More Than a Third of Americans Have Access to One or No Broadband Provider
Tuesday, January 4, 2025
Digital Beat
More Than a Third of Americans Have Access to One or No Broadband Provider
The Federal Communications Commission released the 2024 Communications Marketplace Report on December 31. By law, the FCC must publish a Communications Marketplace Report every two years, assessing the state of competition across the broader communications marketplace. The FCC must consider all forms of competition, including “the effect of intermodal competition, facilities-based competition, and competition from new and emergent communications services.” The FCC must also assess whether laws, regulations, regulatory practices, or marketplace practices pose a barrier to competitive entry into the communications marketplace or to the competitive expansion of existing providers of communications services.
Here we take a brief look at the FCC's findings concerning fixed broadband service in the U.S. and the digital divide based on data through December 2023. For readers seeking the bottom line first: the FCC finds that more than a third of Americans have only one provider of high-speed broadband or lack access altogether.
The Fixed Broadband Services Marketplace
For the FCC's report, the fixed broadband services marketplace refers to the U.S. market in which companies compete to sell high-speed internet access service to homes and businesses through fixed infrastructure—like cable, DSL, or fiber optic lines—and providing a stable, wired internet connection at a fixed location.
Broadband Providers
There were 2,106 entities of varying sizes and deployment footprints that reported providing fixed broadband technology services to residential consumers in December 2023. There were 2,050 providers of residential fixed broadband services in rural areas and 1,566 providers in urban areas. The overwhelming majority of providers cover less than 1 percent of the U.S. population. Only 10 providers covered at least 5 percent of the U.S. population; these providers are: Altice, AT&T, Lumen (CenturyLink), Charter, Comcast, Cox, Frontier, T-Mobile, Telephone & Data Systems (TDS), and Verizon.
Broadband Technology
Consumers access the Internet through a variety of fixed technologies, including cable broadband service, copper (including Digital Subscriber Line (DSL)), fiber-to-the-premises (FTTP), terrestrial fixed wireless service, and satellite service. These services differ in their availability, and also in characteristics, such as speed, latency, reliability, and price. Although satellite internet access service is available to all U.S. households (127.3 million), just 2 million households subscribed to satellite service as of the end of 2023. Similarly, fixed-wireless internet access service is available to over 83 percent of U.S. households (106.3 million) but only 6.8 million households subscribe to such service. Wireline broadband service is available to nearly 96 percent of U.S. households (122.2 million) and nearly 92 percent of households (112 million) pick cable-, fiber-, or copper-based when available.
In December 2023, approximately 61 percent of fixed residential connections were cable, approximately 23 percent were FTTP, approximately 9 percent were copper-based, approximately 6 percent were terrestrial fixed wireless, and the remaining approximately 2 percent were satellite. Between December 2022 and December 2023:
- The number of residential connections to cable services decreased slightly from 74.5 million to 73.4 million.
- Residential FTTP connections increased from 24.4 million to 28 million, approximately a 15 percent increase.
- Residential connections to copper services fell from 13.1 million to 10.6 million, a reduction of almost 19 percent.
- Terrestrial fixed wireless residential connections increased from 4.5 million to 6.8 million, approximately a 51 percent increase.
- Satellite residential connections increased from 1.9 million to 2 million, an approximate 5 percent increase.
T-Mobile’s entire fixed footprint is through terrestrial fixed wireless technology, whereas Comcast, Charter, and Cox almost exclusively provide fixed broadband through cable. In contrast, AT&T provides broadband access with a combination of technologies, covering approximately 65 percent of its service area with copper (DSL), approximately 35 percent of its service area with fiber, and approximately 26 percent with fixed wireless technology. Lumen (CenturyLink) and Frontier also each use a combination of technologies, covering most of their service areas either through DSL or fiber. Verizon covers almost 34 percent of its footprint with fiber and about 68 percent with terrestrial fixed wireless technology. Most of the TDS footprint is through terrestrial fixed wireless technologies.
Broadband Choice
From 2022 to 2023, the percentage of households with at least three provider options for a 100/20 Mbps service increased from approximately 19 percent to approximately 29 percent. While the overall availability of 940/500 Mbps has increased, only about 46 percent of households had access and only about 7 percent of households had more than one provider option in December 2023 at those minimum speeds.
