U.S. broadband among most expensive worldwide: why?

We don’t have to continue letting the duopoly gouge us for slow and expensive Internet access. We don’t have to wait for Washington or Atlanta, either. We do need our local leaders to stop defining away the issue and get on with doing something about.

Tom Geoghegan wrote for BBC News 27 October 2013, Why is broadband more expensive in the US?

Home broadband in the US costs twice as much as it does in Europe and three times as much as it does in South Korea, according to a new report. Why?

Because we let the duopoly get away with it, as Susan Crawford has been reminding us for a while now.

The price of basic broadband, TV and phone packages—or bundles as they are known—is much higher in American cities than elsewhere, suggests the New America Foundation think tank, which compared hundreds of available packages worldwide….

This research echoes the findings of another report earlier in the summer by the OECD, which compared countries in terms of their broadband-only prices. Across all 10 download speeds and capacities, it consistently ranked the US near the bottom.

For instance, at high speeds of 45 Mbps and over, the OECD report has the US ranked 30th out of 33 countries, with an average price of $90 a month. With phone and TV thrown in, plus some premium channels, these packages often cost $200.

As Susan Crawford puts it:

“We deregulated high-speed internet access 10 years ago and since then we’ve seen enormous consolidation and monopolies, so left to their own devices, companies that supply internet access will charge high prices, because they face neither competition nor oversight.”

Two-thirds get their broadband via their television cables, she says, because the DSL (digital subscriber line) service provided by phone companies over copper lines can’t compete with cable speeds, while wireless and satellite services are subject to low usage caps.

There are things local communities can do.

In Kansas City, Kansas, residents are enjoying a high-speed fibre network, supplied by Google, at a price of $70 a month for a gigabit (1,000 Mbps) internet-only service. And there’s a slower 5 Mbps download speed for free for seven years to those who pay $300 up front. Google now has Austin, Texas, and Provo, Utah, in its sights, too. Verizon also has a super fast fibre network, Fios, available to 10% of US households.

About 150 cities across the US have internet access supplied by public utility companies. In Chattanooga, Tennessee, electricity company EPB became an internet service provider four years ago. After expanding its existing fibre network which it used to control the grid, it now offers a one gigabit service for $70 a month.

The mere suggestion that we might want to do one of those things can be enough to get the duopoly to deploy something faster and less expensive. Or we could take up Susan Crawford’s suggestion of loan guarantees or wholesale requirements.

As Crawford previously reminded us all:

Not surprisingly, cost is the most commonly cited reason people in America do not subscribe to high-speed Internet access, and nonadoption is closely tied to economic status; lack of data access reinforces other inequalities. Meanwhile, the future of start-up businesses, independent programmers, the computing industry, the quality of life of many Americans, and free expression online are all in jeopardy; neither businesses nor people can count on fast, open access to new markets, new ways of getting an education, new ways of obtaining health care, and new ways of making a living.

There is now rigorous scientific research that shows that fast affordable Internet access has a causal relationship with income, jobs, and creative workers.

So our local leaders can either continue to define away the problem or stop hiding their heads in the sand and do something about it.

-jsq