Broadband in the US is Slower, More Expensive Than In Most OECD Countries

While the U.S. is the birthplace of the Internet, it currently falls behind other countries in making high quality broadband connections widely available.The OECD’s overview on broadband connectivity shows the U.S. provides costlier and lower quality broadband than other countries. Furthermore, the U.S. trails most other countries in percentage of people with broadband subscriptions.

internet 1 9The figure above illustrates the number of broadband subscriptions per 100 inhabitants in a series of high-income OECD countries. Switzerland tops the list, with almost 52 subscriptions per 100 residents. On the other end of the spectrum, only 31 percent of inhabitants have a broadband subscription in the U.S. The only country with a lower broadband subscription rate is Japan, at 30 percent.

However, a breakdown by type of broadband reveals that in Japan three-quarters of broadband subscriptions are for fiber optic connections, the fastest type of broadband available. Thus Japan is almost at the top of the list in terms of fiber optic subscriptions — 22 per 100 inhabitants. South Korea has the most fiber optic subscriptions — 28 per 100 residents. In the U.S., only 3 percent of people are subscribed for fiber optic broadband.

internet3 1 9Internet in the U.S. is not cheap either. In the above figure we can see that even adjusted for Purchasing Power Parity (PPP), the US has the highest prices per megabit of advertised speed. In the U.S., one megabit of speed costs 60 cents, while in the U.K., Germany, and Canada it is around 30 cents. In Japan, one megabit of advertised speed only costs 2 cents. Using data collected from speed tests conducted by Akamai Technologies, the OECD also offers insight into the average connection speed in these countries.

internet2 1 9The figure above illustrates the average connection speed as measured by tests conducted by Akamai Technologies. The tests found that South Korea has the fastest internet, at an average of 24 megabits per second (Mbps), followed by Japan with an average of 15 Mbps. Internet speed in the US ranks somewhere in the middle, with the average connection at 10 Mbps. The lower number of broadband subscriptions is not surprising given that people in the U.S. pay more than those in most other countries for worse service. The fact that 3 percent of people do not have access to any internet providers, 9 percent can choose from only one provider, and 32 percent between two providers probably isn’t creating many incentives for internet providers in the U.S. to offer better services at lower prices.

This article originally appeared on CEPR

About The Author

Lara Merling is a member of the first class of graduate students at the Levy Economics Institute, where she obtained her M.S in Economic Policy and Theory in 2016. Lara holds a B.A in Mathematics from Bard College, where as an undergraduate student she became interested in economics and social justice. Her research interests are centered on promoting economic ideas and policies that directly address inequality and advocate for better labor practices. Lara has previously worked at La Voz del Valle de Hudson and the Worker Justice Center of New York.

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