The following table shows the percentage of nationwide households subscribed to various broadband speed plans in 2020 and 2021.

June 2020 June 2021 Dec 2021 Mar 2022
Under 50 Mbps 18.4% 10.5% 9.4% 7.6%
50 – 99 Mbps 20.4% 9.6% 7.6% 6.3%
100 – 199 Mbps 37.8% 47.5% 36.9% 17.0%
200 – 499 Mbps 13.5% 17.2% 28.5% 49.7%
500 – 999 Mbps 5.0% 4.7% 5.5% 6.1%
1 Gbps 4.9% 10.5% 12.2% 13.4%

It’s important to note that the above chart shows the subscribed speed and not the actual speeds, which are often lower. The migration to faster speeds is being driven by two factors. One is the big cable companies unilaterally upgrading basic speeds to 200 Mbps. But many of the speed upgrades are customer driven, as can be seen by the big growth in customers subscribed to speeds faster than 500 Mbps.

The report also highlights something that network engineers have always understood, which is that big events cause big spikes in usage. I’ve understood this since the days since telephone company network engineers braced themselves for Mother’s Day. OpenVault looked at the usage in Kansas City during the NCAA March Madness basketball game between Kansas and Duke. The regional usage spiked 24% during the game compared to the previous three Mondays.

The report, as always, has a few other interesting tidbits:

  • Average North American usage is more than double the average broadband usage in Europe.
  • In 2017, less than 10% of homes used more than 500 gigabytes of data per month. That’s now up to 25% of homes.
  • Average household upload usage has grown from 25 gigabytes at the end of 2020 to 32.5 gigabits at the end of the first quarter of 2022. That’s a 30% increase in 15 months. Interestingly, subscribers with unlimited data plans use three times more upload bandwidth than other subscribers.
  • OpenVault reports average nationwide U.S. download speeds of 312 Mbps, and average upload speeds of 22.5 Mbps. However, they don’t define how that is calculated, so it’s hard to put that into context.

OpenVault’s conclusion from the latest data is that ISPs should expect the continued growth of customers who use more than a terabyte of data per month. They also note that there is a marketing opportunity for ISPs since customers seem willing to pay to upgrade to faster speeds.

Household Broadband Usage Up Again

OpenVault just published its Broadband Insights Report for the end of the fourth quarter of 2021. As usual, the results are astounding and demonstrate the continued strong growth of household broadband usage.

I think one of the most useful statistics from OpenVault is the average household usage of broadband. Below is the trend in average U.S. household broadband usage since 2018. These numbers include combined download and upload usage.

1st Quarter 2018          215 Gigabytes

1st Quarter 2019          274 Gigabytes

1st Quarter 2020          403 Gigabytes

1st Quarter 2021          462 Gigabytes

4th Quarter 2021         536 Gigabytes

There were not many people in the industry in 2018 who would have believed that the average home usage in 2021 would be using over a half terabyte of data each month.

Another startling number is the percentage of U.S. households that now use over a terabyte of data each month – something that OpenVault calls power users. The following statistics also reach back to 2018. OpenVault says that 2.7% of all U.S. households now use over two terabytes of data per month. These statistics must be sweet music to those ISPs with data caps that penalize home for using the broadband they’ve purchased.

4th Quarter 2018            4.0%

4th Quarter 2019            7.3%

4th Quarter 2020          14.1%

4th Quarter 2021         16.1%

I think that the most interesting statistic is the rapid migration of customers to faster broadband tiers. The following table shows the percentage of nationwide households subscribed to various broadband speed plans just since June 2020.

June 2020 June 2021 Sept 2021 Dec 2021
Under 50 Mbps 18.4% 10.5% 9.8% 9.4%
50 – 99 Mbps 20.4% 9.6% 8.0% 7.6%
100 – 199 Mbps 37.8% 47.5% 38.4% 36.9%
200 – 499 Mbps 13.5% 17.2% 27.4% 28.5%
500 – 999 Mbps 5.0% 4.7% 5.1% 5.5%
1 Gbps 4.9% 10.5% 11.4% 12.2%

In just the last year, the number of households subscribed to gigabit broadband is up 250%, while the number subscribed to slower speeds has dropped precipitously. Many millions of homes over the last year upgraded to faster broadband plans.

But a big part of this shift comes from a change in the definition of existing broadband plans. For example, several of the big cable companies have started to describe the basic broadband package as delivering speeds up to 200 Mbps. From what we can see, in many cities changing the description of the product to 200 Mbps did not mean a change in the speeds that customers are receiving – this seems in many cases to be a marketing shift to make cable broadband look faster.

The latest report also includes a few other interesting statistics:

  • Average upload broadband usage is now up to 32 gigabytes per month. OpenVault hasn’t been tracking this for very long, and this has grown from 25 gigabytes of data per month in the third quarter of 2020 – a 28% increase.
  • The average U.S. home now has 25 connected devices.

