1. The Future of Broadband Daniel Ballon Pacific Research Institute Broadband Summit: Connecting America FCC-NARUC Joint Conference on Advanced Services November 6, 2008

2. A Brief History of Broadband Data provided by Link Hoewing/Verizon Access Speed (Mbps)

3. Innovation Drives Broadband Growth Pew Internet, Home Broadband Adoption 2008 Innovation Demand Broadband Investment Broadband Adoption

4. Investment is Limiting Factor Today Net neutrality debate is good news for broadband YouTube consumes more bandwidth today than the entire Internet in 2000 May 7, 1997: WWW = World Wide Wait “The average Internet user in America spends 25 hours a year waiting for web sites to download.” ─Former FCC Chairman William Kennard, February 8, 2000 “We confront a dynamic marketplace, characterized by rapid changes in technology, a new business alignment with every passing day, and lightening-speed changes in the flow of capital.” ─Former FCC Commissioner Susan Ness, January 20, 1999

5. Investment Today is Strong Cumulative Cable Infrastructure Investment (Billions) Total Investment in Communications Equipment (Billions) Jeffrey Eisenach, Broadband Policy: Does the U.S. Have it Right After All? Progress and Freedom Foundation “We should conceptualize broadband capability as a function that can ride on many different electronic platforms. Broadband is not a copper wire. It is not a coaxial cable. It is not a wireless channel. It is all of these things. The capability can ride on many platforms (and should) in order to tailor solutions to consumer patterns and interests.” ─ Former FCC Chairman Michael Powell, October 25, 2001 “We should conceptualize broadband capability as a function that can ride on many different electronic platforms. Broadband is not a copper wire. It is not a coaxial cable. It is not a wireless channel. It is all of these things. The capability can ride on many platforms (and should) in order to tailor solutions to consumer patterns and interests.” ─ Former FCC Chairman Michael Powell, October 25, 2001

6. Thriving Broadband Competition Fifth FCC Report on Advanced Telecommunications, June 12, 2008 NOTE: As of March 19, 2008, the minimum “broadband” connection speed was raised to 768 Kbps Only 0.1% of zip codes have no broadband providers 89% of zip codes have more than four broadband providers 23% of zip codes have more than ten broadband providers

7. Explosion in Bandwidth Appetite Cisco Global Internet Traffic Forecast Informa Telecoms Mobile Forecast

8. New Innovations Will Drive Future Broadband Growth 1) High Definition Video-on-Demand Requirement = 10 Mbps Customer base for streaming HD VoD will expand 7-fold in 5 years (~30% of all households)

9. New Innovations Will Drive Future Broadband Growth 2) Internet TV Source: iSuppli, May 2007 Source: Ipsos Insight, May 2008

10. New Innovations Will Drive Future Broadband Growth 3) Video Conferencing Three Waves of Internet Traffic Growth Cisco, 2008 CNET, Inc. 1964 2008 Bell Labs

11. New Innovations Will Drive Future Broadband Growth 4) Telemedicine 5) Virtual Worlds 6) Online Gaming7) Cloud Computing

12. Broadband Innovation: Cable & DOCSIS 3.0 Data Over Cable Service Interface Specifications (DOCSIS) Cable360.net ARRIS Group DOCSIS Progression DOCSIS 1.0 DOCSIS 1.1DOCSIS 2.0DOCSIS 3.0 Bandwidth (Mbps)

13. Broadband Innovation: Cable & DOCSIS 3.0 Cable Industry Infrastructure Expenditures $ (Billions) Source: NCTA Cable Broadband Availability % U.S. Households Cable Broadband Customers Customers (Million)

14. Broadband Innovation: FTTx Verizon FiOS AT&T U-Verse BPON Downstream: 622 Mbps Upstream: 155 Mbps GPON Downstream: 2.5 Gbps Upstream: 1.5 Gbps Downstream: 25-37 Mbps Upstream: 6 Mbps

15. Broadband Innovation: FTTx Verizon FiOS Customers (Million) Verizon RVA Research FTTH Penetration AT&T U-verse FTTN AT&T

16. Broadband Innovation: 4G Wireless Networks Evolution of Wireless Technologies Data Transmission Speeds (Mbps) 50 Mbps-1 Gbps 60 Kbps-54 Mbps 20 Kbps-171 Kbps 10 Kbps-40 Kbps 1995 2000 2005 2010 Orthogonal Frequency-Division Multiplexing IEC WiMAX BackersLTE Backers

17. Broadband Innovation: 4G Wireless Networks

18. Broadband Innovation: Satellite Internet? The Kizuna Satellite O3b Networks

19. Conclusions The future of broadband looks bright Abundant innovation in both content and delivery The U.S. is leading the way in many future technologies Multiple technologies in direct competition Important not to give unfair advantages through inconsistent regulation Important not to pick winners through subsidies