March 2003 - An Update From the Digital World


Residential broadband may have finally hit critical mass
In CQ4:02, a record 1.9MM+ new broadband customers came online in the US, bringing the total to 17MM+ (up 57% Y/Y), or 17%+ of households. Global subscriber count appears to be at least 44MM and growing fast.

We see an emerging category of “power consumers”
Of the estimated 550–600MM Internet users worldwide, an emerging group of 10–44MM users can be characterized as “power consumers,” based on their adoption and use of some key services and technologies.

Broadband trends help explain strong growth in CQ4:02 e-commerce retail sales
e-commerce retail sales were $14B in CQ4:02, up 28% Y/Y and up 30% Q/Q, according to recent US Department of Commerce data.

Our Internet & PC Applications Software Industry View is Attractive
We continue to believe that, at the margin, online is gaining share from offline, that this will occur for some time to come, and that this should continue to benefit the Internet leaders. So far, it appears that trends in 2003 have been strong.

March 2003 - An Update From the Digital World (13 pages)