In the News

Published September 1, 2005

99% of Libraries Offer Free Internet

Free high-speed Internet connections are available in almost 99 percent of U.S. public libraries, including most in high-poverty urban areas, according to a study conducted by Florida State University researchers and funded by the American Library Association and the Bill and Melinda Gates Foundation.

The findings, released in June, dent claims that substantial portions of urban populations have no access to inexpensive broadband. Many advocacy groups, including the Consumer Federation of America and Free Press, have urged local governments to embark on large-scale, long-term, taxpayer-funded programs to blanket entire cities with wireless broadband systems. Philadelphia, for example, has taken bids on a system projected to cost between $15 million and $20 million. San Francisco Mayor Gavin Newsom has spoken in support of a city-operated system that would offer free wireless for low-income residents and the homeless.

Of the libraries that offer free Internet access, 18 percent have wireless access and 21 percent expect to upgrade to wireless within a year. Urban areas, which also had some of the highest poverty rates, tended to have the highest levels of connectivity. Libraries in rural areas were more likely to have slower connections and fewer workstations.

The study sampled 6,865 of the 16,192 public libraries in the U.S. and received responses from 5,023.

Number of VoIP Subscribers Grows

The number of retail Voice over Internet Protocol (VoIP) accounts reached 2.1 million in the U.S. in the first quarter 2005, according to Point Topic, a U.K.-based telecom market research firm.

U.S. cable companies are seeing the biggest growth, the report said. Time Warner Cable posted a 69 percent growth in VoIP customers between December 2004 and March 2005. Vonage, the start-up company that pioneered retail VoIP, saw a 38 percent growth in accounts in the same period.

Worldwide, Point Topic estimated there are 11 million VoIP users. Japan leads the world with 7.2 million accounts. France is Europe’s biggest user of VoIP, with 1.2 million.

Turnabout Is Fair Play?

With VoIP and wireless competition eating into conventional dial tone revenues, some Bell companies have begun offering wireline service as a sweetener with wireless sales, according to an article in Telephony magazine that cites a recent Yankee Group report.

The strategy reverses the common tactic that Bell companies used in the 1990s to build wireless revenues by bundling cellular service with basic dial tone.

BellSouth, for example, is putting its own representatives in Cingular Wireless retail stores. SBC and Qwest are attempting to “upsell” customers to wireline when they come in to purchase a cell phone.

Yankee Group analysts see the move as a telco opportunity to leverage wireless operations–an asset their cable competitors don’t have, Telephony noted.

Numerous studies have shown the number of wireless accounts has surpassed the number of dial tone lines in the U.S. For many consumers, especially single men and women under 30, wireless constitutes their primary phone service.

Mobile Gambling to Boom

The controversial market for mobile gambling content is predicted to generate $7.6 billion in worldwide revenues by 2010, according to a study by Informa Telecoms and Media, a U.K.-based research and publishing company. The mobile gaming market, a subset of the larger Internet gaming market, currently stands at $1.2 billion.

Although Internet gambling is illegal in the U.S., the laws have been nearly impossible to enforce. The report predicts that by 2010, $979 million in mobile gaming revenues will come from the U.S., but cautions that much depends on how federal and state laws shake out.

The state of Nevada recently approved the use of hand-held gaming devices in casinos located there. While the games will work like Internet gaming sites do, the law calls for devices and access to be controlled by individual casinos. The law will allow the devices to be used only on the casino floor and in public areas such as casino restaurants and pools.

Steven Titch ([email protected]) is senior fellow for IT and telecom policy at The Heartland Institute.