California Dreamin' Up Roadblocks to Progress

 I still love to listen to the Mamas and the Papas singing California Dreamin' as much as the next person. But I confess I do tire of many of California's policies which, if not by intent, then at least by design, are obstacles to progress. 

A case  of obstruction in point: The lengths California appears willing to go to impede modernization of the nation's telecommunications networks.

 

With the build-out of data centers and rapid advent and use of AI platforms, the incredible growth in 5G (and coming 6G) wireless services, deployment of drones, and myriad other technological developments, there shouldn't be much debate that it is in the nation's interest to facilitate the ongoing modernization of its telecommunications networks. And, in many quarters of the country, there is widespread agreement on this point.

 

But – shock, shock! – then there is California. The state is willing to go to extraordinary lengths to thwart the FCC's policies which are intended to allow telecom providers to invest in modernizing their networks by upgrading to digital (IP) technologies while, at the same time, protecting consumers during a transition period away from legacy copper lines.

 

For much longer than should be necessary, AT&T has been battling California's attempt to thwart its network modernization efforts as the state attempts to use its outdated "Carrier of Last Resort" (COLR) regulations to prevent AT&T from discontinuing POTS ("plain old telephone") copper line-based service. It is doing this in places where consumers have comparable IP-based alternatives available. By requiring that legacy copper-based POTS services continue to be maintained in place, this necessarily means that AT&T has less funds available for upgrading and modernizing its network to offer IP-based services over advanced broadband networks.

 

Here at FSF, we have vigorously supported the FCC's various efforts to revise its policies to facilitate network modernization, including the agency's Accelerating Network Modernization decisions. And we recently filed commentsand reply comments in the FCC's current proceeding considering AT&T's request for the agency to preempt California's COLR regulations.

 

In short, California is running a shell game in which, in theory, it purports to allow carriers like AT&T to discontinue copper-based legacy services if comparable basic services are available to consumers over any technology. But even though California claims its policy is "technology neutral," as FSF explained in its reply comments supporting AT&T's preemption request, the reality is much different.

 

[The California PUC] wrongly clings to the fiction that 'California does not require carriers to maintain copper facilities,' a claim belied in practice. The CPUC's convoluted, multilayered definition of 'basic service' effectively requires a copper line network; no other carrier is willing to step into AT&T's COLR shoes, and understandably so; ergo AT&T cannot retire its copper line network even with FCC approval to do so.

 

The FCC recognized in its Network Modernization Order that it's time for practical realities to prevail over fictions that impede IP-based network modernization efforts able to benefit all of California's consumers. As Free State Foundation scholars have long suggested, in today's multi-platform competitive communications marketplace, the whole notion of a 'carrier of last resort' is a fiction that needs to be buried.

 

AT&T has been forced to file a lawsuit in federal court seeking to prevent California, contrary to the FCC's network modernization policies, from requiring AT&T to continue offering copper-based POTS. As AT&T explains in its latest pleading, California continues its intransigence under the color of its COLR regime.

 

Congress gave the FCC the exclusive authority to authorize these service changes. So under the Supremacy Clause, California cannot undo or add to AT&T’s federal approvals. California disclaims doing so. It insists that its rules are technology neutral' and that AT&T is free to stop offering POTS to new customers (what the FCC calls 'grandfathering') and ultimately to discontinue POTS. As a result, California says, there is no conflicting state regulation for federal law to preempt and accordingly nothing for this Court to decide.

 

But California’s insistence that AT&T may wind down POTS is paired with a series of punishing caveats. AT&T may retire POTS so long as it gets several state permissions first—permissions that California insists are merely ministerial but are anything but. AT&T may retire POTS so long as it offers an alternative under California standards that are more onerous than the federal standards. AT&T may retire POTS so long as it substitutes a different service with features that the CPUC concedes are obsolete, and that AT&T’s modern services do not offer. AT&T may retire POTS so long as it tariffs the replacement, which federal law forbids. Scratch the surface, and none of these conditions is truly neutral. Together, they are a mandate to keep providing a service that the FCC has authorized AT&T to stop.

