Twenty-nine percent of all U.S. households (31 million homes) do not have Internet access and do not intend to subscribe to an Internet service over the next 12 months, according to Parks Associates' National Technology Scan. This nationwide project, now in its second year, found the main professed cause for non-subscribers is not economic but a low perceived value of the Internet. Forty-four percent of these households say they are not interested in anything on the Internet, and just 22 percent say they cannot afford a computer or the cost of Internet service.

National Technology Scan also found that in 2006, broadband penetration increased from 42 percent to 52 percent, with roughly one-half of new subscribers being converted dial-up users and the other half households that previously had no access.

"The industry continues to chip away at the core of non-subscribers but has a ways to go," said John Barrett, director of research at Parks Associates. "Entertainment applications will be the key. If anything will pull in the holdouts, it's going to be applications that make the Internet more akin to pay TV."

National Technology Scan is a nationwide survey that provides a picture of current adoption levels, demand, and the size of the total available market for advanced products and services. Such data are crucial for strategic planning and forecasting sales and revenues.

KW