1. The Future: Broadband & Mobile Data Presentation by Mindy McAdams

2. What is “broadband” Internet? Dial-up: 56,000 bits per second (56 Kbps) Dial-up: 56,000 bits per second (56 Kbps) U.S. Federal Communications Commission (FCC) defines broadband as 200 Kbps or faster U.S. Federal Communications Commission (FCC) defines broadband as 200 Kbps or faster South Korea: Slowest rate is 1,000 Kbps (1 megabit per second) South Korea: Slowest rate is 1,000 Kbps (1 megabit per second)

3. Benefits of broadband “Always on” “Always on” As opposed to dial-up: You disconnect when you finishAs opposed to dial-up: You disconnect when you finish Then re-connect each time you need the Internet (dial-up)Then re-connect each time you need the Internet (dial-up) Much faster file transfers and downloads (typical: 10 times faster) Much faster file transfers and downloads (typical: 10 times faster) Can handle a higher data rate Can handle a higher data rate Allows real-time videoAllows real-time video

4. Who’s on top?

5. Broadband growth U.S. U.S. 2001: 4.5 subscribers per 100 people2001: 4.5 subscribers per 100 people 2005, Dec.: 16.8 per 1002005, Dec.: 16.8 per 100 South Korea South Korea 2001: 17.2 subscribers per 100 people2001: 17.2 subscribers per 100 people 2005, Dec.: 25.4 per 1002005, Dec.: 25.4 per 100

6. Factors in Korea 2003: Government pledged to expand broadband infrastructure to reach every household by the end of 2005 2003: Government pledged to expand broadband infrastructure to reach every household by the end of 2005 Country is smaller than state of Virginia Country is smaller than state of Virginia Cost to gov’t: Nearly $11 billion Cost to gov’t: Nearly $11 billion Any Korean can get broadband at home today Any Korean can get broadband at home today Some ISPs charging as little as $19 a month for DSL Some ISPs charging as little as $19 a month for DSL

7. Rapid development in Korea Korean War, 1950-1953 Korean War, 1950-1953 Shortage of wired telephones until the mid-1980s Shortage of wired telephones until the mid-1980s Number of mobile phone users passed 10 million mark in 1998 Number of mobile phone users passed 10 million mark in 1998 Number of Internet users passed 10 million in 1999 Number of Internet users passed 10 million in 1999 48.8 million: total population today 48.8 million: total population today Source: Digital Review of Asia Pacific, 2005

8. Growth of Internet in Korea 1995: Korea had less than 1 Internet user per 100 inhabitants 1995: Korea had less than 1 Internet user per 100 inhabitants 1999: Korea surpassed the developed- nation average 1999: Korea surpassed the developed- nation average 2002: Korea was the world’s fifth-largest Internet market (26 million users) 2002: Korea was the world’s fifth-largest Internet market (26 million users) Today: Korea has third-highest Internet penetration in the world, and the highest in Asia Today: Korea has third-highest Internet penetration in the world, and the highest in Asia

9. The next stage Korea’s broadband market is still advancing, improving Korea’s broadband market is still advancing, improving Subscribers now switch platforms to get increased bandwidth Subscribers now switch platforms to get increased bandwidth Fiber optic-based broadband connections grew 52.4% in 2005 (Korea) Fiber optic-based broadband connections grew 52.4% in 2005 (Korea) Number of DSL subscribers fell (-3.3%) Number of DSL subscribers fell (-3.3%) Number of cable subscribers fell (-1.7%) Number of cable subscribers fell (-1.7%) Source: OECD Broadband Statistics, December 2005

11. The Internet in your hand More than 30 million Koreans (total pop. 48 million) carry high-end “smart phones” today More than 30 million Koreans (total pop. 48 million) carry high-end “smart phones” today In September 2006, the two largest cell phone service providers will open their networks to regular Wi-Fi In September 2006, the two largest cell phone service providers will open their networks to regular Wi-Fi Phones will be equivalent to (tiny) computers Phones will be equivalent to (tiny) computers Source: Korea Times, Jan. 9, 2006

12. Popularity of data services Korea’s largest mobile-phone operator says mobile data and wireless Internet services account for about 40% of its yearly revenues Korea’s largest mobile-phone operator says mobile data and wireless Internet services account for about 40% of its yearly revenues A huge factor is renewing song lists each month, for a fee of 5,000 won ($5.30) per month A huge factor is renewing song lists each month, for a fee of 5,000 won ($5.30) per month Cell phone customers get unlimited access to 700,000 songs Cell phone customers get unlimited access to 700,000 songs

13. More than talking & texting In South Korea and Japan, mobile phone service providers make profits on: In South Korea and Japan, mobile phone service providers make profits on: Mobile Internet accessMobile Internet access Entertainment, ringtones and musicEntertainment, ringtones and music GamesGames Mobile TV and videoMobile TV and video Community portalsCommunity portals Mobile transactionsMobile transactions

14. Your cell phone = your digital wallet Soda machines Soda machines Game arcades Game arcades Convenience stores Convenience stores Fast food Fast food

15. Using your phone to pay online Order a downloadable song on your computer Order a downloadable song on your computer Enter your cell phone number and a national identification number on the seller’s Web site Enter your cell phone number and a national identification number on the seller’s Web site A computer verifies that the two numbers match A computer verifies that the two numbers match A code is sent to your phone as a text message A code is sent to your phone as a text message You type the code on the Web site (on your computer) and get the song You type the code on the Web site (on your computer) and get the song The charge shows up on your cell phone bill The charge shows up on your cell phone bill

