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People still signing up for broadband

Despite a wide technology downturn, Internet subscriber figures continue to grow in the United States, according to a new study.

Despite a wide technology downturn, Internet subscriber figures continue to grow in the United States where a majority of homes have at least dial-up access and nearly one in four online households use a broadband connection, according to a new study.

The June 2001 survey, conducted by Gartner Dataquest, shows that 65 million U.S. households, or 61 percent of the nation's homes, actively use the Internet on a regular basis. The total represents an increase of 8.4 million customers since November 2000, when the research firm last conducted a similar study. Gartner Dataquest is the market research arm of business consulting firm Gartner.

"As more and more of the world get on (the Internet), you want to be on it too," said Peggy Schoener, a senior communications industry analyst at Gartner Dataquest. "As it gets more accepted, the others come along."

According to the study, 91 percent of respondents said they would continue to subscribe to an Internet service, a sign Gartner Dataquest suggests indicates the Net has become essential in American homes.

Despite the increase in rates for high-speed Internet access and the demise of portions of the market for DSL (digital subscriber line) connections, Gartner Dataquest estimates that just shy of 25 percent of U.S. households online connect to the Internet via a broadband connection. DSL and cable modems are the two leading methods of high-speed Net access.

The study shows that cable modems, which have led the broadband race for years, account for more than 50 percent of all broadband connections. According to the survey, almost 20 percent of dial-up Internet customers said they intend to subscribe to a high-speed alternative by mid-2002.

The estimate is a positive sign for the broadband industry, which recently raised rates for high-speed access and which is notorious for subjecting new customers to laborious sign-up and installation hurdles. Broadband customers have complained for years that installations are lengthy and complicated.

"We did expect a bit of a slowdown in terms of high speed because of the pocketbook--both the raising of the price and people being concerned about their jobs. But that didn't seem to have an effect, at least not yet," Schoener said.

Interestingly, Schoener said the firm's research shows that of new high-speed Net users, 16 percent went directly to a broadband connection rather than upgrading from dial-up.