Broadband Basics: How it Works, Why It’s Important, and What Comes Next

Answers to baseline questions about internet infrastructure and policy

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Broadband Basics: How it Works, Why It’s Important, and What Comes Next

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Overview

Reliable high-speed broadband is essential to life in the U.S. today. With historic federal investments now available, states are working to expand access to high-speed internet.

Broadband Basics covers network components, technologies, infrastructure, broadband policy, and barriers to access.

Anatomy of the Internet

To understand broadband policy, infrastructure, and technologies, it’s important first to understand how the internet works.

The internet is not, as the old joke goes, a series of tubes. It’s a complex set of interconnected networks—each owned and run by different internet service providers (ISPs)—through which data travels.

But not all networks are created equal. Networks that enable high-speed internet, for example, are known as broadband.

A broadband network is made of three main components.

  • The backbone: Large fiber optic pipes, often buried deep underground, crossing state and national boundaries, that are the main data routes on the internet and the primary path for internet traffic between and within countries.
  • The middle mile (aka “backhaul”): The part of a broadband network that connects the backbone to the last mile.
  • The last mile: The segment of a broadband network that connects a local internet service provider to a customer, such as via a cable line to the home.

All About ISPs

ISPs can be municipal utilities, electric and telephone cooperatives, or private businesses, such as cable or telephone companies.

They fall into three tiers based on how they transport and exchange data among networks, their geographic reach, and whether they pay for “transit” on—meaning to use—other providers’ networks.

Tier 1: Large ISPs that own, operate, and maintain infrastructure, including the internet backbone.

  • Reach: Global.
  • Costs: Tier 1 ISPs coordinate with each other to exchange traffic at no cost. After all, since they all carry roughly the same amount of data on each of their networks, the costs they incur—and the fees they could charge one another—for exchanging data across networks are effectively the same.
  • Examples: AT&T, Deutsche Telekom, Lumen (CenturyLink), Verizon, and Zayo.

Tier 2: Typically, large cable providers and telecommunications companies that exchange data over their networks but must buy transit from Tier 1 ISPs to reach other parts of the internet.

  • Reach: Regional.
  • Costs: Generally, Tier 2 ISPs exchange data for free with other providers in some parts of their networks, but purchase transit services, which allow the ISPs to move user data across another provider’s network.
  • Examples: Comcast, Cox, Frontier, and TDS.

Tier 3: Usually last-mile service providers or those that offer only direct connections to customers.

  • Reach: Local.
  • Costs: Tier 3 ISPs must buy access to the broader internet, either through direct contracts with Tier 1 providers or by buying services from Tier 2 providers that include connections to Tier 1 networks.
  • Examples: All Points Broadband and Ruralband.

Data exchanges across networks occur at internet exchange points (IXPs)—typically large buildings where multiple carriers house equipment to link their networks. The data is transferred using network switches, which operate much like railroad switches, to efficiently move data from one network to another along the most direct route.

How do broadband networks affect user experience?

The slowest link in this system—usually the last mile—determines how quickly content loads on your screen. Two factors determine how slow the slowest link is:

  • Bandwidth: The capability of telecommunications networks to transmit data and signals, measured in bits per second (bps).
  • Throughput: The amount of data that can pass through a communications system. Throughput is a function of bandwidth: the greater the bandwidth, the greater the throughput.

Think of the relationship between these two metrics as a road. Bandwidth is the number of lanes, and throughput is the amount of traffic. The wider the road, the more traffic it can carry at full speed before becoming congested and slowing down.

Remember the backbone? It’s like an interstate, offering high bandwidth. 

And the middle mile might be a state highway.

The last mile is more like a neighborhood street. It’s the narrowest stretch, and therefore the one most likely to be congested. 

Some individual homes may require a line extension—a connection to existing wired broadband infrastructure along the road or to a neighborhood fiber node. This final segment is like a home’s driveway, which links the house to the network of roads.

Even though the last mile is the most likely to experience slowdowns, any part of the network can get congested, leading to endless spinning wheels and buffering.

How do you access the internet?

The content on computers, phones, tablets, and other devices is largely generated by edge providers—large retail, social media, technology, or video streaming companies (such as Google, Netflix, and Facebook) or individuals who offer content, such as blogs or websites.

