The NY Times reports that only about 25% of all internet traffic now passes through the United States; I had to laugh at this quote:

Internet technologists say that the global data network that was once a competitive advantage for the United States is now increasingly outside the control of American companies. They decided not to invest in lower-cost optical fiber lines, which have rapidly become a commodity business.

Seriously: there is more than enough fiber running through the US. There is a lack of fiber-to-the-home projects, but that doesn’t really have that much of an effect that it alone is responsible for lowering the percentage of traffic through the US from 70 to 25%. The EPIC also offers an explanation:

“Since passage of the Patriot Act, many companies based outside of the United States have been reluctant to store client information in the U.S.,” said Marc Rotenberg, executive director of the Electronic Privacy Information Center in Washington. “There is an ongoing concern that U.S. intelligence agencies will gather this information without legal process. There is particular sensitivity about access to financial information as well as communications and Internet traffic that goes through U.S. switches.”

I can offer my own alternative explanation: it’s the latency, stupid! Where before most servers on the net were located in the States, large companies such as Google and Microsoft are spreading their data centers all over the world to get closer to their users. The US doesn’t come close to housing 25% of the world’s population, so we can expect to see this number go down even further.