Scientific American’s Flawed Broadband Analysis

Scientific American’s editors declare in its October 2010 issue that broadband prices in the United States are too high and speeds are too low. As a result, the editors implicitly assert, the U.S. has fallen to 40 th place in “progressing towards a knowledge-based economy. ” They conclude that remedying the situation requires unbundling access to local loops, mandating net neutrality, and classifying broadband under Title II of the Telecommunications Act of 1996. Scientific American has the right concerns and objectives: ensuring that the United States remains a technological leader and that its broadband market is competitive. However, a closer look at the facts, as explained, for example, by the FCC‟s National Broadband Plan, reveals a more nuanced story that does not support their confident policy proposals. The editors ‟ incomplete understanding of the industry causes Scientific American to ignore the real policy issues the United States must face to improve broadband adoption, use, and innovation. In particular, the most important policy priority now is to ensure that wireless broadband continues its remarkable advances by making more spectrum available for high-value uses like broadband. The National Broadband Plan emphasized this point when it recommended quickly making an additional 500 MHz of spectrum available for such uses. Arguments that focus on a narrow view of how Americans will connect to the broadband network distract us from the important policy work that nearly everyone agrees is crucial for our broadband future. Speeds Average advertised download speeds in many OECD countries are, in fact, faster than they are in the U.S. Yet, taking into account the speeds consumers actually receive tells a different story, as Figure 1 demonstrates. The figure reveals several points. First, the average advertised speeds reported by the OECD are almost always well above the actual, measured speeds, with a fe