Better Broadband Better Lives

The Cost of Connectivity: An Analysis of the Open Technology Institute Report Cited by the White House

in Broadband's Impact by

WASHINGTON, January 14, 2015 — The White House’s recent report on “Community-Based Broadband Solutions” relies heavily on an Open Technology Institute report from the fall that compared the quality and cost of U.S. broadband Internet with the rest of the world.

The third annual Cost of Connectivity report from OTI, the technology program of the public policy institute New America Foundation, compared the prices, speeds, data caps and other fees of both home and mobile broadband in 24 cities from around the world.

“Our findings remain consistent: the majority of U.S. cities included in our report lag behind their international peers,” according to the report.

The report is consumer-facing, focusing on what consumers would actually pay for the advertised speeds in the respective cities. Other broadband reports analyze market trends, differences in economic and political systems, levels of federal and private investment, and compare advertised speeds to actual speeds. The findings of this report simply show the current state of broadband in cities across the globe.

As Business Insider quickly pointed out, OTI’s reported showed that San Francisco has the slowest speeds of any major U.S. city, coming in 20th out of the 24 cities. Yet the ISP Webpass offers a plan with 200 Mbps symmetrical connection (equal download and upload speeds) for $30 a month. The cost of that plan makes San Francisco the most affordable city in the U.S. for fast broadband for under $40.

Vice used the report to generalize about the poor state of broadband nationwide after it first compared Los Angeles and Seoul, saying “the internet in Los Angeles is half the speed of the internet in Seoul, and yet we pay ten times as much for it. The only cities in America that can even hold a candle to places like Seoul are Kansas City and Chattanooga, Tennessee, where the internet is fast but still twice as expensive.”

These reactions are understandable, as the findings of the report seem to be in line in line with the general sentiment that Americans have been reading about for months, even years: that U.S. broadband is not only slower than its international peers, but the cost to connect is also much higher in the U.S. However, Kehl made it clear that the report findings should not be generalized to a nationwide level.

“We make it clear that it is a city comparison,” Danielle Kehl, one of the experts behind every Cost of Connectivity report told Broadband Breakfast. “It tends to get covered much more as the U.S. is lagging behind the rest of the world and a country comparison. We are very conscious of the fact that it is a city comparison and that its not U.S. versus Germany, but Washington, D.C. versus Berlin.”

The report also notes why a city-to-city comparison was used. “We compare specific cities in an attempt to address population density challenges that often skew comparative assessments of broadband in the U.S. vs. other European and Asian countries.” The significance of population density is tantamount, as it is an “important variable that helps dictate broadband speeds and prices.”

 

Rank

City

Continent

Population (City)

Land Area (mi sqaured)

Pop Density of City (people per mi squared)

1

Paris

Europe

2,249,975.00

40.7

55,281.94

2

Seoul

Asia

10,442,426

233.67

44,688.77

3

New York City

North America

8,175,133

302.60

27,016.30

4

Taipei

Asia

2,693,672.00

104.94

25,668.08

5

Delhi

Asia

11,007,835.00

431.09

25,534.89

6

Bucharest

Europe

1,883,425.00

88

21,402.56

7

Mumbai

Asia

12,478,447.00

603

20,693.94

8

Sao Paulo

North America

11,895,893.00

591.78

20,104.00

9

Jerusalem

Middle East

890,428.00

48.32

18,426.59

10

Hong Kong

Asia

7,234,800

407

17,775.92

11

Copenhagen

Europe

579,513.00

33.28

17,413.25

12

San Francisco

North America

805,235

46.69

17,246.41

13

London (Inner London)

Europe

3,335,438.00

198.40

16,811.89

14

Tokyo

Asia

13,185,502

844.66

15,610.43

15

Mexico City

North America

8,851,080.00

573.00

15,446.91

16

Madrid

Europe

3,236,344.00

233.89

13,837.03

17

Boston

North America

645,966

48.42

13,340.89

18

Amsterdam

Europe

813,562.00

64

12,711.91

19

Dublin

Europe

527,612.00

44.40

11,883.15

20

Chicago

North America

2,695,598

227.2

11,864.43

21

Zurich

Europe

383,708.00

33.93

11,308.81

22

Toronto

North America

2,615,060.00

240.00

10,896.08

23

Washington, DC

North America

646,449

61.40

10,528.49

24

Berlin

Europe

3,517,424.00

344.35

10,214.68

25

Shanghai

Asia

24,150,000.00

2,448.10

9,864.79

26

Los Angeles

North America

3,884,307

503.00

8,282.00

27

Prague

Europe

1,243,201.00

192

6,475.01

28

Riga

Europe

701,977.00

117

5,999.80

29

Lafayette, LA

North America

120,687.00

49.1

2,457.98

30

Kansas City, MO

North America

459,787.00

314.95

1,459.87

31

Bristol, VA

North America

17,835.00

13.2

1,351.14

32

Chattanooga, TN

North America

173,366.00

135.2

1,282.29

33

Kansas City, KS

North America

145,786.00

124.811

1,168.05

Cities in regular fonts were used in the original report, bold and italic cities were added for comparison

Using this logic, the best comparisons are between or among cities with comparable densities. Seoul’s population density is so much greater than any other city in the report that it is an outlier. A better comparison would be between Los Angeles and Berlin, or among Amsterdam, Zurich, Los Angeles, Berlin, Dublin and Prague.