Build It, and They Will Fill It.

I assume that most people know the famous line from Field of Dreams where the disembodied voice promises, “Build it, and he will come.” For twenty years, I’ve been advising broadband clients against taking that advice. It doesn’t make any sense to invest a lot of money into building a broadband network without first having done enough market research to know that people will buy your services.

Today I want to talk about a similar-sounding idea – build it, and they will fill it. This is a shorthand way to describe the unbelievable growth in broadband demand. I’m now warning clients to build new networks that are robust enough to handle the future demand that will inevitably be coming from customers.

We have a lot of evidence of the fast growth of broadband usage. Center stage is statistics from OpenVault that has reported on the average nationwide broadband usage by homes as follows:

1st Quarter 2018          215 Gigabytes

1st Quarter 2019          274 Gigabytes

1st Quarter 2020          403 Gigabytes

1st Quarter 2021          462 Gigabytes

It’s easy to think that the usage spike created by the pandemic is an anomaly, but recent broadband growth has been only slightly higher than the long-term growth trend. The amount of bandwidth used by the average home has been doubling about every three years for several decades.

Another statistic from OpenVault tells a similar story. OpenVault has labeled households that use more than a terabyte of data per month as power users. The percentage of power users has grown from 4% of all homes at the end of 2018 to almost 11% by the middle of 2021.

There are two reasons that average household broadband usage has been growing. Over time, homes are finding new ways to use broadband while also using more broadband for the things we’ve always done.

I think most of us see how familiar tasks are using more broadband. A few years ago, I used Microsoft Word and Excel locally on my computer and the only time I used bandwidth was when I sent a document to somebody else. Today, my files are automatically stored in the cloud as I type, and I also keep another backup copy of everything in a different cloud. I also participate in collaboration software that stores some of the same documents again. For somebody that creates as many spreadsheets and word documents as me, this is a major increase in home broadband usage.

But it’s the new uses of broadband that really add up. New uses of broadband are coming along every day. Just a few years ago, I talked almost exclusively on my cellphone. Today I probably average three hours per day on video calls. As a sports fan, it’s not unusual for me to be streaming two or three 4K games at the same time. I’m not a gamer, but the major game platforms were all in the process of migrating to the cloud just as the pandemic hit. Our Subaru dumps a big file into the cloud every time we pull into our driveway. YouTube has started accepting 8K video that requires a 50 Mbps download stream. There are already early experimental HD virtual reality streams online.

I’m regularly asked why fiber is superior to technologies like wireless or satellite networks – and the answer is easy. Anybody who builds a new broadband network must be prepared for that network to carry ten times more broadband traffic in a decade and one hundred times more traffic in twenty years. Fixed wireless networks are not going to be able to do that. Satellite networks won’t even come close. Until the cable companies make major upgrades, they are already fallen badly behind the demand curve for upload bandwidth.

If you build a fiber network, your customers will fill it. When it gets too busy you can upgrade electronics and start the growth cycle all over again.

Reaching Critical Mass for Gigabit Connections

The statistics concerning the number of gigabit fiber customers is eye-opening. Openvault tracks the percentage of customers provisioned at various broadband speeds. At the end of 2019, the company reported that 2.81% of all households in the US were subscribed to gigabit service. By the end of the first quarter of 2020, just after the onset of the pandemic, the percentage of gigabit subscriptions had climbed to 3.75% of total broadband subscribers. By the end of the second quarter, this exploded to 4.9% of the total market.

It’s clear that households are finally migrating to gigabit broadband. The gigabit product has been around for a while. The earliest places I remember selling it to homes were municipal systems like Lafayette, Louisiana, and Chattanooga, Tennessee. Some small fiber overbuilders and small telcos also sold early gigabit products. But the product didn’t really take off until Google fiber announced it was going to overbuild Kansas City in 2011 and offered $70 gigabit. That put the gigabit product into the daily conversation in the industry.

Since then there are a lot of ISPs offering the gigabit product. Big telcos like AT&T and CenturyLink push the product where they have fiber. Most of the big cable companies now offer gigabit download products, although it’s only priced to sell in markets where there is a fiber competitor. Google Fiber expanded to a bunch of additional markets and a few dozen overbuilders like Ting are selling gigabit broadband. There are now over 150 municipal fiber broadband utilities that sell gigabit broadband. And smaller telcos and cooperatives have expanded gigabit broadband into smaller towns and rural areas all around the country.

The title of the blog uses the phrase ‘critical mass’. By that, I mean there are probably now enough gigabit homes to finally have a discussion about gigabit applications on the Internet. Back after Google Fiber stirred up the industry, there was a lot of talk about finding a gigabit application that needed that much bandwidth. But nobody’s ever found one for homes for the simple reason that there was never a big enough quantity of gigabit customers to justify the cost of developing and distributing large bandwidth applications.

