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Did the Price of the Internet Drop?

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1 Author(s)
Greenstein, Shane ; Kellogg Graduate School of Management

No statistic would seem as important to know as the price of the Internet. You might reasonably respond, How can the Internet have a price attached to it? As it turns out, there are many such prices. A particularly interesting one is the consumer price index (CPI) for Internet access, which focuses on the retail price of a household connection. This price index does not get enough attention because observers confuse future opportunity with recent history. One other thing motivates an examination of this index. There is a big debate in the US about whether the broadband market has been organized intelligently. Economic statistics can inform policy debates, that is, if they get interpreted the right way. However, and this is my point in this column, the index is easy to misinterpret. It is worth a close look.

Published in:

Micro, IEEE  (Volume:27 ,  Issue: 3 )