Best Home Broadband Deals Under $40

 

City

Provider

Monthly Broadband Price

Download

(Mbps)

Upload

(Mbps)

Density

Berlin TeleColumbus

$37.18

64

3

10,214.68

Dublin UPC

$36.59

60

6

11,883.15

Toronto Teksavvy

$36.25

30

5

10,896.08

Los Angeles Sonic.net

$39.95

20

2.5

8,282.00

Zurich UPC

$32.37

20

2

11,308.81

Prague O2

$37.41

20

2

6,475.01

Los Angeles seems to be holding up just fine against the cities with comparable densities. It should be noted that the data used for Los Angeles and New York in this comparison is not the same as used in the official report. Two simple Google search revealed that Sonic.net and RCN provided faster speeds than what was used in the chart. For the most part, cities with comparable densities have similar speeds and prices.

City to City Data

While the Cost of Connectivity helps to fill in the gaps left by other more technical reports, the report does not include mobile phone data plans, only home broadband and mobile broadband from USB dongles and Wi-Fi hotspots. The cost of those plans frequently include non-broadband related services like voice and text.

“There is a lot value in that research and we’d love to do it or see someone else do it,” Kehl told Broadband Breakfast. “In terms of the scope of this report, we decided to focus it on [accessing the Internet on a personal computer or tablet].”

While the Open Technology Institute report did not include mobile phone plans in their comparison, it did include the connection prices and speeds of mobile broadband of portable Wi-Fi hotspots and USB dongles. Examining the available dataset shows that 3 of the 4 US carriers lack any upload and download speeds. OTI told Broadband Breakfast that the data for the speeds was not publicly available. While the websites of AT&T, T-Mobile and Sprint do not display speeds, a live chat with a customer support representative quickly provided some missing details.

Missing data was not limited to U.S. carriers. Data on Canada’s Bell mobile broadband network can be found on their website Two out of the five Hong Kong carriers lacked data on speeds, and three of five Dublin carriers lacked that information.

American Trends

The report surveys relatively few cities with the highest tier of broadband. Other incumbent ISPs, regional ISPs and municipal ISPs nationwide have been building out fiber and increasing the speeds. CenturyLink announced seven new cities in which it will offer 1 Gbps upload and download speeds to residents in addition to the three cities — Las Vegas, Salt Lake City and Omaha — where it already provides the service.

New entrants like Google Fiber have sparked the competition to provide faster and cheaper broadband speeds. When Google announced it was bringing its fiber service to Austin, Texas, incumbent AT&T announced GigaPower service, which will increase the top home broadband speeds from 300 Mbps to 1 Gbps, to match Google’s speeds.

While not many U.S. cities can boast 1 Gbps up and down for around $40 or less like Hong Kong and Seoul, the U.S. is a substantially larger any other country surveyed in the report. In addition, many smaller cities and rural areas are getting the gigabit treatment. Residents of Brentwood, CA, which is right outside of San Francisco, are getting 1Gbps + voice for $40 a month from ISP Sonic.net, and will be expanding to San Francisco in the future. Verizon Communication’s Fiber Optic Service recently announced its move to provide symmetrical upload and download speeds on all of its plans.

A New Hope

Demand for faster, more reliable broadband is not only growing in the U.S., but it will be necessary in order to take advantage of newer, broadband-dependent technologies in the realms of education, health and business. This demand has drawn both private and government investment in laying fiber and building the infrastructure necessary for future-proofing American broadband. Coalitions such as the Schools, Health and Libraries Broadband Coalition have been formed to advocate for more federal funds, to help bring together ISPs and communities and to overall help the expansion of next generation networks. In rural and suburban communities where competition seems to be lacking, municipalities have worked to create affordable alternatives.

These efforts have not been in vain, as the Federal Communications Commission has made changes in the agency’s plan to increase the E-rate fund for schools and libraries. Now, President Obama’s push to support community-led Gigabit Networks could open up new super-fast options for cities in the United States.

 

Leave a Reply

Your email address will not be published.

*

Latest from Broadband's Impact

Go to Top