Maybe we are finally getting to the point when it’s reasonable to talk about developing giant bandwidth applications. The most obvious candidate product for using giant bandwidth is telepresence – and that’s been at the top of the list of candidates for a long time as shown by this article from Pew Research in 2014 asking how we might use a gigabit in the home – almost every answer from industry experts then talked about some form of telepresence.

Telepresence is the technology to bring in realistic images into the home in real-time. This would mean having images of people, objects, or places in your home that seem real. It could mean having a work meeting, seeing a doctor, talking to distant family members, or playing cards with friends as recently suggested by Mark Zuckerberg. Telepresence also means interactive gaming with holographic opponents. Telepresence might mean immersion in a tour of distant lands as if you are there.

Early telepresence technology is still going to be a long way away from a StarTrek holodeck, but it will be the first step in that direction. The technology will be transformational. We’ve quickly gotten used to meetings by Zoom, but telepresence is going to more like sitting across the table from somebody while you talk to them. I can think of a dozen sci-movies that include scenes of telepresence board meetings – and that will soon be possible with enough broadband.

I’m looking forward to Openvault’s third-quarter report to see the additional growth in gigabit subscribers. We might already by reaching a critical mass to now have a market for gigabit applications. A 5% market penetration of gigabit users means that we’re approaching 7 million gigabit households. I have to think that a decent percentage of the people who will pony up for gigabit broadband will be willing to tackle cutting edge applications.

This isn’t something that will happen overnight. Somebody has to develop portals and processors to handle telepresence streams in real-time – it’s a big computing challenge to make affordable in a home environment. But as the number of gigabit subscribers keeps growing, the opportunity is there for somebody to finally monetize and capitalize on the capability of a gigabit connection. As somebody who now spends several hours of each day in online video chats, I’m ready to move on to telepresence, even if that means I have to wear something other than sweatpants to have a business meeting!

Data Usage Remains Robust in 2Q20

OpenVault recently published its Broadband Insights Report for the second quarter of 2020. Since OpenVault’s software is used to track usage in major Internet POPs, the company has a unique perspective on broadband usage in the country.

The report says that the peak of data usage this year was in March when people first reacted to the pandemic. Data usage is down slightly compared with the first quarter, but still much higher than data usage a year ago, In the second quarter the average home used 380 gigabytes of data per month. This is down 6% compared to the average usage in March 2020 of 403 gigabytes. But the second quarter data usage is up 36% over the average usage of 280 gigabytes per household used in the second quarter of 2019. Before the pandemic, household broadband usage was growing at a rate just above 20% annually, so the 36% growth in a year demonstrates the huge impact on the pandemic on broadband.

Median data usage has increased even faster than average usage. The median usage measures the middle point where half of homes use less and have of homes use more broadband. The median usage in the second quarter of 2019 was 144 gigabytes and has grown 54% in a year to 223 gigabytes. This indicates that even households that previously would have been light data users are now using a lot more data during the pandemic. This likely can comes from both increase cord-cutting as well as from students and adults working from home.

OpenVault reports that usage for homes with unlimited broadband plans (no data caps) grew even faster and increased by 42% over 2019. The company surmises that the big increase is at least partially because the big ISPs are not enforcing data caps during the pandemic. However, part of this increase is also likely due to an increase of what OpenVault calls power users. These are homes that use more than 1 terabyte of data per month.

In the second quarter 8.7% of homes used at least 1 terabyte of data per month, more than double the 4.1% of terabyte homes a year earlier. This now includes 1% of all homes that are using more than 2 terabytes of data, triple since a year earlier in 2019.

One reason for the higher data usage might be explained by households subscribing to faster data plans. At the end of the second quarter, 4.9% of homes are now subscribed to gigabit data speeds, more than double the 2.1% of gigabit subscribed in the second quarter of 2019. Over 61% of homes in the country are now subscribed to broadband speeds greater than 100 Mbps. That includes 37.8% subscribed to plans between 100 Mbps and 200 Mbps, 13.5% subscribed to plans between 200 Mbps and 400 Mbps, 5% subscribed to speeds between 400 Mbps and 900 Mbps, and 4.9% subscribed to gigabit speeds. Less than 20% of homes nationwide are subscribed to plans slower than 40 Mbps.

There is one segment of broadband usage that continued to increase in the second quarter of 2020. Upload usage from homes is up 56% over a year earlier. Upload demand is directly related to the need to connect for homes to connect to school and work servers and to take part in Zoom and other video conferencing services. It’s likely before the pandemic that many homes had never much needed the upload link from home.

What is most intriguing about the continued increase in upload demand is that upload usage continued to grow even after school semesters were ending for the year. During the second quarter tens of millions of upload links to school servers would have gone quiet as school semesters ended, and yet upload demand continued to grow. It’s going to be interesting to see what the fall school semester does to broadband usage.