 

Let's hope AT&T prevails. Not just for the sake of AT&T. Not just for the sake of California's consumers who will benefit from modernization of AT&T's telecommunications facilities in California by virtue of access to advanced services. But also, more broadly, for the sake of preserving the FCC's network modernization policies, including the exercise of its preemption authority, throughout the nation.

Price Regulation Is Not the Answer for Broadband

By Randolph May and Joseph Kennedy

 

In a recent blog posting on the Benton Institute’s Digital Beat, Christopher Ali, the Pioneers Chair in Telecommunications at Penn State University, called for consideration of rate regulation for broadband providers. His main argument is that some households still have difficulty paying their Internet bill. That may be true for some in the short-term. However, the best way to ensure lower prices and greater innovation for the most consumers over the long-term remains continued promotion of increased competition with market-determined prices.

There is considerable evidence showing a steady pattern of increasingly faster speeds and lower prices per megabyte per second over the last few years. In other words, on average, consumers are paying less for more broadband capacity. Rate regulation almost certainly would reverse this.

Long periods of telecommunication history in the past were characterized by stagnant prices and low innovation because regulators treated the underlying transmission facilities as fixed assets that could only handle a limited amount of traffic. During this earlier monopolistic era, regulators aimed to guarantee providers a fixed rate of return on their investments and discouraged competition from new technologies.

As Ted Hearn points out in Policyband, Professor Ali does not acknowledge the large number of current market promotions reducing prices. Comcast, for example, is offering 300 Mbps for $40 a month and guaranteeing the price for five years. Mediacom is selling a broadband-mobile bundle, guaranteed for two years. Both are significantly lower than the $78 median monthly bill that Ali cites. It may be that the average user prefers to pay more for more capacity rather than lower fees for less bandwidth. However, federal programs and state universal service subsidies specifically target low-income consumers that may have difficulty paying their bills, along with offerings by individual providers targeting low-income consumers.

Professor Ali also does not mention the growing broadband competition from satellite constellations such as Elon Musk’s Starlink. It and other companies are aggressively targeting new customers with their high-speed broadband offerings, especially those in remote areas where fiber installation is extremely expensive. Price competition from satellites recently helped the National Telecommunications and Information Administration lower the overall cost of its Broadband, Equity, and Access Program by $21 billion. Much of these savings will be poured back into the BEAD program’s efforts to extend broadband to the remaining unserved locations in the country.

As Professor Ali points out, the public debate on price regulation has been more or less settled, at least for now. Over the last several decades, a number of markets thought to be natural monopolies, including those involving freight trains, airlines, electricity transmission, and Ma Bell-era communications facilities have faced fewer regulations and greater competition. Instead of low-risk regulators limiting new sources of competition and innovation, consumers now benefit from new market entrants offering new products and lower prices.

This is certainly not the time to renew efforts at rate regulation as the broadband marketplace becomes ever more competitive. 

FCC Simplifies Its Broadband "Nutrition" Labels

On July 22, the Commission adopted a Report and Order modifying its broadband "nutrition" label rules. According to the News Release, these changes "mak[e] [the labels] a more useful tool for consumers and reduc[e] compliance burdens on providers." They also bring those rules into better alignment with their authorizing congressional language.

2021's Infrastructure Investment and Jobs Act directed the Commission to "promulgate regulations to require the display of broadband consumer labels, as described in the Public Notice of the Commission issued on April 4, 2016 (DA 16–357), to disclose to consumers information regarding broadband Internet access service plans" (emphasis added).

"GFiber FCC Broadband Label" by Wikimedia Commons user JBoots07 is licensed under CC BY-SA 4.0.

But as I cautioned in a Perspectives from FSF Scholars published prior to the adoption of the original rules in November 2022, various commenters would have the agency ignore such statutory guardrails and instead "overload those labels with extraneous information intended to advance unrelated policy agendas rather than facilitate broadband comparison shopping."

