Competition Breeds Lower Broadband Prices

The more broadband providers a consumer has to choose from, the less they pay, according to the latest Pew Internet & American Life Project poll on U.S. broadband trends. Other findings: Home broadband adoption as of the end of May stood at 63 percent, up from 55 percent in May of last year; more Americans have cut back on cell phone or cable service than Internet (though that could be a result of dropping premium add-ons from those plans); and 34 percent of broadband users pay to receive a higher tier of speed from their provider.

Getting back to competition, there is a statistically significant distinction in the price for monthly broadband when more providers are available in a particular area, even when accounting for premium services like AirCards and other factors:

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As for how they got their Internet service, the number of respondent that answered “fixed wireless or satellite” jumped to 17 percent from 11 percent last year. Pew notes that “the interviewer conducting the survey was permitted to prompt the respondent, for the wireless choice, about whether he had an AirCard service.” This may have generated additional “wireless” responses than the past. Fiber also made significant gains, with both coming at the expense of DSL.

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