The Cost of Connectivity 2020

Author(s): 
Becky Chao
Claire Park
Publication Date: 
Wednesday, 2020, July 1

The Cost of Connectivity 2020, a recent report from the Open Technology Institute (OTI) at New America, explores how much Americans pay for Internet access compared to those in other parts of the world.

After examining 760 broadband plans in 28 countries in North America, Europe, and Asia, the report's authors conclude that Americans pay higher fees for slower speeds, with communities of color and low-income households most affected. The report points to a lack of Internet service provider transparency and competition as reasons why costs are higher in the United States compared to other places. OTI found that municipal broadband networks, like the one in Ammon, Idaho, provide much better value to subscribers and offer some of the most affordable Internet plans in the country.

Some takeaways from The Cost of Connectivity 2020:

  • "[I]nternet service in the United States remains unaffordable for, and therefore inaccessible to, many low-income households . . . In April 2020, 43 percent of lower-income parents reported that their children will likely have to do homework on their cellphones, and 40 percent said that their children would likely have to use public Wi-Fi to finish schoolwork because they lack a reliable internet connection at home. The 'homework gap' also disproportionately affects students who belong to BIPOC communities."
  • "Just three U.S. cities rank in the top half of cities when sorted by average monthly costs. The most affordable U.S. city—Ammon, Idaho — ranks seventh."

  • "Data caps further increase the cost of internet service while limiting users’ data consumption . . . Furthermore, data caps can have anticompetitive effects on the wider ecosystem, especially if an Internet Service Provider (ISP) selectively applies data caps to preference its own content while deprioritizing competitors . . . Notably, most of the plans with data caps are in the United States. In Europe, all plans advertised no caps or did not specify. In Asia, only one city specified a cap."

  • "Consumers do not always read the (very) fine print to find the contract termination fees, and as a result are more likely to underestimate their switching costs — an important distinction when consumers are more likely to overestimate cost-savings from long-term contracts that are more visibly advertised."

Read The Cost of Connectivity 2020 or download the report on OTI's website.

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