16. “3G” cell phone penetration 93% of 3G subscribers are in Asia-Pacific and the Americas At the end of 2004, three countries had over 100 million 3G subscribers The United States (49.5 million) South Korea (27.5 million) Japan (25.7 million) That was three-fourths of the worldwide total Source: ITU Development Report, 2006

17. U.S. use of cell phones 74% of Americans who own cell phones say they have used it in an emergency (and got help) 74% of Americans who own cell phones say they have used it in an emergency (and got help) 28% of cell phone owners admit they sometimes “do not drive as safely as they should” while using their cell phone 28% of cell phone owners admit they sometimes “do not drive as safely as they should” while using their cell phone Source: Pew Internet & American Life Project, 2006

18. U.S. use of cell phones 36% of cell phone owners say they have been shocked from time to time at the size of their monthly cell phone bill 36% of cell phone owners say they have been shocked from time to time at the size of their monthly cell phone bill 82% of all Americans say they have been “irritated” by loud and annoying people making a call in a public place 82% of all Americans say they have been “irritated” by loud and annoying people making a call in a public place Source: Pew Internet & American Life Project, 2006

19. What U.S. users wish for 47% of cell owners say they would like to have maps on their phone 38% say they would like to have IMs from selected friends sent to their phone 24% of cell owners would like to add e- mail 24% of cell owners say they would like to search for movie listings, weather reports and stock quotes Source: Pew Internet & American Life Project, 2006

20. What U.S. users do Source: Pew Internet & American Life Project, 2006

21. Liars! 22% of cell phone users say they are “not always truthful” about exactly where they are when they are on the phone 39% of cell phone users ages 18-29 say that

22. How popular are cell phones? 195 million cell phones in the U.S. (current est.): 65 percent (July 2006 est., U.S. Census) Total U.S. population: 298.4 million (July 2006 est., U.S. Census) 35 million-plus cell phones in South Korea (May 2004 est.): 73 percent then 48.8 million Total South Korea population: 48.8 million

23. Internet usage in the U.S. About 67% of all Americans now use the Web About 67% of all Americans now use the Web About 84% of all 18- to-29-year-olds now use the Web About 84% of all 18- to-29-year-olds now use the Web 89% of all college graduates do 89% of all college graduates do 85% of people earning $50,000 to $75,000 do 85% of people earning $50,000 to $75,000 do (Data from early 2005)

24. Internet usage in the U.S. In the past year, the number of active home broadband users in the U.S. increased from 74.3 million (Feb. 2005) to 95.5 million (Feb. 2006) 68% of active Internet users (at home) were using broadband Overall Internet penetration in the U.S. has stabilized in recent years, reaching 74% (of homes) Source: Nielsen//NetRatings, February 2006

25. Who gets the most traffic? (by corporate owner) Source: Nielsen//NetRatings, February 2006

26. Who gets the most traffic? (by site brand name) Source: Nielsen//NetRatings, February 2006

27. Trends Since Feb. 2003, average time spent on the computer at home per month has increased by 5 hours (from 25.5 hours per month to 30.5) Since Feb. 2003, average time spent on the computer at home per month has increased by 5 hours (from 25.5 hours per month to 30.5) Use of online video is growing: Use of online video is growing: MSN Video had 9.3 million unique visitors in Feb. 2006, a 44% increase over Feb. 2005 YouTube had 9.0 million unique visitors Google Video had 6.2 million unique visitors Source: Nielsen//NetRatings, February 2006

28. Now, to look at the global picture …

29. Huge disparities in access Source: ITU Development Report, 2006

30. The world’s digital divide 2004: Fewer than 3 out of every 100 Africans use the Internet, compared with an average of 1 out of every 2 inhabitants of the G8 countries 2004: Fewer than 3 out of every 100 Africans use the Internet, compared with an average of 1 out of every 2 inhabitants of the G8 countries G8: Canada, France, Germany, Italy, Japan, Russia, U.K. and U.S.G8: Canada, France, Germany, Italy, Japan, Russia, U.K. and U.S. Total Internet users in the G8 countries (429 million) roughly equals the rest of the world combined (444 million ) Total Internet users in the G8 countries (429 million) roughly equals the rest of the world combined (444 million ) 15% of the world’s population lives in the G8 countries 15% of the world’s population lives in the G8 countries Source: ITU’s World Telecommunication Indicators Database, 2004

31. The world’s digital divide Total Internet users on entire African continent Total Internet users on entire African continent 8 times as many are in the U.S.8 times as many are in the U.S. 3 times as many in Japan3 times as many in Japan More than twice as many in GermanyMore than twice as many in Germany Today 30 countries have an Internet penetration of less than 1% of their population Today 30 countries have an Internet penetration of less than 1% of their population Source: ITU’s World Telecommunication Indicators Database, 2004

32. … and it’s slow too! Bandwidth is also not equal around the world (affects the speed at which Web sites in other countries can be accessed) Bandwidth is also not equal around the world (affects the speed at which Web sites in other countries can be accessed) Denmark (a tiny country) has more than twice the international Internet bandwidth of ALL of Latin America and the Caribbean Denmark (a tiny country) has more than twice the international Internet bandwidth of ALL of Latin America and the Caribbean Source: ITU’s World Telecommunication Indicators Database, 2004

33. A rural / urban divide in the U.S. By the end of 2005, 24% of rural Americans had high-speed Internet connections at home … Compared with 39% of adult Americans living in cities and suburbs Source: Pew Internet & American Life Project, February 2006

34. U.S. broadband in homes Source: Pew Internet & American Life Project, February 2006

35. The End Presentation by Mindy McAdams