the internet has become a crucial part
of everyday life but often it can feel
like your connection is too slow and too
expensive i've seen it dip to about one
megabit per second and that usually
happens right around the time i have to
download a huge file for work open
technology institute's research confirms
the frustration people in the u.s pay
more for slower internet than people
abroad so for many consumers the cost of
getting online right now is simply too
high and also too complicated and there
are a lot of stakeholders adding to the
confusion it's not like you just connect
a wire to your house and then you have
magic access to the cloud it takes a lot
of
infrastructure and wires and cables and
networks to get data from your house to
the rest of the internet our wi-fi is
run through the company that owns this
apartment we don't get to see what our
wi-fi speed is supposed to run at or
alter our
plan at all really have no idea how
pricing for internet service works in
this country we don't really know what
will show up on our bill at the end of
the month given the kinds of fees that
companies can lobby on us at the same
time there are still americans who lack
access to affordable reliable broadband
one of the striking differences that's
persisted over time is that people in
the suburbs are much more likely to have
internet access than broadband access
than rural residents lawmakers are
trying to address the issue for a long
time infrastructure policy didn't
include internet access but new
legislation shows that perspective is
shifting the us senate passed the
infrastructure investment and jobs act
in august 2021 which includes 65 billion
dollars to expand high-speed internet
access but the house of representatives
has yet to vote on the bill and even if
there is change coming from washington
it'll take a long time for that to reach
our computers and routers
here's why so many americans lack access
to high-speed internet why those who can
get it are paying more for slower speeds
and some ways policymakers can fix it
the cost of high-speed internet in the
us is difficult to measure the
government does collect some cost data
but it's incomplete it's not perfect
the government also tries to collect
access data
that is also incomplete
i think the fcc has been under a lot of
pressure to get this right
and i think that there are some good
smart people at the agency working on
this but we don't have it yet some
researchers are working to fill the gap
in the data the open technology
institute or oti has been studying the
price and speed of internet services
advertised within the united states as
well as abroad
we found that the current average
advertised monthly cost of internet in
the united states is 68.38
so almost 70 which is higher than the
average price of internet for all of
north america europe and asia and we
also found that the higher costs don't
necessarily translate to faster internet
people in the us pay more for slower
internet than people abroad so for many
consumers the cost of getting online
right now is simply too high and also
too complicated one thing that's
difficult about comparing prices in the
united states is that
different geographic regions have very
different cost structures but it can be
very different to deploy broadband in
downtown los angeles as it is in montana
actual internet speeds are also
difficult to pin down and they sometimes
don't match advertise speeds there is a
system in place right now where
companies self-report the speeds that
they offer but oftentimes those speeds
that they report differ from the speeds
that consumers actually experience
another study out of berkeley law also
found inconsistencies when it came to
internet speeds
one town in minnesota one side of the
street you pay 50 bucks a month and your
download speed is 60 megabits per second
on the other side of the street
you pay the same price
50 a month your download speed is 3
megabits per second that's not enough to
stream live tv on hulu and so what we
find is that competition plays a big
role in improving consumers broadband
experience any number of folks we talk
to say that they've hunted around you
know they've looked for vendors they've
looked for opportunities to get
low-cost access and some of them have
just given up in frustration because
they don't feel like it's available
today our research has consistently
shown prices for internet service remain
high the federal government should be
the one collecting this data from
companies like how does the price change
how does this quality change year after
year
increasing availability to high-speed
internet can lead to economic growth
according to an april 2021 report from
deloitte it found that a 10 percentage
point increase in broadband access could
have resulted in more than 875
000 additional us jobs in 2014 as well
as 186 billion dollars more in economic
output in 2019. the report also found
that higher speed internet would likely
lead to quote noticeable improvements in
job growth when we ask americans about
the advantages of broadband what is so
clear from broadband users is that they
think
that broadband makes them better
citizens makes them better workers makes
them better consumers makes them better
political and civic actors makes them
better news consumers and they kind of
worry about the people who don't have
access to broadband that they aren't
necessarily full participants in all of
the dimensions of society a 2016 study
by the council of economic advisors also
found that improving access to broadband
leads to economic gains such as
improving labor market outcomes for
subscribers increasing economic growth
providing access to better health care
and enhancing civic participation some
of the striking things though that
happened during the pandemic though was
that as many many school children went
to remote learning we heard from a lot
of low-income families that their kids
were struggling because they didn't have
high-speed connections at home they had
to do homework on a cell phone they
often had to go outside the house to a
local spot to get access to wi-fi so
almost half of the low-income families
said that they were struggling with at
least one of those issues related to the
homework gap during the pandemic
stanford university's policy analysis
for california education has documented
how student learning has declined during
the pandemic especially among younger
children its research has also found
that low-income students were
substantially more likely to fall behind
than higher income students if someone
is is a
is still in in junior high or elementary
school you disrupt that her
his or her education you're never going
to really make up for that and then the
other thing is graduates who enter a bad
labor market we actually know about that
from a number of studies
suffer permanent damage to their career
prospects
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so there are several factors that
contribute to the high cost of internet
service in this country one of the most
important reasons is the near monopoly
in the marketplace the us market for
