Why Isn't the Price of Broadband Obeying Moore's Law?

The quality and cost of broadband Internet access haven't budged in years.

The U.S. government doesn't keep an index of broadband Internet prices by which to evaluate the success of its broadband promotion policies -- the statistics they do have are mushed together with prices for dial-up access -- so a couple of researchers at Northwestern University decided to build their own. What they discovered is that broadband Internet prices have remained nearly stagnant since 2004, despite the explosive pace of adoption since then - from approximately 20 percent of U.S. households in 2004 to more than 65 percent today. In that time, the only thing that has really changed is the quality - just looking at upload speeds, they've more than doubled in that time. But that's nowhere near what you would expect if the price / megabit/s of broadband were obeying Moore's Law.

The reasons for the stagnation of U.S. broadband are multifactorial, but one of the authors, Shane Greenstein, argues that the 2003 decision allowing the broadband industry to regulate itself has caused much of the stagnation.