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Insight • Data • Economics • Analysis
Monthly Personal Consumption Expenditures on Internet Plateaued Since 2016
Many broadband expansion discussions are driven by the expression “build it and they will come.” While there is a continued push to build more broadband infrastructure, research continues to indicate we need to also think about the cost of internet services for the consumer. Looking at trends in household internet expenditures allows us to see how consumer spending on internet services may be related to future broadband expansion and adoption trends.
Figure 1. Monthly Personal Consumption Expenditures on Internet Per Household, 1997-2021
Note: Average household internet expenditures are calculated using the number of total households in the state, not just those with an internet subscription.
In the Great Lakes region, monthly personal consumption expenditures on internet per household went through a period of acceleration from 2006 to 2016 but has since plateaued. For example, the average household expenditure on internet in Wisconsin in 1997 was $2.33 per month and rose to $29.38 per month in 2021. Most of that growth happened between 2006 and 2016 when internet expenditures increased from $8.93 per month to $26.26 per month. This leveling off in average household spending on internet services could be a sign of little change in broadband adoption rates in more recent years. Is the broadband market saturated? If broadband adoption rates hold steady, we are not likely to see big leaps in state internet personal consumption expenditures.