Press Release

California Community Foundation and Digital Equity LA have Released a New Report on Internet Service Price Disparities in LA County

Press Release | October 12, 2022

Report finds that internet is more expensive and slower in high poverty neighborhoods; while wealthier neighborhoods are being offered better pricing for high-speed internet.

Los Angeles, CA — The California Community Foundation (CCF) Digital Equity Initiative and Digital Equity LA have released a report today that sounds the alarm on disparities in pricing for internet service in LA County. The report documents the prices offered to residents of diverse neighborhoods across the County. Findings include that Charter Spectrum, the monopoly internet service provider (ISP) in LA County, offers better pricing for high-speed internet in wealthier neighborhoods. While high poverty communities are being charged higher prices for the same or inferior service.

“The findings of this report are concerning and raise significant red flags about the implications of those pricing disparities on the effectiveness of current public investments to close the digital divide,” said Antonia Hernández, president and CEO of the California Community Foundation. “Post-pandemic, equitable access to a high-speed and reliable internet connection at a price that is sustainably affordable remains a vital necessity for full participation in society.”

CCF and Digital Equity LA are calling on leaders in Los Angeles County, cities across the County, the California Public Utilities Commission (CPUC), and the California legislature to investigate these pricing disparities and their implications for public investments in closing the digital divide.

“This report uplifts very sobering information we know all too well from our partners and network that students and families of color and those living in poverty across Los Angeles are facing disproportionate barriers to accessing quality and affordable internet,” Ana Teresa Dahan, managing director GPSN. “We call on our government leaders to hold internet service providers accountable for these grave inequities.”

Digital Equity LA and CCF Digital Equity Initiative documented advertised service options at a sample of 165 residential addresses across the County by shopping for service on ISP’s sales websites. The monopoly provider in much of LA County is Charter Communications, operating as Spectrum. According to Charter’s filings with the CPUC, it serves approximately 97% of households in the county. The next largest provider, Frontier, serves 21%. Therefore, most of the pricing data included in this report is for Charter Spectrum service.

Topline findings include:

  • Most Angelenos are subject to a broken monopoly market for broadband: Charter Spectrum is the only internet service option for the majority of addresses examined for this study.
  • Charter Spectrum’s advertised prices vary widely from neighborhood to neighborhood.
  • Charter Spectrum’s standard service tier is “Internet Ultra,” its branded service offering of up to 500 megabits per second (Mbps) download speed. Internet Ultra is the only tier of service offered at every address in this study, with slower “Internet” (300Mbps) offered to about three-quarters of households and “Internet” (100Mbps) advertised to less than a quarter of households.
  • Charter Spectrum consistently offers better pricing, under better terms and conditions, to residents in low poverty neighborhoods than those in high poverty neighborhoods in LA County. Charter’s low-cost plans are not consistently advertised to households in high-poverty neighborhoods. Charter Spectrum’s promotional offers – guaranteeing a period before prices will increase – are for two years in wealthy communities, but for just one year in high-poverty communities.

“As a single parent to three boys who can only afford an inferior internet plan that is not fast or reliable, I am furious to find out about the lower rates that Spectrum is offering to wealthy neighborhoods,” said Yesenia Miranda Meza. “Like everyone else, I depend on internet access to do my everyday work and manage our lives. If I lived in a wealthy neighborhood, we would have a fast and reliable internet plan from Spectrum for less than half of what they offered me.”

She went on to share, “Internet has now become a necessity and multi-billion-dollar companies should not be allowed to continue to prey on us low-income, working-class people, who are simply trying to get by. This is an atrocity, and it should not be allowed.”

“So much of what enables people to thrive in society is now inextricably tethered to the internet – education, finding and applying for jobs, social connectivity, telehealth, and applying for programs such as Medi-Cal and CalFresh – all things we know are important drivers of health and wellbeing,” said Louise McCarthy, president & CEO, Community Clinic Association of Los Angeles County. “Universal access to fast and affordable internet is essential to health and wellness. We must hold ourselves accountable to the promises we made to ensure an equitable COVID recovery. This includes rectifying the inequities in access to the internet that were revealed so glaringly by the pandemic and ensuring all Angelenos can access high quality, high speed, affordable internet.”

To read the full report, Slower and More Expensive: Sounding the Alarm about Disparities in Advertised Pricing for Fast, Reliable Broadband click here.

MEDIA CONTACT:

Paula Valle Castañon at pvalle [@] calfund [.] org or 213.452.6233

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The California Community Foundation (CCF) has served as a public, charitable organization for Los Angeles County since 1915. Its mission is to lead positive systemic change that strengthens Los Angeles communities. CCF stewards $2.3 billion in assets and manages 1,900 charitable foundations, funds and legacies. For more information, please visit staging5.calfund.org.

CCF launched the Digital Equity Initiative in 2021 as a multi-year project to advance system change solutions to ensure equitable access to fast, reliable, and affordable broadband for every resident of Los Angeles County. More at staging5.calfund.org/digital-equity-initiative/.

About Digital Equity LA
Digital Equity LA is a coalition of more than 40 community-based-organizations working in Los Angeles’ communities delivering vital education, housing, immigration, health care, immigration and civic engagement services, supporting vulnerable communities in Los Angeles, and working together to advance digital equity as a necessary precondition to meet their core missions. The CCF Digital Equity Initiative provides financial and programmatic resources in support of Digital Equity LA. More at www.digitalequityla.org.