Comment Why Americans pay too much for too little (Score 2) 353
Telephone service in the USA is granted monopoly service districts by the 50 state governments to one or more telephone companies within each state. This originally was to encourage the provision of local telephone service when telephony was relatively new (more than 100 years ago). Companies, such as AT&T, operated local districts and franchised technology to other local providers. AT&T began selling long distance (between local districts) in 1885 and coast to coast long distance in 1915. The Kingsbury Commitment (1912) provided for interoperability between telephone networks. Over time, holding companies (including AT&T) acquired local providers and created large multi-state networks. [End of the Line, by Leslie Cauley]. So while the federal government may talk of improving things, the fundamental problem is the 100+ year old state monopolies that inhibit competition in telephone service.
Cable television service (including internet) in the USA is regulated by the 50 state governments. However, the (federal) Cable Communications Act of 1984 [http://en.wikipedia.org/wiki/Cable_Communications_Act_of_1984] has been both positively and negatively disruptive. The act was used by cable companies to force state and local government to provide right-of-way access to customers. Either by leasing government owned right-of-way or by forcing electric power companies to lease space on neighborhood overhead power poles. (Note: power companies also have state granted monopolies, which allowed the state governments to force compliance.) Initially there were many providers and a great deal of competition. The problem is the act allowed for Cable Television Franchise Fees [http://en.wikipedia.org/wiki/Cable_television_franchise_fee]. These fees are based on gross revenue collected by the cable company from customers within a local government (ie city, county, or parrish). The local governments discovered that competition drives down prices, which in turn reduces these franchise fees. Thus, local governments have been discouraging competition amongst cable companies.
This is why Americans pay too much money for too little bandwidth.