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Check Before You Sign – A Guide to ISP Contracts

ISP contract

According to the latest research by Forbes Homes, around 93 percent of US households now have internet access. That makes online connectivity more common than municipal drainage, which is available to about 84 percent of homes in the US. It means that almost every American householder will need to sign a contract with an internet service provider at some point. 

A wide choice of internet service providers

Before we get into the details of what to look out for in ISP contracts, it is worth bearing in mind that US consumers are spoilt for choice when it comes to internet service providers. There are more than 2000 to choose from across the US, and more appear every month. In other words, it is a buyer’s market, and consumers can afford to be choosy. Take some time to research which ISPs service your area, then compare and contrast what they have to offer. Here are some of the important points to consider.

Pricing and hidden fees

In the current economic climate, we all have to manage our money carefully. It is natural that price will be one of the first things you look at when comparing US internet service providers. The providers will know this too, and competitive pricing is one of the main strategies they use to try to gain market share. 

There are a couple of points to bear in mind here. First, be careful about simply choosing the cheapest. Consider the other points we will cover in a moment too, as an extra dollar or two a month could mean far better connectivity, reliability or customer service. It might even result in savings in the long run.

Secondly, remember the old adage that if something looks too good to be true, it probably is. Some less reputable providers tempt customers in with a cheap introductory offer that then increases after a few months. Others offer a seemingly great monthly fee but charge extra for installation or routers, which other providers include for free. 

Internet speed 

Internet speed has always been the most important measure of performance when it comes to ISPs. Today, average internet speeds in the US are 219 Mbps for downloads and 20 Mbps for uploads. That is faster than we could have imagined possible 20 years ago, but our demands have also changed in recent years. 

Even if you have multiple users streaming and gaming at the same time, that sort of speed will be more than enough. However, average speeds can vary significantly depending on where you live. Your ISP contract should be pragmatic about the real speeds you will experience at peak times and should commit to minimum performance levels. This is the part of the contract that you should check closely, as it is more informative than marketing jargon making vague claims of connectivity “up to” certain speeds. 

Watch out for data caps

The average US household consumes 500 gigabytes of broadband data per month. In some homes, that figure will be significantly higher. For example, streaming a two-hour movie in 4K definition will use about 15 GB of data. Other data-intensive activities include video conferencing, using software like Zoom, and online gaming. 

Those numbers are probably much bigger than you thought, so check carefully for any data caps or limits in your ISP contract. Imposing a data cap is one of the ways that some ISPs can offer those ultra-cheap prices. Then when you hit the cap, either your internet speed suddenly drops (a process known as throttling) or you find yourself with an extra charge of around $10 for every 50GB you went over your limit. 

Customer support

Like any other utility, your internet connection is going to have problems from time to time. It is important that when it does so, you get swift and effective technical support. After all, it’s not just a case of watching movies or chatting to friends on social media. More than 20 percent of the US workforce now works from home, at least sometimes.

So check your contract to understand the availability and quality of customer support. Most reputable ISPs have someone available by phone or chat 24/7, so don’t settle for less. Also, look to see if the provider offers compensation for outages that last beyond a stipulated timeframe.


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