America’s Egregious Broadband Rates vs Overseas Prices. Why?
This chart, taken from the European Union Report on Broadband, shows that a triple play — phone, cable TV, broadband-Internet, can cost about 36 Euros for a service with 30–100 Mbps speeds, and 21 Euros for a stand alone service. However, the second chart below shows that some countries are offering 21 Euros for a triple play, 10 Euros for a stand alone broadband connection. The average US triple play is about $220.00 a month, and with an exchange rate of 1 Euro=$1.09 Dollars, the overcharging, which we documented, is $150+ a month — or more.
The Digital Divide was created, in large part, because prices are unaffordable, and America is now paying for over 20 million low income families to have broadband — up to $30. a month allowance.
America’s prices are out of control, yet where are the investigations and audits to explain how overseas prices are a fraction of what we are paying in the US? And why are we giving billions to the companies that helped to create the Digital Divide in the first place?
THIS IS PART OF A NEW SERIES: America’s Communications Prices are Out of Control.
We assembled our previous research with new findings in this new series, using both 3rd party expert analysis as well as actual examples from December 2023, comparing and detailing the out of control US prices vs the services of FREE Telecom in France and Spectrum-Charter in New York City.
America’s broken promises and the state 5 year broken broadband plans.
As we discuss, America’s prices for broadband have made high speed internet unaffordable for many households, Moreover, the pandemic revealed a major Digital Divide where whole areas of the US were never upgraded to fiber optic networks, much less high speed services even over the copper wires. Thus, no competition to lower rates.
And every state now has plans to ‘bridge the Digital Divide’, but in all of the state broadband plans, none have addressed how the Divide started in their state or about the massive financial price divide between America and the EU or Asian countries that charge a fraction of the prices charged in the US.
Over $150 billion is being given out in state and federal government subsidies over the next few years, and much of It going to the companies that helped to create the Digital Divide.
We write this because the states must investigate the core issues as they impact almost every FCC, NTIA, FTC, Congressional and state current and future actions.
In this, PART 4, we will highlight the last broadband pricing data from the EU broadband commission, originally presented in 2022 and updated here.
But to start, we fast forward:
Part 1: Examined the pricing overseas vs the US for the Triple Play,
In December 2023, we received an email from an American senior couple living in France who sent along their communications bills for a Triple Play offered by FREE Telecom, which is a 5 Gbps fiber to the home service that cost 29.99 EUROS, and after a year increases to about $44. dollars. It also includes an offer for 2 wireless 5G broadband lines at $11.00 US, each. We compared that bill to the current Spectrum-Charter New York City, December 2023 bill which was over $225 with no frills, movies; just basic service, and an add wireless option for $29.99 per line after promotion — not counting the related taxes, fees and surcharges. (This comparison matched the information from the EU Report and other data we provided for wireless.)
And note that this FREE Telecom 5G comes with 250GB; the Spectrum offer is 30 GB then the service slows.
PART 2 The Free French Telecom Fiber Optic Triple Play Has “No Gimmicks” Vs America Getting Screwed. This part supplies the details of the comparison, and it shows that America’s bills have become a collection of made up, added, or pass-through fees, taxes and surcharges, The FREE Telecom offering has “no gimmicks”, no extra fees. The difference is $181 extra a month.
And this chart shows, back to back, the FREE Telecom triple play and the US-Spectrum NY City triple play; it should be like reading the Riot Act to regulators for the failure to stop all of these made up charges on America’s communications bills.
PART 3: We have written about the price of wireless overseas vs the US, using extensive research and analysis by Rewheel Research.
§ The price for the Verizon 5G service we presented had an $80 package, but with added fees and taxes is actually $104, while the $70 package, which has only 5GB is $91, (and the average of the two is $97)
§ Now, compare this to the overseas median price of about $17.50 — for a stand alone ‘unlimited’ service with over 1000 GB
§ That’s $97 vs $17.50 dollars, about a 458% difference. So, besides getting only a small number of Gigs, Verizon’s prices for this example are being overcharged by about $80 a month!
§ Also, as we point out, the word “Unlimited” in the US is deceptive and means “We were only kidding”, vs the EU countries, where the word unlimited means — without limits.
