Americans Pay Much More for Broadband Internet than Users in other Developed Countries

Tuesday, October 29, 2013

High-speed Internet costs consumers considerably more in the United States, which deregulated its industry a decade ago, compared to Europe and other developed nations.


Broadband services for American homes can be nearly three times more expensive than those in the United Kingdom and France, and more than five times as much as in South Korea, according to a comparison of services by the New America Foundation.


And it’s not just premium high-speeds that put the U.S. so much above other countries in terms of cost.


Lower to medium broadband services can average $99 in San Francisco and $70 in New York City, compared to $38 in London, $35 in Paris and $15 in Seoul.


“Americans pay so much because they don’t have a choice,” Susan Crawford, a former special assistant to President Barack Obama on science, technology and innovation policy, told BBC News.


“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,” she added.


This view is supported by a report produced by the International Telecommunication Union (ITU), which cited the fact that there are two key players in the U.S. market—AT&T and Verizon. That market structure, wrote The Economist, is one of the reasons that “rates are surprisingly high in America, where 500 megabytes of pre-paid data a month costs $85, or 2.1% of GNI [monthly gross national income] per person.”


Another reason is “the fact that it costs more to build a network [in the U.S.] than it does in small, densely populated European countries,” said the publication.


The article also noted that “Austria has the world’s most affordable pre-paid mobile-broadband, when measured as a percentage of GNI per person. By this yardstick, mobile broadband is generally cheaper in developed countries.”

-Noel Brinkerhoff, Danny Biederman


To Learn More:

Why is Broadband More Expensive in the US? (by Tom Geoghegan, BBC News)

When in Roam… (The Economist)

ITU Releases Latest Tech Figures & Global Rankings (ITU)


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