December 16, 2024
Steep Price Declines Sharply Contrast With 32.2% Inflation Since 2015
Accelerating Speeds and Lower Prices Dramatically Expand Consumer Purchasing Power
WASHINGTON, D.C. (December 16, 2024) – Today USTelecom shared some much-needed good news this holiday season with the release of its annual Broadband Pricing Index (BPI) showing that prices for consumers’ most popular broadband service choices declined by 9.4% over the past year.
“An intensely competitive broadband marketplace is delivering big-time for American consumers and our innovation economy,” said USTelecom President and CEO Jonathan Spalter. “This competition and broadband companies’ investment in modern infrastructure is driving powerful efficiencies and lower prices with benefits that extend from the global reach of U.S. competitiveness to the hyper-local reality of household budgets. Broadband companies are all in on modernizing U.S. innovation policy to unlock and unleash the full potential of broadband across our nation.
In this report, the BPI-Speed metric tracks pricing trends for service offerings between 100 Mbps and 940 Mbps. Consistent with the forward march of consumer choices and broadband infrastructure investment, the association today also launched a new BPI-Gigabit metric, which tracks pricing trends for broadband services from 940 Mbps to 1 Gbps.
Combined, the two categories cover more than 80% of U.S. broadband customers, with 55.4% choosing service in the BPI-Speed range and 25.1% now electing gigabit service as of December 2023, according to the most recent FCC internet access services data.
Regardless of which category of service broadband consumers choose, today’s competitive marketplace is delivering tremendous value. Among the key findings:
BPI-Speed
- Real (inflation-adjusted) prices for the most popular broadband service offerings (between 100 Mbps and 940 Mbps) declined 9.4% year over year.
- Since 2015, real BPI-Speed prices are down 59.9%.
BPI-Gigabit
- Real prices for service offerings between 940 Mbps and 1 Gbps are down 3.9% year over year and 21.4% since 2017.
Broadband Beats Inflation
- Broadband’s value is even more notable in comparison to overall inflation.
- As consumers struggled under the weight of a 32.2% rise in the cost of essential goods and services since 2015, nominal BPI-Speed prices dropped by 41%.
- Similarly for gigabit service, inflation took a 27.5% bite out of household budgets since 2017, while BPI-Gigabit prices declined by 21.4%.
Expanding Consumer Purchasing Power
- Further fueling consumer purchasing power, as prices declined, upload and download speeds for broadband have dramatically accelerated.
- Since 2015, download speeds for the most popular consumer broadband services (BPI-Speed) increased by 113.5%, while upload speeds increased by 88.5%.
- The combination of lower prices and faster speeds delivered an 81.2% reduction in the cost per megabit of broadband connectivity from $0.87 to $0.16 over the past nine years.