Regrettably, the FCC at that time did not embrace my concerns.

The item adopted on July 22, however, addresses that overreach – and at the same time renders the labels more useful for consumers and less burdensome for ISPs. As the News Release underscores, the "initial broadband label rules … resulted in sometimes-confusing labels that strayed beyond the statutory framework Congress created, increasing compliance costs for providers in the process."

Among other things, the updated rules:

• Allow customer service representatives to communicate information contained in the labels conversationally rather than requiring them to read the labels word for word;

• Ensure "that consumers have … clear, accurate, and concise information about broadband plans, making the labels a more useful shopping tool";

• Eliminate obligations to provide outdated information, such as references to the since-discontinued Affordable Connectivity Program;

• Allow providers to "use links or icons at point-of-sale to avoid unwieldy amounts of information that can overwhelm consumers"; and, most saliently,

• Remove obligations that exceed the underlying statutory mandate.

In his Separate Statement, Chairman Brendan Carr assured that "[n]one of those changes come at the expense of transparency…. The result is a label that's easier for consumers to use, while reducing costs for providers. That's a win for everyone."

Congress and Regulators Should Follow NCTA’s Next Steps on AI-Driven Shortages

Surging demand for high-power AI chips is diverting scarce resources away from traditional chips that are used in broadband equipment. For example, the price of DDR4 memory – ubiquitous in broadband – has risen 700-800% year-over-year. NCTA – The Internet & Television Association has also emphasized that the problem extends beyond memory chips to substrate, the foundational materials on which chips are built.

An NCTA-led coalition of groups involved in deployment and operation of broadband services sent a letter on June 2 to Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick urging certain policy actions to expand chip production: “Ease constraints on alternative sourcing and product redesign by offering expedited validation and approvals for regulated products, along with flexibility for necessary hardware, firmware, or software changes. . . Identify and remove regulatory barriers that slow the expansion of memory manufacturing capacity, both domestically and internationally, to increase overall global supply.”

Promising policies under NCTA’s recommendations may include: streamlining regulatory and permitting requirements; reforming the Toxic Substances Control Act (TSCA) to speed up the review of new chemicals and substances necessary for innovation; allowing immediate expensing of foreign research and development costs; easing trade frictions by cutting unnecessary tariffs and customs barriers, expedite customs clearance procedures, and ensuring that semiconductor data can move freely across borders; and reforming high-skilled immigration for a robust workforce.

Broadband providers rely heavily on semiconductors to capture, process, and transmit data across their networks, making these shortages a direct constraint on their ability to operate, expand, and improve Internet service. And broadband providers are not alone. The coalition includes other sectors experiencing supply constraints, including automotive, medical technology, and retail associations.

State and federal policy responses to the shortages largely have relied on interventions in the form of grants, loans, and tax credits for domestic chip making and research. These interventions, like the 2022 CHIPS and Science Act, may indeed alleviate chip shortages but are subject to the typical flaws of government subsidies – they risk favoring selected companies and taxing Americans in the form of mounting government debt.

Encouragingly, there have also been some wins for more free-market oriented approaches to boost supply and slow the growth of increasing costs. In June, the FCC granted a waiver of certain router requirements that NCTA had petitioned for – I blogged about it here. The 2025 One Big Beautiful Bill Act restored expensing requirements for research and development (affecting all industries, not just chip-making). The OBBBA also let companies deduct the full cost of most new equipment and machinery in the year they buy it, particularly valuable for a capital-intensive industry like chip production.

Congress and regulatory agencies should build on NCTA’s recommendations and expand market-oriented approaches already supported by parts of the semiconductor industry, including the Semiconductor Industry Association.

Ultimately, persistent chip shortages translate into higher costs paid by consumers. When supply is stretched thin across industries, everyday products and services become more expensive – particularly in memory-heavy markets like broadband.

Congress and regulators must focus on finding market-oriented ways to bring these costs down for Americans.

