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Research: Americans’ Wireless Prices Are “Out of Control”; Overseas Customers Getting Service “for a fraction of the costs”

January 14, 2022
Activist Post

By B.N. Frank

Over the years, numerous lawsuits have been filed against the Federal Communications Commission (FCC) including one by a group of telecom experts, “The Irregulators”.  According to the lawsuit, Americans have already paid for telecom-related services that many have still not received – including high-speed broadband via safer, more secure, and more reliable fiber optics to the premises (FTTP) and copper landline connections (see 1, 2).  The Irregulators have also proven that Americans have been overcharged for telecom-related services for decades and continue to be overcharged because the “powers-that-be” are allowing this to happen.  Thanks again to Irregulator Bruce Kushnick for another detail-packed article about this same infuriating reality.

From Medium:

America’s Wireless Prices Are Out of Control as Compared to the Rest of the World.

By Bruce Kushnick

New research from Rewheel Research on wireless pricing for 2021 found that overseas, customers can get 100 Gigs for a fraction of the costs we pay in America. The chart above highlights the results of the Rewheel Research survey of wireless services, including the ‘lowest cost for wireless’ from around the world.

“Among the ten operators with the lowest monthly prices for 100 gigabytes were operators from the Israeli, Indian, Malaysian, Romanian, Italian, Chilean and French markets.”

“In September 2021, the minimum monthly price for 100 gigabytes was 7.99 EUR in Italy and 8.90 EUR in France.”

  • NOTE: The EUR (Euro) was $1.12 US dollars when we did these comparisons, 11/25/2021. As of Jan. 13th, 2022, it is $1.15.
  • This means that Italy and France have a low-cost average of 8.45 Euros, about $9.46 dollars (rounded) and these services do not include the “cost recovery charge” and other made-up fees that are part of America’s pricing.
  • 100 Gig services aren’t even offered in the US, regularly.

Compare this to America’s Wireless Prices

EXAMPLE: The chart above has 2 parts: the left is from a paper flyer containing an advertisement from Spectrum, New York dated November 2021 and it shows that service costs $14.00 per Gig. The part on the right is taken directly from a web advertisement from the French company “Free” wireless, that features two services being offered in France; the first is for 80GB for 9.99 Euros (about $11.20 bucks) or 150GB for about 19.99 Euros, $22.40 US.

(NOTE: We use the exchange rate, 1 Euro = $1.12 dollars, and we are rounding the numbers in some cases.)

“GB” or “Gig” or “Gigabytes” are the tech terms for the quantity of stuff you can use on your broadband wireless or wireline connection online. Thus, watching a movie or being on Zoom uses up your Gig allowance.

How is it possible that in the US, a company can charge $14.00 per GB for wireless while this French company’s service delivers 1Gig for around $.15 cents? This example, and the new Rewheel data demonstrates that America is being held hostage by a few US companies, AT&T, Verizon, CenturyLink, along with Comcast and Spectrum, that have taken control of our communications services, giving them carte blanche to charge us massively excessive, inflated prices.

The price per Gig is $.09 cents vs $14.00 a Gig per month, not counting taxes, fees and made-up surcharges.

And we’ve already examined this issue, not just for 100 Gig offerings but for “unlimited” plans overseas where the term has not been co-opted to mean a price cap.

When providers in other countries are charging under $10 bucks for 100 Gigs of wireless service, while Spectrum (which is reselling Verizon’s inflated service) can charge $14 for 1 Gig, not counting taxes, fees and surcharges…

Solve the Digital Divide? Go after the Overcharging.

Overcharging: There is, of course, a range, but let’s call it $30-$75 a month, $360-$900 per phone, a year, per household, especially on the larger plans; it can even be the overcharging per phone account, or even per phone, depending on the family.

Is it ‘just and reasonable’ to call this difference between the price of wireless offered by the overwhelming majority of different wireless carriers in different countries and America’s wireless companies overcharging? You bet it is! This gross overcharging needs immediate investigation.

Up until 2017 the FCC had been issuing Mobile Wireless Competition Reports. The last one made an affirmative finding of effective competition in the industry. The FCC’s Press Release stated:

“The 20th Report presents a variety of data from 2016 and certain information from early 2017, and conducts an analysis of those data based on various generally-accepted metrics of competition. For example, consumer demand and output continue to increase, average prices have been falling, and service providers have enhanced the performance, coverage, and capacity of their networks. The 20th Report concludes that competition continues to play an essential role in the mobile wireless marketplace, driving innovation and investment to the benefit of the American people and economy.”

Solve the Digital Divide? UnCapture the Regulators.

All those high-falutin words are used to cover over that the FCC is clueless or worse, has been captured by the industry.

Why hasn’t the FCC taken action against the wireless companies for their egregiously high prices. Instead, along with the industry it is supposed to regulate, it promotes the fiction that competition among providers ensures reasonable rates for Americans. It ignores the fact that we pay many multiples for the same service compared to other countries.

The Government Subsidies are Subsidizing the Overcharging.

The failure to come to grips with America’s inflated prices isn’t simply that America is paying too much; it has helped to create the Digital Divide. If prices were just and reasonable, low income families would be able to afford services — -and affordability is at the core of the Digital Divide.

But that’s not the only problem here. The Government is compensating the companies via various government subsidy programs, such as the Emergency Broadband Benefit, EBB, where low income families can get up to $30 a month toward their broadband bills.

So, not only are low income families (and America) being gouged, but our government is also forking out billions in funding to reimburse these families based on the retail price of these services, which, in turn, is paid to the companies who have inflated prices. Worse, these retail prices include made up charges, such as the ‘cost recovery charges’.

We examined these issues in a previous post, and here.

Where are the audits and investigations to halt the wireless overcharging and rate gouging in America as compared to the offerings overseas?

Solve the Digital Divide? Follow the Money; It’s about the Wires.

But the punchline: wireless prices are NOT the primary issue. To solve the Digital Divide, America needs critical fiber optic wireline infrastructure to support high speed broadband and internet. Almost all wireless services require a fiber optic wire to work; and the pandemic proved that it is not a substitute for the fiber optic broadband connection to the home.

In fact, when we follow the money of overcharging and rate increases, it all leads back to the wires for all communications services — and these wires are controlled by only a few companies; AT&T and Verizon are on the top of the list.

Despite all of the above, the Infrastructure Bill (see 1, 2, 3), the Emergency Broadband Benefit (EBB) (see 1, 2), and other internet connectivity funds have also provided hundreds of millions of dollars to “Big Telecom” companies that are primarily deploying more unsafe, unreliable, and inferior Wi-Fi and 5G broadband connections.  In fact, earlier this week, the FCC announced it was allotting $361 million MORE to companies to provide “Wi-Fi hot spots”, “more than 313,000 broadband connections” and to “build new networks”.  Argh.

The FCC is supposed to protect Americans by regulating telecom-related industries (i.e. broadband, cable, and wireless).  Instead, it has catered to these industries for decades (see 1, 2).  Most – if not all – former and current appointees have been employed by these industries when they weren’t working for the agency!  As previously mentioned, other lawsuits and petitions have been filed against the FCC as well (see 1, 2, 3, 4, 5, 6, 7, 8).

Activist Post reports regularly about the FCC, “Big Telecom”, and unsafe technology.  For more information visit our archives and the following websites.

Top image: Pixabay

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Research: Americans’ Wireless Prices Are “Out of Control”; Overseas Customers Getting Service “for a fraction of the costs”