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Ookla releases US internet speed report: Getting faster with %40 increase in a year

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As the broadband industry has gotten smaller, average Internet speeds have improved for American consumers.

Over the past two years, AT&T (NYSE: T) has acquired DirecTV; Altice, which owns Suddenlink, bought Cablevision; Frontier (NASDAQ: FTR) bought Verizon‘s (NYSE: VZ) wireline customers in California, Florida, and Texas; and, most importantly, Charter Communications (NASDAQ: CHTR)swallowed up Time Warner Cable as well as Bright House Networks. All of that M&A activity has been good news for American consumers, at least when it comes to broadband speeds, according to Speedtest by Ookla’s U.S. Market Report for the first half of 2016.

Ookla’s latest Speedtest.net report for the US is in, and it’s got some good news: internet speeds have become noticeably faster. Broadband customers across the US are now seeing average speeds over 50Mps down for the first time — specifically, 54.97Mbps, a 40 percent increase over this time a year ago, while upload speeds jumped 51 percent to 18.88Mbps.The US telecom sector has seen considerable consolidation in the past few years, as Ookla notes in the report, with AT&T’s acquisition of DirecTV, and Altice USA’s purchase of Cablevision in back 2015. However, it says this year’s big merger between Charter Communications, Time Warner Cable, and Bright House Networks could have the largest impact.

The biggest bright spot is the growth of fiber-to-the-home (FTTH), or fiber optic connections. That doesn’t include Verizon FiOS, which was first out of the gate. But it seems to have stalled out in growth and isn’t much better or faster than conventional cable these days except on upload speed, as this chart shows:

Ookla Fastest ISPs

Credit: Speedtest.net

The real growth instead is in gigabit fiber optic, with the most notable being the (still not widely available) Google Fiber. The report notes some small cities have local ISPs that have begun to offer fiber connections to the home as well.

On the mobile side, speeds have jumped over 30 percent on the four major US carriers, averaging 19Mbps down in the first half of 2016. AT&T, Sprint, T-Mobile, and Verizon Wireless have all pushed hard to expand their LTE networks. Here, the problem isn’t so much speed as in coverage; getting 10Mbps or 30Mbps on LTE is less important if you can only get 2G or 3G in certain parts of the US, or worse, nothing at all. I’ve reviewed hundreds of phones over the years and have found countless dead spots during testing, even in areas that providers typically say offer the best coverage on the maps they provide to the public. It’s become much better, but it’s a trivial task to find LTE dead spots just outside major cities even today.

Fastest mobile networks

Credit: Speedtest.net

So overall, there’s progress, but unfortunately the US is still running far behind some other nations. We rank just 20th overall in fixed broadband worldwide and a disappointing 42nd on the mobile side. Worse, not everyone in the US is seeing even these speeds; a recent FCC report on broadband progress found that 10 percent of Americans lack access to at least 25Mbps down and 3Mbps, and 39 percent of Americans when focusing specifically on rural customers (though just 4 percent lack access to those speeds in cities).

The report said that fiber optic network deployment “has the potential to bring a quantum leap in speeds to many U.S. markets in the coming years,” but that provider consolidation means there’s less incentive for ISPs to invest in those performance gains. Overall, a decent progress report, but providers have plenty of work to do — especially as people continue to move to an always-on, always-connected world, where streaming 4K video and multiplayer gaming is the norm.

You can read the full Ookla Speedtest.net market report for more details; it includes an interactive map that lets you click on individual cities and states for localized test results.

Disclaimer: Ookla is owned by Ziff Davis, which also publishes ExtremeTech.com.

-The consolidation, along with Alphabet‘s (NASDAQ: GOOG) (NASDAQ: GOOGL) Google Fiber pushing rivals including Comcast (NASDAQ: CMCSA), Charter, and AT&T in markets where they once had monopolies, has resulted in fixed broadband customers seeing a big jump in performance “with download speeds achieving an average of over 50 Mbps for the first time ever,” Speedtest reported. That’s an over 40% increase since July 2015.

Upload speed jumped as well, improving by over 50% since the first six months of 2015, with the average consumer receiving upload speeds of 18.88 Mbps. And it’s not just fixed broadband customers benefiting. Mobile users have seen big gains as well, according to the report, with average download speeds improving by 30% since last year, climbing to an average of 19.27 Mbps.

Image Source: Speedtest.

Competition is a good thing

The various carriers and providers would argue that consolidation has allowed them to invest more in infrastructure. That’s likely true and it certainly will benefit a company like Frontier going forward to have the added customer base it bought in the Verizon deal.

Consolidation, however, is only one piece of the puzzle. A bigger one may well be that increased competition and the threat of even more as technology changes has pushed companies to get faster. That includes Google Fiber pushing Comcast, Charter, and AT&T, but it also involves the fact that the wireless phone carriers have become a rival to traditional internet in some cases — especially for younger users used to watching video on phones and tablets.

Americans demand better

Speedtest, while it did laud the improvement in its report, also threw a bit of cold water on its findings in relation to the internet speeds seen in the rest of the world.

“Competition is a good thing, and while we’re seeing faster performance than ever before, the internet in the U.S. could certainly improve,” wrote the company. “The U.S. still lags from an international perspective, currently ranking 20th in fixed broadband and 42nd in mobile internet performance globally.”

Speedtest noted that in general consolidation has not typically boded well for innovation and increased speeds. In this case, however, competition plus consumer demand may force the broadband providers to continue to raise these numbers.

“U.S. consumer appetite for more speed is insatiable,” wrote Speeedtest. “With the growth of municipal and locally focused fiber deployments, as well as network infrastructure investments from the big ISPs, the U.S. is likely to see continued performance gains in the coming year. Time will tell whether those gains will be incremental or a larger step toward gigabit speeds.”

This is a very strong report and it shows that whether they want to invest in their networks or they have to because of increased competition, the big ISPs have gotten better. Going forward it’s likely that they will continue to improve their offerings or risk losing customers to upstarts like Google Fiber or whatever new technology comes down the pike allowing people to forgo traditional providers.

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