PART 5: UPCOMING: We will slice and dice the analyses of the FCC, NTIA, AT&T, Verizon Centurylink, Comcast, Spectrum-Charter, Telco, Cable and wireless — and their associations and friends — and we will cover overcharging on billing, the ACP low income funding and government subsidies of over $42 billion in BEAD money — which has taken good intentions and has become a new profit center. And we will explain how America’s prices went out of control and helped to create the Digital Divide.
FREE BOOK DOWNLOAD: DISS-CONNECTED was written for the general public to reveal the multiple subplots of how Big Telecom and Big Cable were able take over America’s communications agenda for their Corporate Interests and how the government failed to halt or even understand the various ways we’ve been deregulated and overcharged, For more details we created Violations & Egregious Acts.
PART 4: EXAMINING THE EU BROADBAND DATA VS AMERICA’S BROADBAND PRICES
(SECTIONS WERE PREVIOUSLY PUBLISHED NOVEMBER 2022)
The opening chart from the EU broadband commission. tells the tale of how the European countries did not allow for massive multiple additional made up fees, such as the Broadcast & Sports fee, ($27.90 on a Spectrum Triple Play). Moreover, the services do not charge ridiculous prices for equipment, such as set top box, that is required to use the service. Also, because there is competition, customers have choices and prices have not skyrocketed, but are actually going down.
The Triple Play vs 3 strikes, you’re out.
Let’s provide more detail. How can America’s prices for the stand-alone, double and triple play — (phone, cable TV and ISP-broadband) be 5–10 times more when comparing data from other countries, as highlighted in the European Union Commission’s report, published July 2022 for the year 2021. And, as the report details, even basic stand-alone high speed broadband prices overseas are a fraction of what we’re paying in the US. (We rounded the numbers.)
§ America’s “Double play” — high speed broadband and phone service — is being overcharged, on average, almost $75 a month — a whopping $900 a year.
§ The “Triple play” is being overcharged by $180 a month on average; this comes to overcharged, over $2,200 for the triple play.
The current triple play in America, after the promotional prices end, is now around $220.00 a month, yet overseas, the average was around $40 a month, but the prices overseas are in decline. However, in some countries, it can be as low as $23.00 for 200 Mbps or more; only $15 for the double play.
According to the EU report, we’ve even been beaten out by Bulgaria, Romania and let’s not forget Slovakia:
“Overall, Lithuania and Romania have the most attractive prices for broadband internet in the EU. All the offers in these countries belong to the cluster of the least expensive countries in their respective baskets. Bulgaria, Latvia and Slovakia follow. Poland, Hungary, France and Spain have low prices especially for Triple Play.”
But when the EU report says prices are “attractive”, we are talking $10–12 bucks a month for stand-alone broadband and $20–23 for the triple play, with speed of 200 Mbps or more. We included the Least expensive pricing chart with the lowest average.
NOTE: Bulgaria does get Netflix and their Top 10 shows are close to America’s viewing.
Again — -How is it possible that America’s Triple Play is $150-$200 a month over what is being charged overseas? That’s over $2,200.00 a year ‘extra’ being charged to families — including low-income families and fixed income seniors. This is on top of the fact that there could be only one or no providers of high-speed services in the rural regions or in low-income neighborhoods of cities.
It would be one thing if it was a small differential between the overseas EU group and others price of service, but this is a difference that is too large to be ignored.
Let’s discuss some of the underlying issues, the subplots that most don’t see.
No Serious Competition to keep market forces and rate increases at bay. First, AT&T et al. failed to show up with high-speed competition to keep the cable companies, the other group of providers that use a wired connection, in check. For example, in CA, AT&T-Pac Bell had obligations to bring fiber optic broadband throughout the state and our maps showed that much of AT&T’s entire Los Angeles county region had been left to deteriorate and not upgraded as promised with fiber optic infrastructure.
Made-up Fees and surcharges are out of control. — One of the sleaziest practices in the US has become the addition of made-up taxes, fees and surcharges that are not mandated or government sanctioned. This is being done so that the companies can quote a price that is missing 20–40% of the total costs,
See PART 2 for a more complete example of the made up and added fees on the US Spectrum Triple play vs the FREE Telecom Triple play.