The FCC Must Monitor State Regulation of Pole Attachments to Further Broadband Deployment

Pole attachments are attracting increased attention because of their importance to promoting the deployment of broadband facilities, including those financed by the Broadband Equity, Access, and Deployment (BEAD) program. As part of BEAD’s efforts to expand broadband coverage into all unserved and underserved areas, providers will have to obtain approval to work on millions of poles. The time and cost associated with this task will have a large effect on a project’s success in bringing Internet coverage to new households.

Last week the FCC’s Wireless Competition Bureau issued a Public Notice and Press Release regarding state regulation of pole attachments. The Notice informed states of their responsibilities for state regulation. These include:

•     Issuing rules and regulations implementing the state’s regulatory authority.
• Regulating rates, terms, and conditions of pole attachments.
• Establishing procedures for resolving disputes.

The Notice also requested public comments on how the FCC should ensure that state regulation is effective. This includes whether the Commission has a duty to review state certifications to ensure the regulatory regime is adequate to meet the requirements of the Communications Act of 1934. The FCC also seeks comments on what else it can do to ensure that attachers in state-regulated states are not subject to unnecessary costs and delay.

As I wrote in a previous blog, ownership and regulation of poles is not always straightforward. According to one study and analysis, pole regulation is “scattershot” and “highly fragmented.” Poles are owned by a number of different entities including utilities, local exchange companies, and government entities. Poles in many states are regulated by states, not the federal government.

The FCC regulates most poles under Section 224 of the Communications Act of 1934. Its rules lay out processes and timelines for attachers and pole owners when the former seek to attach communications infrastructure to poles. However, the provision gives states the option of “reverse-preemption” by certifying that they will regulate pole attachments in their state. As of now, 23 states and the District of Columbia have taken this option.

The FCC’s Notice is important because pole attachments can have a large impact on project cost and completion. According to the above study, BEAD-funded projects will touch an estimated 3,954,030 utility-owned poles across 2,053 electric utility service territories. Current plans are for aerial fiber to cover 188,287 miles. Pole-related costs for BEAD projects could range from $534 million to $4.63 billion. The authors find that many of the poles involved are not regulated by the FCC. It is clear that the availability of pole attachments on reasonable terms is important to furthering broadband deployment.

The Commission also seeks information on how it can improve the regulation of pole attachments in the states that have chosen to regulate attachments themselves. One way is to ensure that any adjudications are timely and effective. Delays in obtaining permits can have a significant impact on the cost and even viability of broadband deployments, including BEAD projects. This request is timely given the history of the dispute between Comcast and Appalachian Power Company. Appalachian Power sought to charge Comcast for the full replacement cost of damaged poles even when a portion of the damage was caused by third parties. Comcast demurred. The FCC quickly issued a judgment favoring Comcast. However, several months later the dispute is still delaying work. Both parties have filed documents alleging that the other party is not abiding by the judgment. Rulings that come late or that cannot be enforced will do little to address the problem.

Another possibility is to allow non-deployment BEAD funds to be used to give states the resources they need to provide effective permitting. BEAD funding represents a huge increase in the effort to extend Internet coverage. As the FCC notes, increased investment has led to extensive new deployments in recent years, resulting in a significant increase in pole attachment applications for large numbers of utility poles. Many states and localities may lack the personnel and experience needed to deal with this sudden increase in volume.

In conclusion, the FCC is wise to focus on the issue of state regulation. State rules should be essentially equivalent to FCC regulations to ensure that attachers in reverse-preemption states do not experience prolonged delays and unreasonable costs. As the Notice says: “[S]tate pole attachment regulation can either advance [ubiquitous deployment of next-generation broadband] through clear and effective rules or become a roadblock to such deployment if a state adopts a pole attachment regime that is incomplete or unclear or fails to adopt pole attachment regulations in the first instance.”

Broadband availability is closely linked to economic growth in a particular area. It benefits everyone when the regulatory reviews needed to effect deployment speed this benefit rather than delay it.