For services meeting a minimum 100/20 Mbps speed threshold, the FCC's data suggest improvements in the percentage of households with at least two provider options. However, there is a significant difference in the percentage of households with at least two provider options in urban areas compared to those in rural areas and in Tribal areas. While approximately 75 percent of the households living in urban areas had at least two provider options for 100/20 Mbps service, only approximately 35 percent of households living in rural areas and 49 percent of households in Tribal areas had at least two options for this service tier. Currently, for services meeting a 940/500 Mbps threshold, approximately 9 percent of households in urban areas had at least two options, compared to approximately 3 percent of households in rural areas and 5 percent of households in Tribal areas.
The FCC finds that when given a choice, most consumers subscribe to technologies that are capable of providing faster speeds. As of December 2023, approximately 66 percent of households had at least two options for services meeting at least a 100/20 Mbps speed threshold; and approximately 7 percent of households had at least two options for services meeting at least a 940/500 Mbps speed threshold. FCC data show that generally prices increase as broadband speeds increase regardless of the last-mile technology.
Broadband Pricing
Pricing for fixed services depends on several factors, including competition, costs, speed tier, technology, geographic area, contract length, and whether the broadband service is bundled with other services. The FCC examined broadband plan information directly from the websites of Altice, AT&T, Lumen (CenturyLink), Charter, Comcast, Cox, Frontier, TDS, T-Mobile, and Verizon, collecting advertised download speed, advertised monthly price, the monthly price on the associated Broadband Label, and the non-promotional price indicated on the Broadband Label.
FCC data indicate a direct relationship between price and download speed—as advertised download speeds increase, so do advertised prices. The least expensive internet-only plan is $30 per month for download speeds up to 100 Mbps, offered by both Cox and Charter, while the most expensive internet-only plan is provided by Frontier at a monthly price of $300 for download speeds of approximately 7 Gbps. Many service providers offer introductory promotional rates for new customers, which can be considerably discounted from the plan’s regular monthly price. Of the 45 plans analyzed by the FCC, all but three had a non-promotional price listed on the Broadband Label that was higher than the advertised price because, in many cases, the advertised price includes discounts for auto-pay and/or paperless billing. On average, the non-promotional price listed on the Broadband Label was approximately 20 percent higher than the advertised price on the website.
Data Caps
In some cases, fixed providers offer service plans that have a data cap, which means that those who subscribe to that plan will be limited in the amount of data they can use each month. Once a customer reaches their data cap they either are charged for additional data they use or are subject to throttled speeds. BroadbandNow reports that 109 fixed terrestrial broadband providers and two satellite broadband providers employ data caps on at least one of their service plan offerings. The majority of terrestrial providers that have data caps—65 of the providers listed—provide service using terrestrial fixed wireless. The next most prevalent technology using data caps is FTTP; there are a total of 24 fiber providers that use data caps. Excluding satellite providers, the largest five providers that specify data caps on at least one service offering are: AT&T, Comcast, Cox, EarthLink, and T-Mobile.
The providers that offer only terrestrial fixed wireless have an average minimum data cap of 364 GB per month, the lowest of the four fixed broadband technologies, followed by cable (593 GB per month) and fiber (801 GB). The average minimum data cap for satellite providers is 58 GB per month.
Of the 19,732,049 Affordable Connectivity Program (ACP) households for which data were reported as of August 1, 2023, approximately
- 51 percent were on a plan that did not have any type of data cap,
- 10 percent were on a plan with a soft data cap,
- 9 percent were on a plan with a hard data cap,
- 21 percent were on a plan with a multi-tier data cap, and
- 8 percent were on a plan with an “other” data cap.
Of the ACP participants who had a service plan that included a data cap, the hard data cap averaged 463 GB and the soft data cap averaged 32 GB. Approximately 11 percent of ACP households on a plan with a hard data cap hit the cap, whereas over 60 percent of ACP households hit their soft data cap. ACP households paid more for plans without data caps, with an average base monthly price of $67.59. Conversely, ACP households that were on plans with multi-tiered data caps paid the least, averaging a $36.10 base monthly price.
The Digital Divide
Because consumers rely on both their fixed and mobile connections to work, learn, access health care, and connect with each other, the FCC also examined broadband adoption, broadband affordability, and equitable access for the 2024 Communications Marketplace Report.
