Consumer Usage of Broadband Internet Services - Adoption, Usage, and Global Impact of Broadband Technologies - page 201

BROADBAND USAGE IN PORTUGAL and Grande Porto), and the lowest education

levels (i.e., illiterate) being in some of the low-
est income regions (for example Madeira and
Alentejo). The vast majority owns a television;
however few have more than one car. On average,
in 2006 about 40 percent of Portugal households
accessed the Internet from their homes. Of those
with home Internet access, 61 percent used dial-up
Internet access but that proportion is shrinking.
Norte Litoral, Grande Lisboa and Centro Litoral
had greater home Internet access via cable than
by phone.
A primary focus is to understand usage pat-
terns and intensity of use among fixed, mobile,
and nomadic consumers. 7 As prior literature has
found education to be a significant determinant
of broadband usage, we illustrate fixed, mobile,
and nomadic usage by education level from 2008
survey data. This and other such delineations serve
to frame the empirical models used in the analyses.

Broadband access to the Internet was offered in
Portugal through cable modem technology begin-
ning in 1999. In 2000, the telecommunications
industry was fully liberalized, and local loop un-
bundling was mandated in 2001. Subsequently, the
telecommunications incumbent Portugal Telecom
(PT) began offering broadband Internet access
through ADSL, and currently offers broadband
Internet access both through DSL and cable. 3
Among EU Member States, Portugal has the
highest ratio of fixed broadband subscribers using
a provider other than the incumbent. However,
Portugal also has one of the lowest growth rates
in fixed broadband. In fact, by the broadband
performance index developed, Portugal ranks
poorly - in the fourth of five clusters. The 2008
ITIF Broadband Rankings listed Portugal as
18 th , with a composite score only slightly higher
than average (10.15 compared to an average of
10.00). 4 Currently Portugal residents increasingly
use mobile broadband. Portugal makes intensive
use of mobile communications services with 58
percent of voice traffic originating from mobile
networks. The mobile market also is credited with
exhibiting low churn and high customer loyalty.

Analyses and Results 8

Characteristics of Broadband
Consumers

Prior research focuses on characteristics primarily
of fixed broadband users. Including characteristics
of fixed, mobile, and nomadic broadband users
in Portugal provides evidence that across tech-
nologies, there is some variation in characteristics
among users. We begin by describing the empirical
models used in the analysis.
Empirical models for analyses of user char-
acteristics employ utility models in which the
utility of individuals from alternative modes of
Internet access depends on characteristics of the
individual or household, and on characteristics of
the respective mode of Internet access. 9 Specifi-
cally, the multinomial logit model, 10 which is an
extension of the logit regression model used to
represent the choice between mutually exclusive
options, is appropriate to use. 11

Data 5

For our analyses we draw upon data largely ob-
tained from three surveys conducted in Portugal
in 2006 and 2008. 6 The surveys were stratified by
geographic regions of the country that correspond
generally with the Nomenclature of Territorial
Units for Statistics (NUTS II) geographical cod-
ing used by the European Union to indicate divi-
sions of countries for statistical purposes. These
regions include: Açores, Algarve, Centro Litoral,
Grande Lisboa, Grande Porto, Interior, Madeira,
and Norte Litoral.
Education levels vary across the regions, with
the highest education levels being in the most
urban and highest income areas (Grande Lisboa