Made-Up Taxes, Fees, Surcharges — (These are based on 2022 prices, which of course increased, and used a collection of bills and web information.)
· Broadcast and Sports surcharge: $15–24.00 a month
· Cost Recovery Fee: $1.99–2.99
· Admin Fees: $1.49-$2.99 per month
· Pass-through taxes, Gross receipts tax, telecom taxes
The largest and most egregious added fee is now the Sports and Broadcast surcharge, which is really 2 separate charges that have been merged in many cases.
“Made-up, Broadcast-Sports Fees Up 820%; Overcharging $250+ a Year — then Quintuple-Taxed, Fee’d and Surcharged.” — This article was written in December 2021, and along the way there have been increases bringing the total charge on the Spectrum NY June 2022 bill to $23.70 — a month.
This one fee on the Spectrum NY Triple play bill is more than the entire charges for a triple play in many overseas EU countries.
NOTE: This charge went up to $27.90 a month extra in 2023. That is an overall increase of 1140%.
§ Quadruple Taxed, Fee’d and Surcharged. — If the increases to this one fee is not enough, there are made-up taxes, fees and surcharges being applied to this fee as it is considered ‘revenue’ to the company and is taxed as such. And some of these surcharges are actually tax pass-throughs where the company gets to have the customer pay the company’s taxes.
§ It is impossible to calculate the exact tax assessment as there is no ‘Rosetta Stone’ to be able to unravel how each tax, fee and surcharge is applied.
But, considering that basic telecom taxes can be 12–20% depending on the city and state, if a 15% tax is applied, that would add an additional $3.55 more per month.
§ Not included in the advertised price: To add irony to obfuscation, this fee is never included in the advertised rates, nor is it added completely in the promotional price, making the increases after the promotion even more egregious.
§ Not included in the EU statistics for the US Triple Play, etc. — Ironically, the EU informed us that they do not include the extra charges and fees in the US because — well, the other countries only have a VAT (Value Added Tax), and not the made-up fees.
§ No Oversight, No Audits; Regulators Failed US. — The idea that a state-franchised cable service or the Holding Companies that control the state telecommunications public utility can just make up fees and add them to bills with no one asking for a cost analysis or some other justification to raise this make-believe charge, should have the peanut gallery screaming.
§ Public has Amnesia — No one knows who these local telecom companies are or what they’ve been able to get away with. And virtually no one could answer basic questions about who the companies are or the services they offer.
§ Let’s give government subsidies to keep America in a perpetual state of “Please Sir May I have another?”. Currently there are subsidies being given to low-income families to go online, which are then handed over to the same companies that have caused this Divide in the first place; i.e.; a new flavor of Corporate Welfare. We will address these issues in an upcoming story.
The Real Subplot: The Telecom Holding Companies that control the critical infrastructure wires, towers and antennas created the Digital Divide. They also control the pricing of all services, wireline, wireless, broadband, internet and even cable, and as we will discuss, they also were able to manipulate the accounting formulas to have the state telecom utility act as a cash machine to fund, illegally, the other lines of business.
America must go after these cooked books and must clean up the mess. There is plenty of money to get America upgraded, and it must be seen as the first step in LA County to clean up the mess and decades of public policy and regulatory issues.
In Sum: Government subsidies, both state and federal, to companies who have created the Digital Divide and can control the prices and profits over the public utility wires needs immediate investigations — not more gifts of largesse.
And is it “overcharging” if you’re paying $75 a month more for your broadband connection to watch Netflix — over $900 a year more than countries overseas? Would the Digital Divide be solved if the rates matched the EU and the costs for a wireline broadband connection cost only $10–15 bucks a month, and your cell phone for 100 GB less than $10 bucks?
Violations & Egregious Acts: You can fool all of the people all of the time… until they know the truth. IRREGULATORS
PART 5: UPCOMING: We will slice and dice the analyses of the FCC, NTIA, AT&T, Verizon Centurylink, Comcast, Spectrum-Charter, Telco, Cable and wireless — and their associations and friends — and we will cover overcharging on billing, the ACP low income funding and government subsidies of over $42 billion in BEAD money — which has taken good intentions and has become a new profit center. And we will explain how America’s prices went out of control and helped to create the Digital Divide.
