Broadband prices have dropped, in some cases significantly, over the past half-decade, according to an analysis by Broadband Now, which compares broadband services. 

The White House has been pushing its broadband subsidies in part by arguing affordable broadband is “out of reach“ for many in the country, but the trend —thanks to technology and economics — is already providing a tailwind toward greater affordability. 

The study of 50 national and regional broadband providers found that since 2016, prices decreased for all major download speeds (25 Megabits per second through 1 Gigabit per second and above, and over cable, fiber, digital subscriber line (DSL) and wireless networks. 

Broadband Now concedes that it is typical for technology to become cheaper as manufacturing improves and providers scale up, but decreasing prices are decreasing prices regardless of the reason. 

The study found that the highest speeds, and thus priciest plans, have fallen the most by an average of almost $60, or 42%, for 500 Mbps-plus service. 

That was followed by a $34.39 (35%) drop for 200-400 Mbps; $32.35 (33%) for 100-199 Mbps; and by $8.80 (14%) for 25-99 Mbps (the FCC's defines high-speed broadband as 25 Mbps-plus). 

The White House has put a thumb on the scale for fiber in its multibillion-dollar broadband subsidy programs and the study suggests that from a pure cost standpoint, that would make sense. “Fiber tends to be cheaper than cable [excluding promotional pricing] for most high-speed plans, even as fiber is generally considered to be the most robust and highest quality type of wired internet connection,” the study concluded. 

The White House is also factoring competition into its broadband availability and cost equation, something the study also backs up with the point that local prices are “reflective of competition.”

Among the ISPs studied were Comcast, Cox Communications, AT&T, Mediacom Communications, Verizon and Google Fiber. ■

A favored telecommunications analysts painted a bearish, if not bleak, picture for a loyal following of small and medium cable operators, as he considered new Internet rules and price regulations.

MoffettNathanson principal and senior analyst Craig Moffett, a longtime cable bull, gave the crowd at The Independent Show in Boston a mixed forecast for the next decade.

He reminded the crowd of the painful market forces that have begun to buffet cable operators – and programmers -- of all sizes at this moment in time. 

TV ratings are down, and programming costs are up. The biggest programmers are licensing more shows to OTT players. 

“They’re increasingly licensing content (to OTT) because it’s the only way to plug the hole in the income statement,” Moffett said.

He suggested that the trickle of OTT services could swell to a torrent that could do real harm to the traditional dual-revenue stream business model that has served programmers and cable operators so well for so many years.

And there is ample evidence that cord-cutting continues to accelerate, he said, triggering nods in unison around the crowd when he noted the pressure on the bottom line.

As if the current conditions weren’t bad enough, Moffett said the near future will be tougher to navigate. The one, big bright spot for cable operators from a revenue viewpoint – broadband service – may soon see the end of its heady growth as the market matures.

Penetration of broadband has been steady, but slower growth is ahead; almost everyone who can afford broadband or wants it, has it. Of the people who don’t have broadband, most are not ideal customers: Half of them make less than $25,000 annually, or are considered undereducated or don’t own computer, Moffett noted.

While he said he saw some bright spots with potential for growth, they were few. Potential growth lies in such areas as business services, and the growth of wireless demand holds promise for cable’s Wifi offerings. The most obvious option for revenue growth: Cable operators can leverage the pricing of broadband.

“It’s the one thing here that you have some flexibility to control, at least competively,” Moffett said.

But if they do, they risk the ire of the FCC, which is soliciting complaints. Title II “is absolutely about broadband price regulation,” he said, “and in that context lies the real challenge for the cable operators.”

Still, he said, Title II is not a certainty either, as the new rule could be quashed by a new congressional action or get tossed out by a federal  court or even left inactive by a new FCC chairman.

“This topic of regulation is unavoidable as you think about the next 10 years,” Moffett said.