USTelecom's 2026 Broadband Pricing Report Sings a Familiar Refrain: Backtracking Prices and Surging Speeds

The latest broadband pricing report released by USTelecom | The Broadband Association (USTelecom) tells a familiar – and welcome – tale of falling prices and rising speeds.

Released on Tuesday and, as in previous years, prepared by Business Planning, Inc.'s Arthur Menko, "2026 Broadband Pricing Index: Faster Speeds, Lower Prices" (2026 BPI) analyzes data from 2025. It concludes that real (that is, adjusted for inflation) prices fell as speeds continued to climb. Specifically:

• PRICE: For the most-popular offerings (those delivering download speeds between 100 Megabits per second (Mbps) and 940 Mbps), the 2026 BPI reports that real prices dropped by 6 percent. The price of so-called "entry-level" plans – which provide download speeds between 100 and 249 Mbps and which USTelecom characterizes as "the most accessible tier for price-sensitive households" – reportedly decreased by an even greater margin: over 17 percent. According to the 2026 BPI, the price of gigabit (1,000 Mbps or greater download speeds) services fell nearly 5 percent.

• SPEED: The 2026 BPI concludes that subscribers to the most-popular offerings in 2025 saw speeds increase by nearly 22 percent – and since 2014, those speeds have increased by 145 percent.

Americans appear to recognize that the broadband value proposition hasn't merely improved but stands as a welcome outlier in comparison to other household expenses. According to a March 2026 survey of 1,500 likely voters conducted by Impact Research and cited in the 2026 BPI, only 2 percent of respondents identified the price of home Internet service as a top two cost concern, rendering it the least pressing of all surveyed categories, which included groceries, health insurance, housing, gasoline, and prescription drugs, among others.

It is important to note, of course, that none of this happens by accident. Thanks to the expenditure of tens of billions of dollars in private capital each year – according to an October 2025 USTelecom investment report, nearly $90 billion in 2024 and over $2.2 trillion total since 1996 – fierce competition among a diverse set of facilities-based providers increasingly delivers better service at lower cost.

In a companion blog post, USTelecom CEO Jonathan Spalter summarized the report in plain terms – "broadband internet service continues to deliver more value for less money" – and urged policymakers to ensure that those trends continue. Specifically, he identified copper retirement and permitting reform as two areas ripe for further deregulatory action.

As it happens, in comments filed yesterday regarding the Commission's next report on the state of competition in the communications marketplace, FSF President Randolph May and I made the same two points. We also identified the pole attachment "accelerated docket" and the spectrum pipeline as areas where the FCC can take steps to accelerate broadband investment and deployment.

Free State Foundation scholars have summarized every BPI report released by USTelecom. Posts to the FSF Blog addressing previous versions are available here: 2024 | 2023 | 2022 | 2021 | 2020.

Revised BEAD Program Connects its First Location

On November 15, 2021, the Infrastructure Investment and Jobs Act – that is, the legislation that created the $42.45 billion Broadband Equity, Access, and Deployment (BEAD Program – was signed into law. On May 14, 2026, 1,641 days later, BEAD Program funding at long last enabled the connection of its very location.

Of course, millions more locations are expected to come online in the coming weeks, months, and years.

In remarks offered on location in Ogallala, Nebraska, NTIA Administrator Arielle Roth highlighted the expediting impact of the "Benefit of the Bargain" revisions adopted last year. She also discussed changes designed to reinstate Congress' technologically neutral intent. In that regard, she noted that "[i]t's not an accident that this connection here in Ogallala is from an unlicensed fixed wireless provider."

Finally, a reminder: Ms. Roth will be a keynote speaker at the Free State Foundation's Twentieth Anniversary Celebration on Thursday, June 4, from 11:45am to 3pm, at the National Press Club. If you haven't already, register here to catch her fireside chat with FSF President Randolph May as well as an impressive lineup of other speakers.

