Why U.S. Networks "Lag Behind"


Often, as I’m reading articles discussing the rollout of new mobile phone networks, or next-generation access to the Internet, I’m frustrated by the punditry that accompanies them. Frequently statements are made about how the U.S. “lags behind” Europe and Japan in terms next-gen network deployments, and very rarely are these statements given proper qualifiers, which leaves the average U.S. citizen wondering why we are so far behind the curve. Let me explain why the problem is one of profitability, not one of technology.

What a lot of U.S. consumers don’t understand is that the population density in these countries with widespread availability of the latest mobile phone networking technology, for instance, makes it easy to justify rolling out newer technology by giving companies a speedier return on their investment.

Such is the case for most of the connectivity technologies that see more rapid adoption overseas. There are large areas of the U.S. that are simply not densely populated enough to justify the expense of rolling out cutting-edge networks there. It isn’t a matter of the US simply being behind the technological curve, as some like to assume.

Have a look at this chart over at the Wikipedia entry for population density. Notice how the U.S. shows up as green while these countries with a high penetration of next-gen networking tech are purple? Now, keep in mind as well that in a country with as much land as the U.S., this density chart is thrown off by the massive concentrations of people in major metropolitan areas while more rural areas may have someone driving for miles without seeing another soul. In fact, at the time of this writing in this list of countries by population density, the United States is #180 out of 241, with a population density of 31 people per square kilometer. What this means, in layman’s terms, is that in the U.S. it is much more likely that a mobile phone tower or miles of fiber optic cable might need to be deployed to provide service to 100 people and 5 cows, while those same resources will provide service to tens of thousands of eager consumers in another country.

Pardon the PHB nature of this next statement, but these are the types of differences that turn a 3-year ROI into a 15-year ROI, and slow down the rate of adoption.

I’m glad I got that off my chest. Now, the next time you read an article lamenting the sad state of networking technology adoption in the U.S., make sure to tell the author to qualify his statements.

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