Broadband Adoption
As of year-end 2023, approximately 53 percent of U.S. households subscribe to broadband at the FCC’s fixed speed benchmark of 100/20 Mbps when it is available. Approximately 26 percent of households subscribe to broadband at the FCC’s long-term speed goal of 940/500 Mbps when it is available. Adoption rates for the United States as a whole are higher in urban areas at speeds of 100/20 Mbps, while non-urban areas have slightly higher adoption rates at speeds of 940/500 Mbps until 2023. For Tribal Areas, adoption rates are higher in non-urban Areas, except for 100/20 Mbps in 2023. In general, FCC data suggest that the average household adoption rate in a county increases with median household income and population density and declines with increases in the poverty rate and rural population rate.
Broadband Affordability
Are We There Yet? Affordability, Adoption, Equity, and the United States’s Universal Broadband Goals
The FCC points to two recent studies suggesting that affordability is a barrier to broadband subscription for low-income households and cost appears to be a primary obstacle.1 In addition, recent research by the Benton Institute for Broadband & Society estimates that 43 percent of low-income households are subscription-vulnerable and 53 percent of low-income households find that affording monthly Internet service is either very or somewhat difficult. Other studies suggest that affordability varies across different demographics and geographies.
The FCC finds that these studies suggest that broadband affordability depends on various household characteristics, including household income and expenditures, and the choices, product characteristics, and prices of not only broadband service but also the prices of other products and services that a household consumes. The FCC concludes that this suggests that a comprehensive analysis of affordability will require access to detailed and disaggregated data on broadband characteristics and prices, the prices of other household goods and services, and on geographically varying household characteristics.
Prices for Broadband
Between 2010 and 2023, prices for goods and services overall increased by approximately 35 percent. Prices for internet access services increased at a lower rate, by approximately 9 percent. In real, i.e., inflation-adjusted terms, prices for internet services declined by approximately 20 percent.
Recent research by the Benton Institute for Broadband & Society finds that low-income households (defined as households with an annual income of less than $50,000) paid an average price of $66.53 per month for home broadband service. When asked what they considered to be too expensive a price to pay for service, 56 percent said monthly prices of up to $75—which is approximately the national average price for 25/3 Mbps service—would be too expensive. Only 23 percent of low-income respondents indicated that paying up to $100 per month for service, which is approximately the national average price for 100/20 Mbps service, was affordable to them.
Income Shares Used to Subscribe to Broadband
Since a particular price for broadband is affordable depends in part on a household’s disposable income, the 2024 Communications Marketplace Report discusses data on broadband expenses across income deciles and on the burden of broadband on an example household with an income corresponding to 135 percent of the 2023 federal poverty level.
Differences in broadband prices and regional incomes translate into considerable variation even within speed tiers, particularly for the two lowest income deciles. For example, households at the 10th income percentile must spend between approximately 5 percent of their income in the Mountain Census Division2 and approximately 11 percent in Alaska for a subscription to median-priced 100/20 Mbps broadband service. Households at the 20th percentile must spend between approximately 3 percent (Mountain) and approximately 6 percent (Alaska) for median-priced 100/20 Mbps broadband service.
Equitable Access
FCC data indicate that the number of provider options generally increases with population density and median household income but decreases with household poverty rate. In general, the Census Block Groups (CBGs) in rural areas tend to have the lowest population density and they are likely to have the highest percentage of households with zero broadband provider options, that is, no service availability.
Between December 2022 and December 2023, the percentage of households with no or only one provider offering fixed terrestrial speeds of 100/20 Mbps decreased in the population density and median household income categories, while the percentage of households with two or more such providers increased across the population density and median household income categories. Despite the increase in the availability of providers to households, concerns about equitable access remain as the specific patterns vary, and not all of the analyzed demographic categories experienced comparable levels of improvement. For example, the percentage of locations in the lowest population density quartile without any fixed terrestrial provider decreased by 8.5 percentage points from 27.7 percent in 2022 to 19.2 percent in 2023, and the percentage of locations with only one provider decreased by 3.2 percentage points from 47.8 to 44.6 percent, whereas the number of locations with two or more fixed terrestrial providers increased by 11.8 percentage points from 24.4 to 36.2 percent. In other words, the increase in the percentage of locations with availability of multiple providers exceeded the decrease in the percentage of locations with availability of either zero providers or one provider in the lowest population density quartile. A similar pattern holds true for median household income. On average, service availability is highest in census blocks with the highest median household incomes, the highest population densities, and the lowest household poverty rates. Between December 2022 and December 2023, availability with 100/20 Mbps and 940/500 Mbps improved for all quartiles of the socio-demographic groups.
