US internet speed lags behind S. Korea, Latvia

SAN FRANCISCO - The good news? The Internet is getting faster, or at least average connection speeds in the United States are, according to Akamai's latest "State of the Internet" report.

The bad news? Our speeds are half those enjoyed in South Korea. In fact, we're ninth on the list among nations, limping along behind Latvia and the Czech Republic. And we drop to 14th when it comes to average peak speeds, according to the study from the Cambridge, Mass., firm, which helps websites accelerate content delivery.

It's troubling news, because studies repeatedly link faster Internet connections to improved economic development and education outcomes. To the degree that we're lagging other nations, we're forgoing opportunities.

The U.S. average of 7.2 megabits per second, after all, means lots of people, particularly in rural areas and low-income neighborhoods, are grappling with speeds far below that. And those are people who need access to information, online tutoring and job opportunities as much, or more, than anyone.

A 2011 report concluded that doubling broadband speeds can increase a nation's gross domestic product by 0.3 percent. That would add up to $126 billion in the United States, noted the study by networking equipment company Ericsson, consulting firm Arthur D. Little and Chalmers University of Technology in Sweden.

It's also bad news because faster Internet connections enable next-generation applications, the things we might not even know we need or want yet.

When the Internet transitioned from dial-up to broadband, we went from happily waiting for still images to load to streaming movies on Netflix and Hulu -- and learning about physics and math from Khan Academy videos. The acceleration of Internet speeds has transformed countless industries, upending the way we learn, play, shop, date and much, much more.

But now, South Korea is consistently winning the race, clocking in with average connection speeds of 14.7 Mbps during the third quarter, according to Akamai. Japan came in second at 10.5 Mbps, while Hong Kong ranked third at 9.

There are a variety of reasons why the United States falls near the bottom of the top 10 nations, but much of it boils down to the lack of competition -- specifically the continuing reign of dominant legacy players in telecommunications like AT&T and Comcast, despite otherwise vast changes throughout the tech sector.

The government of South Korea has actively promoted fast and plentiful Internet access through a series of policy initiatives, including forcing its public power utility and dominant telecom company to open up their networks to rivals, according to Wired.

The United States took a step in this direction with the Telecom Act of 1996, requiring incumbent players to provide competitive phone and DLS providers access to legacy infrastructure like copper wires. But heavy telecom lobbying and favorable FCC interpretations in the early 2000s limited the practical effects of these rules in terms of sparking new competition.

"Everyone followed (the requirements) just as much as they had to," said David Belson, editor of the Akamai report. "You can see that at play in many locations, where some providers have a de facto monopoly in a given city that makes it harder for other providers to get in there."

And guess what? With fewer options in the market, Americans tend to pay a lot more for Internet, too.

You can get prices as low as 6 cents per megabits per second of advertised speed in Japan, 10 cents in Sweden and 28 cents in Estonia, according to a 2011 report by the Organization for Economic Cooperation and Development. The minimum in the United States is $1.10.

And instead of paying one price for the top available speed, as in much of Europe, we mostly have tiered options that require us to pay more as accelerator ticks up.

The United States is at least narrowing the gap. In the third quarter of 2010, the U.S. had ranked 12th on the list for average connection speeds, at 5 Mbps, a little more than a third of the connection speed in South Korea.

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