America's Most Wired Cities

Pop quiz: What's America's most wired city? You might guess someplace in Silicon Valley, Los Angeles or San Diego. East Coast fans might bet on New York or even Chicago.

But you've got to head south.

For the second year in a row, Atlanta tops Forbes.com's survey of America's most wired cities in the U.S.

In Pictures: America's Most Wired Cities

A variety of factors boost the Big Peach's techno quotient. As the communications hub for the Southeast, Atlanta boasts regional headquarters for AT&T (nyse: T - news - people ) and Verizon (nyse: VZ - news - people ) and a bustling community of Internet-related start-ups. It's also home to BellSouth and EarthLink (nasdaq: ELNK - news - people )--a major promoter of citywide wireless networks until recent months--as well as cable giant Cox Communications. And it got an early jump on cutting-edge technology after spending millions to wire its downtown area for the 1996 Olympics.

Still, its leading status mystifies some. "It's a dynamic area with a lot of young people, but exactly why it's No. 1 is a mystery to me," notes telecom analyst Jeff Kagan, who coincidentally is a long-time resident of Atlanta.

Here are some clues. To calculate our list, we looked at the percentage of Internet users with high-speed access, the range of service providers within a city and the availability of public wireless hot spots. Atlanta ranks highest in broadband adoption, access options and fourth in wi-fi availability. According to Nielsen Online, 97.2% of the city's home Internet users accessed the Web via a high-speed connection in November.

Some obvious choices finished high on the list. Techie Seattle, home to Microsoft (nasdaq: MSFT - news - people ), came in second, one notch above last year. San Francisco, the closest major city to Silicon Valley, was fourth for the second time. Though rich in hot spots, both lagged behind other cities in broadband adoption. (It works the other way, as well: Boston ranks second in broadband but poorer showings in the other categories dragged it down to 13th overall.) Two other major metropolises, Chicago and New York, improved their standings from 17th to 8th and 12th to 9th, respectively, to make the top 10, driven by more widespread adoption of high-speed Internet.

Other top-10 finishers were more surprising, such as third-place Raleigh, N.C. Raleigh Chief Information Officer Gail M. Roper attributes the city's strong showing to its thriving entrepreneurial culture, technology initiatives, major universities and fast-growing, highly-educated population. As CIO of Kansas City, Mo., (No. 22) from 1996 to 2006, Roper focused on digital-divide issues, working to improve youth and student access to the Internet. In Raleigh, she is considering building a citywide wi-fi network to expedite public services, cut telecom costs and deliver tourism information.

Fifth-place Orlando, Fla., and Baltimore also aren't top-of-mind when it comes to Internet initiatives. But Orlando, home to tourist-magnet Disney World, has "people coming in from all over--it has to be wired," explains Kagan. Baltimore vaulted to a 16th-place finish as the number of broadband providers and the adoption of those services rose dramatically last year.

Los Angeles wasn't as lucky. The entertainment capital suffered the biggest drop, plummeting from No. 11 to No. 27, based on lackluster results in all three categories, particularly in the number of broadband access providers. Close competition makes the tumble look worse than it is. First-place Atlanta is home to 17 broadband providers, while Los Angeles, with only 11, now ranks 25th in access options this year. Houston, Cleveland and Detroit dropped off the list completely, allowing newcomers Denver (No. 17), Indianapolis (No. 24) and Milwaukee (No. 28) to make their debut.

Measuring a city's "wired-ness" is an imperfect science. New York's less-wired outer boroughs weigh down its overall ranking. Some new initiatives aren't yet reflected in the data we used. Several lower-ranked cities, like Philadelphia (No. 26), are building wireless networks that provide wi-fi to downtown areas. In New York, CBS (nyse: CBS - news - people ) is constructing hot spots in midtown Manhattan (See "NYC's Biggest Hot Spot.")

Start-up Meraki recently announced it would offer free high-speed wireless Internet throughout San Francisco by the end of 2008. Top-ranked Atlanta, meanwhile, has seen plans for such a system fizzle in recent months. The ubiquity of such wi-fi networks is difficult to quantify and not measured in our wireless hot spot data.

Longer term, the outcome of the Federal Communications Commission spectrum auction, which is pitting traditional telecom companies against newcomers, including Internet titan Google (nasdaq: GOOG - news - people ), will also have a major impact on the availability of wireless service throughout the U.S. (For more on the auctions, see “Phoning In Wireless Dreams” and “Google’s Wireless World.”)

Though hot spots are sprouting across the country, as major wi-fi provider Wayport powers more than 10,000 in hotel chains, airports and McDonald's (nyse: MCD - news - people ), most Americans still rely on phone and cable firms for their Web access. Nearly half (47%) of adult Americans had a broadband connection at home in March 2007, representing 12% year-over-year growth, according to the Pew Internet & American Life Project. Of those users, 70% had a broadband connection, while 23% used dial-up. A separate Pew study done in December 2006 found that 19% of Internet users have wireless networks in their homes.

Those figures may be upended soon. "Broadband adoption is starting to plateau," says Bruce McGregor, senior analyst of Digital Home Services for market researcher Current Analysis. Telephone companies have traditionally offered digital subscriber lines (DSL) at lower prices while cable firms charged premiums for faster connections. But these days, the broadband industry's focus is bundling services, such as voice, data and TV together for a reduced price.

The new model is pitting telcos against cable providers. AT&T and Verizon have spent the past two years or so upgrading to super-speedy, fiber-optic networks. Verizon's FiOS has had a significant impact in the areas where it is offered, says McGregor, with the company selling service to 6.5 million households by the end of September 2007. AT&T says it will aggressively expand its competing service, U-verse, to 30 million homes by 2010. Meanwhile, Sprint Nextel (nyse: S - news - people ) still appears committed to roll out a nationwide high-speed wireless network using its WiMAX technology sometime this year.

To compile our list, we began with top markets in broadband adoption as determined by Internet market research firm Nielsen Online. Utilizing Nielsen market data eliminated some large, tech-savvy cities, such as San Jose, Calif. (Nielsen aggregates San Jose data with the San Francisco market area, and so San Jose's broadband can't be accessed separately.) We also dropped cities that didn't make the U.S. Census Bureau's top 100 list, including Salt Lake City and Hartford, Conn. We then calculated the number of service providers per city using statistics from the FCC and wi-fi hot spots per capita via public hot spot directory JiWire.

More accurate data may be on its way. A "broadband census" bill proposed by Rep. Edward J. Markey (D-Mass.) and passed by the House of Representatives in November asks the FCC to collect more detailed information on the price and speed of broadband service and the number of subscribers in a particular zip code. That could mean a radically different list in 2009.

read more | digg story