Why Your Computer is Getting Cheaper but Your Broadband Bill Isn’t

Using the most recent data from the Bureau of Labor Statistics, we compared the prices of wireline broadband to that of computers, computer software, and wireless cell phones. We also tracked those against the entire Consumer Price Index. Here’s what we found:

While the price of these other technology-driven products and services has continued to fall over the last few years—personal computer prices have dropped over 44 percent in five years—the prices for wireline broadband have mostly been flat. So why haven’t wireline broadband prices budged in recent years? The high, fixed costs of broadband means that there hasn’t been a big rise in competition among providers, according to Scott Wallsten, Vice President for Research and Senior Fellow at Technology Policy Institute. Indeed, most Americans don’t have more than two options when it comes to wireline broadband providers. In the meantime, people who don’t have broadband want it badly and the for those who do have it, it’s become increasingly indispensable. The result is that there hasn’t been much downward pressure on prices.