The FCC's Broadband Agenda
The 2024 Communications Marketplace Report ends with an outline of an agenda for addressing competitive challenges and opportunities in the broadband marketplace. Over the next two years, the FCC expects to continue to:
- Evaluate the Universal Service Fund high-cost support mechanism(s) to promote more affordable and available broadband services for fully deployed networks, working to account for funding being made available through the Broadband Equity, Access, and Deployment (BEAD) Program (established by Congress in the Infrastructure Investment and Jobs Act), as well as from other federal agencies (including the National Telecommunications and Information Administration, the U.S. Treasury, and the U.S. Department of Agriculture) and state agencies to ensure the most efficient use of federal funding. The FCC will also explore ways to improve the E-Rate program.
- Conduct rulemaking efforts regarding broadband availability, including refinements to rules to prevent digital discrimination by examining relevant supplemental reporting, requiring maintenance of internal compliance programs, and evaluating whether to establish an Office of Civil Rights within the FCC. Also up for evaluation are pole attachment rules, including potentially streamlining the processing of large pole attachment applications, and modifying self-help rules. The FCC also wants to ensure that its Broadband Data Collection (BDC) represents the most accurate information possible regarding where broadband is currently available making additional changes to the collection as necessary.
- Work with various advisory committees and task forces including the Communications Equity and Diversity Council, the Native Nations Communications Task Force, and the Connect2HealthFCC Task Force.
- Develop incarcerated people’s communications services (IPCS) rules, including the evaluation of the evolving marketplace for video IPCS to eventually establish permanent rate caps for video IPCS. Other issues under consideration include potentially disaggregating the very small rate cap tier for jails.
Of course, FCC leadership will change on January 20, 2025. Current FCC Chairwoman Jessica Rosenworcel is leaving the FCC and President-elect Donald Trump has indicated that current Commissioner Brendan Carr will be elevated to chairman. In a statement released with the 2024 Communications Marketplace Report, Carr said, "I cannot support the current Commission’s approach to this Report." He indicated that he'd like the FCC to provide a more accurate assessment of the converged market for communications services. He was also critical of including various “equity” considerations.
Similarly, FCC Commissioner Nathan Simington said, "It is time for the [FCC] to modernize its understanding of the communications marketplace along several axes, and I look forward to working with my colleagues in the future to help create, and implement, that new understanding."
So the next Marketplace report could take a drastically different approach to evaluating the state of broadband competition.
Notes
- See, e.g., NTIA, New Analysis Shows Offline Households are Willing to Pay $10-a-Month on Average for Home Internet Service, Though Three in Four Say Any Cost is Too Much (Oct. 6, 2022), https://www.ntia.gov/blog/2022/new-analysis-shows-offline-households-are... EveryoneOn Report 2021 at 5 (survey finding that 40% of households making $50,000 or less report being unable to pay anything for high-speed Internet and 22% of them report being able to pay only $25/month for it); Andrew Perrin, Pew Research Center, Mobile Technology and Home Broadband 2021 (June 3, 2021), https://www.pewresearch.org/internet/2021/06/03/mobile-technology-and-ho... (finding that 45% of non-adopters “do not subscribe to high-speed internet at home . . . [because] the monthly cost of a subscription is too expensive”); Becky Chao & Claire Park, New America’s Open Technology Institute, The Cost of Connectivity 2020 at 10 (July 2020), https://d1y8sb8igg2f8e.cloudfront.net/documents/The_Cost_of_Connectivity... Jonathan Sallet, Benton Institute for Broadband & Society, Broadband for America’s Future: A Vision for the 2020s at 65-66 (Oct. 2019), https://www.benton.org/sites/default/files/BBA_full_F5_10.30.pdf (discussing multiple studies); Rafi Goldberg, National Telecommunications and Information Administration, Unplugged: NTIA Survey Finds Some Americans Still Avoid Home Internet Use (Apr. 15, 2019), https://www.ntia.doc.gov/blog/2019/unplugged-ntiasurvey-finds-some-ameri... (with respect to families with incomes of less than $25,000/year).
- Montana, Idaho, Wyoming, Nevada, Utah, Colorado, Arizona, and New Mexico.
The Benton Institute for Broadband & Society is a non-profit organization dedicated to ensuring that all people in the U.S. have access to competitive, High-Performance Broadband regardless of where they live or who they are. We believe communication policy - rooted in the values of access, equity, and diversity - has the power to deliver new opportunities and strengthen communities.
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