How to calculate unit price for your broadband

Comparing broadband packages can be like comparing apples and oranges. Different broadband technologies price things differently – some include a phone or video options (akin to traditional cable TV). Some options require equipment and installation fees or early termination fees. But beyond that – the monthly options are different. Some providers look only at speed and some look also at usage. Today we’re going to take a look at the monthly options especially cost based on speed and/or usage.

  • Speed provides the capacity to interact online. The FCC has a guide to help track speed requirements by activity. For example, streaming an HD video requires 4 Mbps connection (download). To figure out your speed requirement, you’ll have to consider all users of broadband – every laptop, smartphone, ipad and the Internet of things for each member of your household or office.
  • Usage tracks accumulation of data. For example, an HD movie may be 3 to 5 GB.  It’s like a cup that gets filled. Depending on you provider you may pay more if you overfill your cup, your connection maybe slowed down if your cup gets filled or your provider may not have data caps (aka data allowances) so you can interact online (download or upload) without limitations. Many people have experience with usage on mobile contracts – but cellular providers aren’t the only ones that track and charge by usage.

We looked a cost for a number of different national and state broadband providers. This is an illustrative list – not comprehensive. (See table and chart below.) Some technologies (such as fiber) don’t track usage. Others focus on use as much as speed.

How are the costs calculated?

  • Cost/Usage — Usage cost per GB  ($60 for 10 GB = $6 per GB)
  • Cost/Bandwidth (Connection speed) — Bandwidth cost per MB ($60 for 25 Mb = $2.40 per Mb

With the help of some friends, we have created a broadband cost analysis spreadsheet that you can use to help calculate the unit cost of your broadband.

Check it out – and feel free to send us your results. Just send us the info required on the spreadsheet and your location. If we get enough, we’ll expand our comparison.