Boy Genius Report is highlighting the Speedtest.net report on average broadband speeds and drawing all the wrong conclusions.

Net Index ranked the US 26th in the world for downlink speeds with an average downlink speed of 10.16Mbps. Such speeds might not seem all that bad at first glance, but considering that the global average is 7.67Mbps, it’s clear that US ISPs have a lot of ground to make up.

That’s not actually true.  Here, for instance, is my Speedtest.net result

I am paying slightly more per month for a 35mbps connection through Cox.  Most cable operators are now offering much higher speeds, but not necessarily at the entry level tier.  I choose to pay more because I want the speed.  And I am now on par with South Korea.  I could have gone as high as 50mbps, but didn’t want to spend that much.

DSL Report lists Comcast’s current speeds between 12 and 50mbps down.  In the coming months, that low end will rise to 16, and the high end will jump to 100+.  Most people, however, will still take the 16.

That doesn’t mean the US is falling behind, it simply demonstrates that most people will pay the minimum that affords them a good experience.  Do they need 50mbps to watch YouTube or play Xbox Live?  Nope.  Not at all. So why would they pay a significant amount more for speed they won’t use?

This becomes a chicken and egg question.  Developers haven’t created applications that take advantage of the speed (yeah, yeah, cloud based storage, yipee!).  So why would consumers spend money on speed that goes to waste?  Our average speed could easily be much higher if more applications took advantage of it.  But someone has to take the lead, and it likely won’t be consumers.  Demonstrate a “must have” app that requires that kind of speed, and you’ll see more people upgrading.

Case in point, I can tell you from personal experience that the arrival of graphics on the net back in the mid 90s did more to drive sales of 56k modems (and eventually broadband) than anything else.  Waiting for downloads at 9600 or 14,400 bps was painful.  When people began developing graphic intensive sites, people adopted faster speeds in response.  Where is the app today that demands 100mbps?

On the innovation point, however, an interesting observation from NewTeeVee noted that countries with the fastest broadband saw less innovation in actual services.  Countries toward the middle or rear of the pack, however, were doing very interesting things with video delivery and P2P.  There is an argument that faster broadband leads to more innovation. At least in the case of video, that doesn’t appear to be true.

It’s also interesting to note that none of the countries ahead of us on the broadband curve have implemented anything like the non-discrimination net neutrality rules America is considering.  While some have adopted open access or unbundling regimes, the draconian net neutrality rules our government is considering have been specifically rejected in many countries.