Most people shopping for home internet don’t really know what they’re buying when it comes to speed. The internet provider offers a high-tier plan—like “Gigabit”—and leaves you wondering: Do I need this for working from home? For streaming? For keeping everyone connected at once?

Their proposition: upgrade to a faster speed—otherwise, you’re someone who takes risks and doesn’t mind an interrupted internet experience.

That’s misleading. And it’s by design.

I’m a former executive at one of the largest internet providers in America. Selling higher speeds is the #1 way internet companies get you to pay more than you need to—and it works for them. But in most cases, faster speeds don’t actually improve your experience. Even if you’re enjoying new competition in your area you may still be overpaying.

The tl;dr: Choose the lowest speed plan offered (100–300 Mbps). It’s more than enough to power your entire household of connected devices for remote work, gaming, and video streaming.

Are you shopping for home internet? Check out Wifi Shark, our website dedicated to helping you save on home internet. With new plans starting at $30/month, there has never been a better time to lower your internet bill. Please support our mission by purchasing through our links—it really helps!

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Lower speed tiers are much faster than advertised

Let’s take a look at Xfinity, one of the most widely available ISPs in the U.S. Like many providers, Xfinity offers multiple speed tiers, but the way it describes those options downplays how much you can actually do with the lower speeds. Here’s the one thing you should know before we go any further:

A single Netflix HD stream only needs 5 Mbps.

And it’s a perfect benchmark for measuring internet speed. Gaming and videoconferencing require a similar amount of bandwidth, so using “Netflix streams” gives us an idea of how much activity each plan can support.

If you were relying on Xfinity’s advertising and wanted to make sure your Netflix worked consistently, I wouldn’t blame you for choosing a 1 Gig or 2 Gig plan. After all, I want my internet to work with “extreme speed,” too.

The reality is different—and choosing a lower internet speed can support dozens of high-quality, lag-free, and superfast HD streams.

Certain points in Xfinity’s advertising are particularly harmful:

• 400 Mbps being necessary for HD quality
• 600 Mbps being necessary to stream on multiple devices
• Underrepresenting the number of devices that can be used for each speed tier

To be fair, faster speed does make a difference for one thing: downloading or uploading big files from the internet. If you’re someone who regularly moves large files (usually for a professional reason), a faster plan can save you time. A 30-minute HD video file takes 2 minutes to download over 100 Mbps, but only 12 seconds over 1 Gig. But this isn’t a good reason for most people to upgrade their internet speed.

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Americans are buying more speed than they need

These sales tactics are driving millions of Americans to overpay for internet speeds they don’t need. Gigabit plans can cost an extra $50 or more than lower-speed options. One regional fiber provider, Ziply, demonstrates this pricing strategy.

Driving consumers to choose premium speed tiers has proven extremely lucrative for ISPs. Frontier, another regional fiber provider, has been so successful that it now drives over 60% of its customers to gig-speed plans, the highest of which (7 gigabit) starts at $110/month.

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Why is this happening?

To understand why ISPs sell Americans multiple speed plans, we need to take a step back to the beginning of the home internet industry. As you’ll see, there was initially a practical reason for introducing speed tiers—but over the last 15 years, the rationale has shifted completely to marketing.

1990s: 56K and the dawn of home internet

Remember when it would take forever for a simple image to load? ISPs in the 90s would advertise that you could “download pictures and information in minutes” (a big deal then), access chat rooms, and use instant messaging. Terms like “lightning fast” were used to distinguish 56K service from older technologies like 28.8K.

There were no speed tiers, only internet providers trying to deploy the latest technology—all of which were slow compared to today.

2000s: Speed tiers introduced for network management

Internet became a lot faster in the 2000s. Going from 56K to even 1 Mbps was transformative—activities that used to take over an hour, like downloading a 3-minute song, could be accomplished in under a minute. The internet could now handle simple video clips, and services like YouTube emerged, creating the foundation for the streaming platforms we use today.

The 2000s were also a time of real technological constraints for internet networks. ISPs introduced speed tiers to navigate these limitations. Tiered pricing helped ISPs segment heavy users and incentivize lighter users to choose lower-speed plans, minimizing congestion and managing traffic efficiently.