Their data reaches users via content delivery networks (CDNs), systems of servers typically owned by large technology firms such as Amazon CloudFront and Akamai. CDNs function as data warehouses, storing copies of web content in various locations to shorten the distance between users and the content they want. This arrangement cuts the time it takes for data to load after the user clicks a link.

Let’s Connect

Understanding the technologies that allow Americans to access the internet is crucial to effective broadband policy.

Internet service providers (ISPs) rely on a variety of technologies to connect users to the internet:

  • Wireline connections.
  • Fixed wireless connections.
  • Satellite connections.

These technologies vary in terms of speed—the rate at which they transmit data—and in terms of latency, the amount of time it takes data to travel to its destination and back along the network.

Wireline connections

Wireline connections are the most common type of home broadband connection in the U.S.

They involve three main types of physical lines running to a structure.

Cable internet service is provided by cable television companies over a hybrid network, meaning it uses two main types of wires:

  • Fiber lines go to neighborhood nodes.
  • Coaxial cables transmit data from the nodes to residences and businesses.
  • Primarily available in urban and suburban areas

Digital subscriber line (DSL) service uses a two-wire copper telephone line:

  • Allows consumers to simultaneously use the internet and a landline telephone.
  • Slowed by distance—the farther a signal must travel, the slower it will be.
  • The oldest internet service technology in the U.S.—losing customers due to slow speeds.

Fiber to the home (FTTH), aka fiber to the premises (FTTP), relies on fiber optic cables:

  • Fastest speeds with low latencies.
  • More future-proof than the other technologies and can be continually upgraded for faster service.
  • Federal and many state broadband programs prioritize fiber investments.

Federal investments made through major legislation in 2021 and 2022 prioritize fiber infrastructure projects, and in response leading ISPs committed to invest $60 billion over three years starting in 2022 to build out FTTH.

Wireless connections

Wireless internet involves three main types of technology.

Fixed wireless connections involve beaming signals through the air from a tower and are frequently used in remote or rural areas with low housing density.

As with DSL, speeds get slower as the user gets farther from the transmitter. These connections cover fewer than half of U.S. households but can provide a reliable last-mile option for rural areas.

Satellite connections are another alternative for rural consumers, but they can be expensive and aren’t easy to distribute widely. These connections come in two types:

  • Geostationary technologies involve individual satellites orbiting at more than 22,000 miles above the Earth.
  • Low-Earth orbit broadband uses constellations of satellites in orbit 200 to 800 miles above the Earth.
Close-up of a person’s hand holding a white smartphone while a sunny orange glow shines through a window in the background.
Myshkovsky Getty Images

Finally, mobile connections are a crucial part of today’s world.

  • More than 83% of Americans access the internet via smartphones, tablets, and other mobile devices.
  • Mobile devices are the only means of internet connection for 15% of Americans.

Mobile communications include two main technologies.

  • 4G (fourth generation, includes LTE)
    • Usually offers speeds above 1 megabit per second (Mbps).
    • The most common mobile technology.
  • 5G (fifth generation)
    • Usually offers speeds of 1 gigabit per second (Gbps) or higher.
    • In the process of being deployed on a large scale by providers.

Wireless infrastructure depends on spectrum—electromagnetic radio frequencies—to transmit data to end users’ devices. Spectrum may be “licensed,” that is, specific frequencies granted by the Federal Communications Commission (FCC) to individual ISPs for their exclusive use, or “unlicensed,” meaning available for use by anyone.

Different technologies require different spectrums. For instance, 5G uses high frequencies that enable data to travel faster but not as far as at lower frequencies. To make up for those distance limitations, 5G service requires a greater density of transmitters and receivers to carry data than do 4G and earlier generations of wireless service that rely on lower frequency spectrums.

Laying the Groundwork

Americans view billions of web pages, stream millions of videos, and spend hours scrolling through social media every day.

And all this connectivity relies on the physical infrastructure of the internet—cables, wires, servers, routers, network switches, and more.

Building, connecting, and maintaining that infrastructure is complicated, involving a host of steps, such as attaching wires and other equipment to utility poles and siting wireless facilities.

First step: Get access to the land

To build broadband networks, internet service providers (ISPs) need to install infrastructure on public and private land. And for that, they need permits or easements.

