The Public Advocates Office, which is part of the California Public Service Commission, undertook a a deep analysis of broadband pricing in the state, correlated with the level of competition. The study was conducted from August through October of 2025.
The study looked at four large markets in the state: San Mateo, Oakland, Los Angeles, and San Diego. By choosing these markets, the study encompasses the four largest ISPs in the state – AT&T, Comcast, Charter, and Cox. The study gathered information on available broadband plans by location, advertised speed tiers, and promotional prices. The study also overlaid household incomes from the Census across the data it gathered to explore if household income played a role in prices offered by the big ISPs. The markets are interesting because they not only vary by ISP, but each market has some neighborhoods where the only gigabit provider is the cable company, and other neighborhoods where there is also one or more fiber competitor.
The overall conclusion of the study won’t surprise anybody who follows the big ISPs – broadband prices vary by the level of competition. In aggregate, the study showed that the price for broadband in competitive neighborhoods across the four markets was around $51 per month, while prices in non-competitive markets were $15 to $40 higher per month for comparable services.
The study resulted in three major conclusions:
Gigabit Fiber Drives Lower Broadband Prices. The study demonstrated that price competition only kicked in for neighborhoods where there are multiple ISPs offering gigabit broadband. That means a cable company and at least one fiber provider. The study showed that when there is competition for gigabit broadband, the competition extends downward to slower speeds offered by the big ISPs.
The study demonstrates something that is probably obvious, in that pricing is trimmed even further when there are more than two gigabit providers in a neighborhood.
Sub-Gigabit Providers Do Not Reliably Constrain Price. This is an interesting finding. It says that when the only competition to a cable company is an FWA cellular provider or a fixed wireless ISP, the cable company does not engage in significant price competition to keep customers. The study showed that, in fact, some of the neighborhoods with this kind of competition see the highest prices from the big ISPs.
This doesn’t mean that cable companies never compete hard against 100 Mbps providers, but this finding makes a lot of sense. Customers are attracted to the low prices of the FWA providers, and both T-Mobile and Verizon have price options as low as $35 per month. Cable companies, at least in these four large markets, are not willing to drop prices to compete with those prices.
Income is Not a Primary Driver of Prices. This is a bit of a surprise, because there were previous studies that suggested that pricing was lower in neighborhoods with the highest household incomes. That may have been true five years ago, but the data now suggests that prices offered by the big ISPs are mostly related to the level of competition.
The study made some other interesting observations. One observation is that in competitive neighborhoods, promotional prices can vary by household, and somebody might be paying a significantly higher or lower price than their immediate neighbors.
The study is worth reading for anybody interested in how big ISPs compete. The study has a lot of detail about how big ISPs stratify addresses and pricing offers based on the presence of other gigabit providers, while not caring much about ISPs that compete with slower products.
https://en.wikipedia.org/wiki/Lies,_damned_lies,_and_statistics
Whatever it takes to prove that government funded ISP’s are the only path forward. Gotta protect that free money.
Realize this is the CPUC — the same body that oversees some of the highest electricity rates in the country. I wouldn’t trust them to accurately do my 12 year old’s financials.
there’s some good information in here, but it’s also biased/selective data.
For instance, and this is obvious, population density drives self-builds for ISPs especially coax and fiber ISPs. The point being that there’s an availability bias in this data. Looking only at large markets with high density and high availability means that the providers are most often competing with others with big enough budgets to build gigabit services that overlap. And that skews that data away from FWA competition. Consumers have been conditioned to choose cable or fiber first, so FWA is obviously trailing behind on a pure product selection. And since those ‘wired’ vendors are now in a battle over price, the FWA discount vanishes.
When you leave the high density areas, the coverage of any given provider drops radically. Which means the viable competition shifts from cable or fiber alternatives to FWA and LEO.
The data here is trying to suggest that it’s important to build out fiber networks to compete. That’s the main bias. It’s using urban environments where cost per door is much less and so cost to build these networks per passing are far far less.
The problem with that bias is back to the first point, density drives self-builds. Government builds are not driven by density, just doors. And that means that all of this data is basically irrelevant because the market model is not just different, it’s opposite. ie, government builds are not focused on rural small towns, they are blanketing coverage at basically ‘any cost’. Many passings in rural areas are between a few thousand dollars per passing or even tens of thousands per passing.
Now out to the smaller markets and rural areas. There are fewer doors to service and so there’s less competition naturaly. markets can bare only so many companies serving a population. So the headline premise is true, competition drives prices down. But this is a CPUC study with an obvious slant to be used to justify government intervention. The conclusion is an easy cut and paste justification for government intervention.
Go to markets that have fewer competitors because the population can’t support those companies, fund fiber builds most likely, and then likely force providers to offer services at discounted rates. Similar to what New York has tried.
There’s a gigantic flaw in this model though. other markets don’t support having many vendors, and the government forcing their way in with funding just erases the existing smaller providers, mostly the wISPs or independant cable operators or even independed fttx operators.
I’d say just look at the list of providers on this list for evidence of that. AT&T, Charter, Comcast, Cox. That’s the list. All national brands, primarily due to state endorsed monopolies and funding, and zero local companies.
When whatever arrangement is made to get these companies to service the lower density areas expires, they’ll just sell off or trade out to consolidate and we’ll be right back in the same boat of a single provider in low density areas. It’s exactly what happened with cable tv services, it’s exactly what happens when the government writes reports design to be quoted for the next round of government intervention in markets.
And to be clear, obviously it costs more to bring services to low density areas. It also costs more fuel to drive home or to the airport, it costs more dollars per area to police or have fire services. It costs more to run a school because of bussing. grocieries cost more because of trucking. The lack of really basic economic knowledge by these people is disturbing.
“The lack of really basic economic knowledge by these people is disturbing” — That’s a very nice way to wrap that up. 100% agree