High-speed internet prices drop by 50% around the globe

The price of the average broadband internet connection around the world has been reduced by more than half in the last two years says new research from the International Telecommunications Union (ITU).

The price of entry level information and communication technology (ICT) services and mobile cellular services has also dropped. In 2010 consumers payed on average 18 percent less for ITC services and almost 22 percent less for mobile cellular services than they did in 2008. Fixed line telephony costs declined by around 7 percent during the same period.

The results of ITU's 2010 ICT Price Basket (IPB) study were released on May 16. The annual study compares and measures fixed telephone, mobile cellular and fixed broadband internet services affordability as a percentage of Gross National Income (GNI) per capita in 165 economies around the world to highlight the difference in prices between developed and developing regions over time.

Relatively speaking, the richest countries in Europe and Asia-Pacific have the most affordable broadband connections while high-speed internet is well out of reach for the majority of consumers living in the developing world said the ITU.

"This year’s IPB figures underline the fact that pricing remains a major factor in perpetuating the 'digital divide' between rich and poor," said the ITU, adding that "IPB results reveal a close link between the affordability of ICT services and national income levels: people in high-income countries pay relatively little for ICT services, while those in the world's poorest countries pay relatively more."

In rich economies throughout Europe, Asia and the Pacific, ITC prices represent less than 1 percent of GNI; in developing countries they average around 17 percent of GNI.

Fixed broadband prices have fallen dramatically over the past two years said the ITU, especially in developing countries. The steep price drop of around 52 percent, however, doesn't necessarily represent affordability cautioned the ITU.

"Even at half the price, the service is often still far beyond the pockets of average citizens" living in the developed world, noted the ITU.

In 32 countries, many of which are UN-designated Least Developed Countries, "the monthly price of an entry-level fixed broadband subscription corresponds to more than half average monthly income. In 19 of those countries, a broadband connection costs more than 100% of monthly GNI per capita. And in a handful of developing countries the monthly price of a fast Internet connection is still more than ten times monthly average income," said the ITU.

An overview of the report can be found on the International Telecommunication Union’s website. The full details and results of the 2010 IPB will be published in September 2011 in the ITU's Measuring the Information Society Report 2011.