As China takes its first steps in space it has also overtaken the United States as the country with the most broadband lines. Broadband research company Point Topic says that China and the United States both had around 78 million broadband lines at the end of August, but the number in China is now growing twice as fast as in America.

In the first half of the year China added nearly 9.5 million broadband lines, while just over 3.5 million were added in the United States. Point Topic now estimates that China has overtaken America as the largest broadband market in the world.

“This is a major milestone for China,” says Oliver Johnson, the chief executive of Point Topic. “Launching people into space is spectacular, but having the biggest broadband market down here on earth means a lot more for building a modern, hi-tech economy.”

Point Topic observes that it is not so surprising that the United States has been overtaken in absolute numbers as China has more than three times as many homes and people. However, the United States has also fallen behind the leading European and Asian countries in percentage penetration of broadband.

This has serious implications for the competitiveness of the United States economy, suggests Point Topic. While the big debate in America is currently focussed on the immediate economic crisis, there are longer term issues of competitiveness.

Point Topic observes that light-touch regulation is not only an issue for Wall Street, but also a problem with broadband. It says it has allowed incumbent operators to keep the broadband market largely to themselves, leading to higher prices and slower growth. In many countries where there is more open competition the broadband market has leapt ahead, not just in China.

Much of the thinking about online video is dominated by the American market, but although significant it only represents a proportion of the total number of broadband homes worldwide.