Permits authorize ISPs to build in public areas (streets, sidewalks, trails, highways) or enter public areas to build or maintain infrastructure.
Getty Images
Easements granted by private property owners, easements give an ISP the right to use and enter the property for a specific, stated use. Negotiating easements can add time and cost to a project, so many states have adopted policies to streamline the process.
The Pew Charitable Trusts

Next step: Lay the groundwork

Fiber and other wired infrastructure are either placed aerially on poles owned by telephone or electric companies or buried underground.

Aerial installations involve “make ready” work, in which utility companies and ISPs ensure that the poles are ready to have new equipment attached.

For underground deployments, fiber lines and other broadband cables are run through conduit—plastic tubing that protects the lines from damage. An ISP may add excess fiber or conduit in anticipation of future needs as either “dark” or “lit” fiber.

  • Dark fiber is not yet connected to the equipment necessary to supply internet service.
  • Lit fiber is connected and transporting data.

What about wireless?

Fixed and mobile wireless services use towers and antennas. The sites where these facilities are placed fall into two categories.

Macrocell Sites

  • Provide coverage to large areas.
  • Often on telecommunications towers, although may be co-located on other structures, such as water towers.
  • Require “line of sight” between towers for signal to travel from site to site unobstructed.

Microcell Sites

  • Provide coverage to a small area.
  • Needed for 5G mobile wireless and wi-fi service.

Zoning for wireless

Both macrocell and microcell sites are usually subject to local zoning requirements, which address location, safety, and aesthetics. Common zoning regulations include:

  • Tower height limits.
  • Camouflage requirements (for example, when towers look like artificial trees).
  • Co-location—placing new equipment on existing towers or other structures, such as water towers, rather than erecting new towers.

To reduce the cost of deploying wireless service, many states have limited local control over the size, placement, and scale of wireless infrastructure. In addition, the FCC has pre-empted local control over microcell zoning.

Challenges in rural infrastructure

States are increasingly looking to improve the availability of broadband, particularly in rural and unserved communities. These areas often lack a sufficiently dense customer base to entice commercial ISPs.

New federal laws have made billions of dollars available to states to expand broadband infrastructure. But no single solution can connect all communities to high-speed, affordable internet.

Among the strategies now being deployed are:

States lead on expanding broadband

Because no single approach will work for every state or community, states are creating broadband programs that meet their unique needs. These programs will also help states take advantage of the billions of new federal dollars available.

Successful state efforts to expand broadband access do three key things:

  1. Establish broadband offices.
  2. Provide planning and technical help.
  3. Create competitive grant programs.

Together, these steps foster community engagement, enable effective stewardship of public funds, and ensure that state and local activities remain focused on achieving universal broadband access.

Barriers to access

American life—from work to education to health care—is increasingly moving online. The COVID-19 pandemic accelerated that process and underscored the need for reliable, consistent high-speed internet access for all. Access refers to the existence of infrastructure to support high-speed internet service in a given geographic area.

But more than 40 million Americans lack access to home broadband. What’s more, nearly 1 in 4 Americans have not “adopted” broadband (subscribed to home internet) when a connection is available.

Adoption rates are even lower among adults who are low-income, rural, non-White, 65 and older, or not college-educated.

Three main factors affect internet adoption

Research has shown that cost is the primary barrier for low-income households. Pew Research Center found that 45% of people who do not have broadband cite the high monthly cost as a reason. And 37% cite the cost of a computer.

Smartphones, Financial Barriers, and Outside Options Among Reasons for Not Having Home Broadband

Percentage of nonbroadband users in the U.S. who cited each a reason or as the most important reason

How much do American households pay for broadband?

Although nationwide data on pricing is limited, estimates of the average monthly bill for service range from less than $50 to nearly $70. And that doesn’t include additional one-time or monthly fees, which could bring bills up to an average of $85 a month.

High costs leave low-income households at a disadvantage, worsening inequities and deepening the digital divide.

Addressing affordability requires a combination of approaches:

  • Supply-side solutions to reduce the cost of building networks and delivering service.
  • Demand-side interventions such as policies and programs that help low-income consumers cover the cost of connections and devices.

What’s Next

Want to keep up with more broadband policy news and research? Join our email list to stay on top of our newest research and recommendations.

Find more in-depth information on our Broadband Expansion page.

Endnote

National Homeownership Month

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