2010-today: Speed tiers become a marketing tactic

By the 2010s, many of the technical limitations that once justified speed tiers had largely been resolved. Internet speeds surged to 100 Mbps or more, and eventually gigabit plans (1,000 Mbps) became widely available. Any of these speeds could deliver the music, video, and gaming applications we enjoy today.

In line with Americans’ internet usage, the FCC started defining broadband internet as 25 Mbps—a speed which could “enable users to originate and receive high-quality voice, data, graphics, and video telecommunications.” This definition was only updated to 100 Mbps in 2024.

However, instead of scaling back the tier system, ISPs shifted its purpose.

With modern internet infrastructure now capable of delivering high speeds to every connected home, ISPs began using speed tiers as a pricing strategy. They positioned faster plans as essential for a “smart home” or a “fully connected family,” while labeling lower-speed plans as “basic” or “limited”—even though those plans are more than sufficient for most households.

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I’m not the only expert saying this

Some of the most experienced voices in the telecom industry are calling out the marketing hype around faster speeds.

Take Scott Imhoff, SVP of Product Management at Cambium Networks, a major global manufacturer of wireless broadband infrastructure. With decades of experience deploying network solutions, Imhoff cautions against the push for faster speeds:

“I think [faster speed] is more marketing spin on behalf of the fiber industry than it is anything else. The rapid pursuit of gigabit speeds is overhyped. As [consumers] get charged more, their usage may not increase despite having the capacity to do so.”

In other words, Imhoff says people are increasingly paying for faster speeds they don’t actually need. Most households don’t need gigabit speeds— and those who pay for it are unlikely to see any real return on their investment.

Liam Bal, CEO of international ISP Spintel, echoed this:

“There’s a deeply ingrained perception that higher speeds mean better performance. In reality, a typical household of one or two users streaming, video conferencing and browsing would be fine with a 50 Mbps plan.”

“Many professionals overestimate their speed needs when a well-optimized 50 or 100 Mbps plan is more than sufficient. Providing better education on what speeds are actually needed for daily activities can help customers save money and feel more confident in their choices.”

A study from The Wall Street Journal, conducted in collaboration with researchers at Princeton and the University of Chicago, backed up these claims with real data. The study tracked 53 households and found:

• Users utilized only a fraction of their available bandwidth, even with multiple HD streams running simultaneously.
• In one test, users running up to seven simultaneous streams averaged just 7.1 Mbps of actual usage.
• Paying for more than 100 Mbps delivered marginal benefits. Picture clarity didn’t improve significantly, nor did video start times.
• One participant on a 15 Mbps plan had no problem handling multiple streams.

Together, these insights paint a clear picture: what began as a technical necessity for tiered speed offerings has turned purely into a marketing tactic, and that most households would be perfectly served by a 50 or 100 Mbps connection.

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Where do we go from here?

There’s one ISP doing things differently.

Sonic, a California-based internet provider, avoids selling customers different speeds. They offer one plan: 10 Gigabits for $49.99/month. There are no tiers—just one offer that provides the same maximum throughput to every user.

“Sonic doesn’t believe in tiered internet services; we are dedicated to giving you the fastest service available.”

Practically speaking, users won’t notice any difference in streaming quality whether they’re on a 100 Mbps or 10 Gigabit connection. But for the internet industry, Sonic’s approach is disruptive.

We welcome Sonic’s simple and transparent model as an example of what internet offers could look like in the future.

What began as a way to manage real bandwidth limitations has transformed into a marketing tactic to increase ISP profits. In the future, I’ll explore what’s being done to address this issue from a policy perspective. But for now, to answer the question “what internet speed do I need?”—I hope you have everything you need to make an informed decision.

Are you shopping for home internet? Check out Wifi Shark, our website dedicated to helping you save on home internet. With new plans starting at $30/month, there has never been a better time to lower your internet bill. Please support our mission by purchasing through our links—it really helps!

For more tips, check out our shopping guide to learn about other ways to lower your internet bill.