Talkie's Preemption Petition Looks Persuasive - Part II

On March 12, I posted a blog titled, "Talkie's Preemption Petition Looks Persuasive." As I explained, in its petition Talkie asks the FCC to preempt Queen Anne's County in Maryland from enforcing what it claims are local zoning requirements that have the effect of prohibiting Talkie from attaching its communications equipment to a utility pole owned by Talkie. The county's purported justification for obstructing Talkie's proposed broadband service is that it would be delivered over multi-use (that is, comingled) facilities.

 

In my March 12 post, I concluded:

 

This is just one of many instances in which local cities and counties across the country implement onerous and often costly requirements, or engage in bureaucratic delay tactics, that prevent the timely deployment of new communications services and advanced broadband infrastructure. It's important that, when appropriate, the FCC grant meritorious preemption petitions. Talkie's petition looks like it may be just such a case.

 

While I hope that the Marylanders who might be served by Talkie proposed broadband service will not be denied that service because of improper actions by local officials, I'm also interested, of course, in the principle at stake in this particular preemption spat and other similar ones. That's why, in the above excerpt, I referred to "many instances" involving tactics similar to those confronted by Talkie in Maryland.

I'm pleased to see that INCOMPAS, representing a broad coalition of competitive communications providers and broadband builders, has submitted comments to the FCC supporting Talkie's preemption petition. INCOMPAS reports that its members "regularly

encounter discriminatory zoning requirements, excessive fees, sequential permitting processes, and de facto moratoria that significantly hinder broadband deployment."

 

INCOMPAS states that "the Commission has consistently preempted fees and requirements that disrupt deployment of advanced services over commingled facilities. The County’s opposition asks the Commission to retreat from that settled position, and INCOMPAS urges the Commission to decline to do so." Therefore, according to INCOMPAS, "the outcome of this proceeding will affect every INCOMPAS member deploying modern multi-use networks."

 

It is this potentially broader impact of the Commission's disposition of Talkie's preemption petition –aside from concern regarding the immediate impact on those residents who might benefit from having available Talkie's services – that prompted me to highlight Talkie's petition in the first place. Absent affirmative Commission action on Talkie's petition pursuant to Section 253 of the Communications Act, the ability to deliver broadband services over multi-use infrastructure could be put in jeopardy.

 

If that is the case, the full realization of FCC Chairman Brendan Carr's much-needed "Build America" agenda, which is necessarily dependent on rapid deployment of broadband infrastructure, could be adversely impacted. It still looks to me like Talkie has presented a persuasive case that should be given close attention by the Commission in a timely fashion.

 

Talkie's Preemption Petition Looks Persuasive

An item in today's Law360 Telecommunications newsletter, "Md. Gov't Agencies Oppose Talkie's FCC Preemption Bid,"caught my attention. [A subscription is required to access Law360.] The report involves a petition filed with the Federal Communications Commission by Talkie Communications, Inc., in January 2026, asking the agency to preempt Queen Anne's County in Maryland from enforcing what it claims are local zoning requirements that have the effect of prohibiting Talkie from attaching its communications equipment to a utility pole owned by Talkie.

According to Talkie, the county's bureaucratic permitting roadblocks are preventing it from providing voice, data, and cable services to Maryland residents and businesses. In recent years, Talkie has made significant investments to deploy its broadband services, including high-speed Internet services, in order to expand its competitive footprint.

 

Like many of the disputes between wireless and wireline communications providers and local authorities, there is a lot of back-and-forth, with assertions and counter-assertions. I haven't taken the time to independently investigate the facts of this dispute. But after reviewing Talkie's preemption petition, it looks to me like Talkie has presented a good prima facie case.

 

This is just one of many, many instances in which local cities and counties across the country implement onerous and often costly requirements, or engage in bureaucratic delay tactics, that prevent the timely deployment of new communications services and advanced broadband infrastructure. It's important that, when appropriate, the FCC grant meritorious preemption petitions. Talkie's petition looks like it may be just such a case.

 

The proper exercise of the Commission's preemption authority in a timely fashion is crucial to the full realization of FCC Chairman Brendan Carr's important, much-needed "Build America" agenda.

 

House Orders Study on How to Speed Approvals to Access Federal Land to Build Out Broadband Networks.

