News
A new study has found that moderate and low-income neighborhoods pay a higher percentage of their income for broadband of less quality.
By: Brad Randall, Broadband Communities
The Federal Reserve Bank of New York has just released a study with some startling finds regarding broadband inequities.
The study, titled “Broadband Affordability: Assessing the Cost of Broadband for Low-and-Moderate Income Communities in Cities,” was released in September. It found that low and moderate-income communities pay a higher percentage of their income for broadband.
According to the numbers released on the New York Fed’s website, low and moderate-income communities pay an average of 2.43% of their income for broadband services. By comparison, households in wealthier areas pay an average of only 0.51% of their income for broadband, a summary of the study reported.
The study’s findings do not mince words, either.
“Compared to the overall population in metropolitan areas, low-and-moderate income households pay more as a share of their income for broadband and other utilities,” read one section of the study’s findings. “Particularly, they pay over four times as much for broadband, more than twice as much for utilities, and almost twice as much for rent.”
That’s not the only gap revealed in the study’s findings.
“In cities where broadband is less affordable, households are more likely to use slower or lower-quality plans, limiting their access to online services,” said the New York Fed’s website.
Study highlights need to support digital access
Additionally, a summary of the study also noted that data on broadband pricing is scarce in rural areas.
According to the New York Fed, such a finding underscores the need for localized pricing data to support digital access.
New York Fed’s team focused on community development conducted the study.
The team has a mission to promote economic growth in the Federal Reserve’s Second District, which includes New York State, parts of New Jersey, Connecticut, along with Puerto Rico and the U.S. Virgin Islands.
“As part of that work, the team has been studying access to broadband, which can open doors to jobs, financial services, education, and healthcare,” the New York Fed’s website also stated.
