Why Americans Pay More for Internet


Why Americans Pay More for Internet

New York Times attempts to explain why Americans pay more for the internet – but get less in return.

Why the U.S. Has Fallen Behind in Internet Speed and Affordability

America’s slow and expensive Internet is more than just an annoyance for people trying to watch “Happy Gilmore” on Netflix. Largely a consequence of monopoly providers, the sluggish service could have long-term economic consequences for American competitiveness.

Downloading a high-definition movie takes about seven seconds in Seoul, Hong Kong, Tokyo, Zurich, Bucharest and Paris, and people pay as little as $30 a month for that connection. In Los Angeles, New York and Washington, downloading the same movie takes 1.4 minutes for people with the fastest Internet available, and they pay $300 a month for the privilege, according to The Cost of Connectivity, a report published Thursday by the New America Foundation’s Open Technology Institute.

The report compares Internet access in big American cities with access in Europe and Asia. Some surprising smaller American cities — Chattanooga, Tenn.; Kansas City (in both Kansas and Missouri); Lafayette, La.; and Bristol, Va. — tied for speed with the biggest cities abroad. In each, the high-speed Internet provider is not one of the big cable or phone companies that provide Internet to most of the United States, but a city-run network or start-up service.

The reason the United States lags many countries in both speed and affordability, according to people who study the issue, has nothing to do with technology. Instead, it is an economic policy problem — the lack of competition in the broadband industry.

“It’s just very simple economics,” said Tim Wu, a professor at Columbia Law School who studies antitrust and communications and was an adviser to the Federal Trade Commission. “The average market has one or two serious Internet providers, and they set their prices at monopoly or duopoly pricing.”
–Claire Cain Miller | NYTimes.com

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5 thoughts on “Why Americans Pay More for Internet

  1. It’s time that a our new Congress take up this issue and press the Attorney General to begin a lawsuit for monopoly against the current giants of the internet industry as an opening gamit in this modern age against all the new technology that have similar monopolistic practices. It seems a natural for any ambitious Congressman/Senator who would like a cause to unite the public against the greed we have witnessed this last decades. Consumer Reports has already taken up the cause and we need more people writing their representatives, particularly the new ones who can well use a common cause.

  2. I have seen various theories on the reasons behind the US’s useless internet service. A regular one is that the cable companies have monopolies in various areas. As they sell an “entertainment” package rather than a communication service, what is in it for them to give people fast internet?

    Elsewhere it works the other way round, you buy an internet service and then add entertainment to that, if yoiu feel so inclined.

    In general, this article is hopelessly vague. I feel sure that the NYT has done better coverage of the issue than this piece. Indeed, it looks more like a “nib” than a proper report. Either that, or it was written by an unpaid intern.

    Here in the UK, we are somewhere in the middle of the global league table. Monthly rates are $30 to $40 for unlimited access, often plus line rental. Competition is such that we now have cable companies (Sky) vying with telecom suppliers (BT) to offer broadband. And wireless operators are muscling in.

  3. I am using the latest Windows 10/9860 and having gone thru the rather complex regedit process to set Tcp 64240 I find no change in internet speed from the default value (50bps on Virgin)

    • @Gino: I am using a 2001 metal tower with motherboard and memory from a garage sale “$4 bargain”, and ATI $20 video card. I have a $8 gigabit ethernet card wired to a gig router, that distributes a 50 MB internet service that costs $70 a month (recent $2 a month bump in price, speeds have jumped to 89-95 MB). I tested a win7 system today, was getting 74 MB wired, 73 wireless. Booted same laptop system with Linux on a flash stick 92 MB wired, 94 MB wireless.

      Tonight running a mid weight Linux system (MX-14.2), from a 4 Gig flash drive and no hard drive, my speed test: http://www.speedtest.net/my-result/3895256701

      This last June, visiting a friend in Japan and they consistently tested over 100 MB up and down with win7 or Linux on a flash drive. This internet speed is costing them 30,000 Yen, $30 US Dollars each month.

      It costs me twice the money for 10% less download speed, and a throttled upload speed to slow to compared. Her family house has a 1 gig service for 50,000 yen or $50 dollars a month.

      It is my belief that Corporations are fostering short term profit greed, and that is destroying this country.

      Also media consolidation is a major reason for part of this high priced slow technology release for business & consumers.

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