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Americans pay more for slower internet, study says

Study compares internet speed and affordability in 22 cities around the world. US cities don't rank too well.
Internet speed 07 23 12Enlarge
A PTT employee explains to a customer about subscribing to the new high-speed internet service at the post office in Hanoi, 01 July 2003. Vietnam's Data communication Company launched 01 July a new high-speed Internet service in three main Vietnamese cities namely Hanoi, Ho Chi Minh-City and the northern port city of Hai Phong. The Asymmetric Digital Subscriber Line (ASDL), whose maximum charge is fixed at 75 US dollars a month, can provide 24 hours access at a speed up to 40 times faster than a traditional 56 bps modem, on a standard analog phone line. (Hoang Dinh Nam/AFP/Getty Images)

Americans pay more money for slower internet speeds than the majority of the rest of the developed world, according to a report published by the New America Foundation, a US based non-profit public policy institute.

“The results add weight to a growing body of evidence that suggests that the US is lagging behind many of its international counterparts, most of whom have much higher levels of competition and, in turn, offer lower prices and faster Internet service,” the report says.

The report compared high speed broadband products in 22 cities around the world. Included are comparisons of the fastest available internet speed in each city, a survey of the best available internet speeds $35 could buy, and “triple play” packages bundling internet, phone and television.

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Among major citires, the report looked at New York, Los Angeles, Paris, Copenhagen, Prague and Tokyo.

In many examples, Americans weren’t just paying a few dollars more — they were sometimes paying double their foreign counterparts. In Paris, a consumer will pay $35 for a 100 megabits per second (Mbps) bundle of television, internet, and telephone. A resident of Lafayette, LA will pay $65 for the same package with just 6 Mbps. Even more expensive, Verizon charges New York City customers $154 for their least expensive “triple play” bundle.

Hong Kong has the fastest available internet connections for the cheapest prices, the report says, offering a 500 Mbps download speed for $37. Tokyo is second with $26 for a 200 Mbps download speed. 

San Francisco, a leading city in internet speed and affordability, offers 200 Mbps download speed for $37, third among all cities it was compared to. San Francisco is also leagues ahead of internet speed and price in other US cities surveyed, like Chattanooga, Tenn. where $25 only earns 6 Mbps.

The US managed to tie for first among the other cities surveyed in fastest internet speed available with Chattanooga boasting a full 1 gigabit per second download and upload speed. However, the same speed in available in Hong Kong for $48, while a Chattanooga resident will have to fork over $317 for those speeds. 

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The New America Foundation cites poor policy as the reason why the US lags so far behind other developed countries in internet speed and affordability, forcing competition among ISPs out of US cities.

“Rather than focusing on spectrum auctions and the promise of wireless broadband, policymakers need to address the lack of competition in most of the US and how policies can enable new competitors to enter the marketplace,” the report says. 

The future for America’s internet doesn’t look bright, either. With high barriers to entry in the telecommunications market, competition for leading US ISPs will be absent. 

“In the future, consumers wishing to subscribe to higher speed internet services will likely face a near-monopoly from cable providers, as telephone providers have halted wide scale upgrades of their networks,” read the report. 

With little hope for future improvement, the best option for American consumers is probably to move to Hong Kong and enjoy that 1 Gbps speed for only $48 over some Dim Sum.

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http://www.globalpost.com/dispatches/globalpost-blogs/the-grid/us-internet-speeds-prices