Over the past year there has been a growing emphasis on expanding public access to broadband services. Although actual progress is slow, planning and evaluation seems to have gained momentum. One aspect of this is a growing focus on the amount of time it takes government agencies at all levels to approve the use of federal lands to install broadband systems. Fortunately, some progress was recently made.

On March 3 the House of Representatives passed H.R. 5419 by a unanimous voice vote. The Enhancing Administrative Reviews for Broadband Deployment Act was originally introduced by Rep. Tom Kean (R-NJ). It requires the Departments of Agriculture and Interior to study whether there are any programmatic or administrative barriers to the timely review of requests to access federal land to deploy broadband. The study will also identify whether regulatory reforms could improve efficiency with respect to reviewing requests and try to identify processes for prioritizing the review of requests. Within one year the Departments shall issue a report summarizing the results of the study. It should also include a plan for providing the staffing necessary to ensure timely review of broadband land use authorizations in the future.

 A 2024 report by the Government Accountability Office found that between 2018 and 2022 the Bureau of Land Management and the Forest Service lacked sufficiently reliable data to determine whether they were meeting the statutory requirement of 270 days to process applications to use federal land to extend broadband coverage.

Permitting delays, for whatever reasons, add directly to the cost of deploying broadband projects. Thus, any actions to shorten approval times have a significant effect on economic growth. Such actions by Congress are welcome and show that, even in an atmosphere of strong partisan dialogue, it is still possible to find bipartisan support for policies that improve American life.

Internet Prices for Highest Speeds May Be Up, But So Is Quality for All Plans

Is the price of Internet service rising or falling? Benton Senior Fellow John Horrigan recently tried to answer this question in a recent analysis for the Benton Institute using the FCC’s Urban Rate Survey (URS). His analysis builds on a prior piece by USTelecom. The answer is important because significant real increases in the cost of broadband may delay its benefits and serve as an argument for greater federal involvement. In brief, the price of most connections has fallen significantly since 2020. However, subscribers are choosing to spend more on faster plans.

 

Horrigan concluded that “[b]roadband service offerings at the highest speeds are expensive, growing in prevalence, and driving up average broadband prices.” Average price across all broadband plan offerings grew 4.8 percent in real terms. However, he also found that the rise is mainly due to increased demand for high-speed connections (2 Gbps or higher), not general inflation. The portion of high-speed plans in the URS sample rose from 9% to 16%. As the number of high-speed plans increases, they form a larger percentage of the URS survey. This in turn raises the average price for all plans, even if the price of every specific plan remains the same.

The chart below gives the average change in the price of different plans between 2020 and 2025 for different equipment and speeds. Higher than 2 Gbps is measured from 2021.

 Change in Real Broadband Prices from 2020 to 2025

Speed or Technology	% Change
Technology
Cable	-13.8
Fiber	+40.1
DSL	-9.3
Fixed Wireless	-50.7
Speed
Below 100 Mbps	-15.0
100-1000 Mbps	-28.9
1000-2000 Mbps	-15.3
Greater than 2000 Mbps	-25.3

Consumer demand has likely driven most of the increase in fiber. Horrigan also found that the quality of Internet plans is increasing. The most obvious improvement has been in data speeds. However, increases in the variety of content and reliability also matter. As the quality of broadband increases, consumers are willing to pay more.

The survey does point to a possible price ceiling in which low-income users are unable to pay higher prices even when better quality is considered. The decline in offerings of the lowest-cost plans may hurt low-income households. However, many Internet providers have special offerings for qualified low-income households that offer discounted prices. For example, Xfinity Essentials provides affordable home Internet for qualifying households ($14.95 per month for up to 75 Mbps, or $29.95 per month for up to 100 Mbps) — as well as low-cost computers, free WiFi hotspots, and free Internet training. CTIA points out that the industry has participated in programs like Lifeline, the Emergency Broadband Benefit and Emergency Connectivity Fund, and the Affordable Connectivity Program.