internet service is dominated by just a
handful of companies because of this uh
none of them feel any market pressure to
lower the cost or improve the quality of
their service at least 49.7 million
americans only have access to broadband
from one of the seven largest cable and
telephone companies according to an
analysis of the fcc's broadband
competition data by the institute for
local self-reliance or ilsr ilsr says
that at least 83.3 million americans can
only access broadband through a single
provider the report also concluded that
charter communications and comcast which
is cnbc's parent company and the largest
internet provider in the country
according to the fcc's data maintained a
monopoly over at least 47 million people
with their coverage spanning mostly
urban and suburban areas ilsr's analysis
found that roughly 52 million households
subscribed to either comcast or charter
charter told cnbc it's extending its
broadband network into quote unserved
and rural areas and it offers lower cost
options for eligible families and
seniors as well as different packages
for k-12 schools comcast did not respond
to cnbc's request for comment
competition makes a big difference
consumers that only have one choice for
broadband provider can pay five times
more that consumers that have the
benefit of competition the ilsr report
also says that quote big telecom
companies have largely abandoned rural
america data out of the pew research
center reflects a rural suburban divide
one of the striking differences that's
persisted over time is that people in
the suburbs are much more likely to have
internet access than in broadband access
than rural residents that gap has shrunk
over the years a lot more people in
rural areas now have home broadband than
had it uh 15 or 20 years ago but the gap
persists to compound that consolidation
there's also a phenomenon of landlords
making deals with internet providers to
exclusively offer that service to
tenants eliminating choice and consumers
ability to negotiate prices this can
happen even if the building is equipped
to hold multiple providers there is
actually
a recent proceeding now within the
federal communications commission that
is looking for a refresher on the record
on this issue but the case remains that
they've tried to ban these exclusivity
deals in the past but providers continue
to find ways to circumvent the rules
with new schemes to somehow share their
profits with landlords so that they will
have these exclusive deals for huge
apartment complexes that can have
tens of hundreds of residents oti points
out in its report that the fcc has tried
to ban these deals but isps have found
ways of circumventing the rules one
thing we see is that rate regulation
does offer you meaningful improvements
but it doesn't get us quite as far as
competition now the data suggests that
competition
is still the best means of improving the
consumer experience
but you know part of the reason might be
because the the regulations aren't
tailored to local regions or they're not
as strong as they could
researchers have put forward a number of
policy proposals that could increase
access to high-speed internet and make
prices more affordable for consumers
a top priority for many experts is
providing consumers with more options
so you encourage competition i think by
deploying money to new providers who can
build out new networks in underserved
regions
you stop consolidation i think by taking
a close look at mergers between
broadband providers or mergers between
broadband providers and vertically
affiliated entities like content
companies we need stronger regulatory
enforcement
for those sorts of murders both at the
fcc and with the anti-trust authorities
anytime that there's a huge merger or
acquisition on the books the government
can set standards
if you are a major company merging with
a company that has historically provided
a service for low-income households you
could keep a merger condition that would
ensure that low-income households
continue to have a
like lower price
option that they can afford to stay
online rate regulation is also a top
policy proposal among researchers rate
regulation
can cut those prices nearly in half
where you're served by a monopoly
rate regulation can
offer you meaningful improvements in the
prices you pay and the services you get
regulation is good for consumers
but not as good as competition
it takes a long time to build up
broadband networks these these are
large-scale infrastructure investments
and so we need to think about what we're
going to do for consumers who face high
prices
while we're waiting for competition to
arrive there are some options when it
comes to developing infrastructure at
the local level one is called municipal
networks municipal networks are networks
that are run by cities so operated by
municipalities and they can take a lot
of different forms some cities partner
with private companies or
also
utilities cooperatives to offer internet
service and others just build their own
networks in the case of cities that had
both municipal and private networks
municipal networks brought down the
average cost of internet in that city
they also often had some of the best
feeds in the nation as of september 2021
at least 18 states have legislation
restricting the use of municipal
broadband networks according to an
analysis from broadband now industry
lobbyists have argued that municipal
networks can stifle private competition
broadband activists say they're
necessary to get rural residents online
there have been reports that private
companies in the area private internet
service providers have spent thousands
to millions of dollars lobbying state
legislators to not allow these networks
to use the recent infrastructure package
that has been a discussion that recently
passed the senate formally had language
that would have legalized these networks
that language has now been dropped but
there is legislation like the community
broadband act that would legalize
municipal networks there are other
policy proposals to address the
inequality such as regulations to
require service providers to be more
transparent about pricing and other data
the federal communications commission
allows internet service providers to
self-report that data which can lead to
potential discrepancies between what
people actually experience so we
definitely want to see reform on that
part of data flexion the fcc has issued
rules
regarding broadband transparency
it was on the path to creating
what was called a broadband nutrition
label which was sort of a way of very
transparently just playing okay here's
how much you're paying here's the speed
you're going to get here's the discounts
that you have here's how long those
discounts will survive for
but these regulations can come and go
with the changes of administration the
issue of affordability affects everyone
regardless of where they live right if
you can't afford the high cost of
service you can't be online that's
whether you live in the middle of a city
or you live on a farm it doesn't matter
cost affects everyone so hopefully we
can really make it more affordable for
people
you