Why Is My Home WiFi Flaky?

I spent probably way too much on an Apple Time Capsule a couple years ago. In an attempt to get my money's worth, I have been trying to get alot of use out of it. Its supposed to do alot: dual band (2.4 and 5 GHz) WiFi, Gigabit Ethernet, 1 TB network-shared hard drive built-in, and a host of other Appley features. Since nearly every WiFi device is compatible with 2.4 GHz, I've left it in that mode for those couple years. The coverage is flaky, however. Videos studder, even when I'm playing them from a share from another computer in the house, and sometimes connections just drop. In an attempt to find out why, I read up on and downloaded a free program called InSSIDer which produces a handy graph of all the WiFi networks in range and what channel they're on. Here's what I found:

2.4 GHz Networks

5 GHz Networks

(Network names are obfuscated to protect the innocent) There are multiple, overlapping networks in range at every available channel in the 2.4 GHz spectrum. While the WiFi specs have algorithms in place to continue operating in spite of all the interference, they're pushed to the limit by all the overlapping networks. By contrast, there are far more channels in the 5 GHz spectrum and only a single network in range. A 5 GHz network in my house could easily operate without any interference from neighborhood WiFi networks.

Luckily, or so I thought, the Time Capsule supports 5 GHz WiFi, as well. As I found when I switched it over to 5 GHz mode, however, the performance was dismal. Despite having no other networks interfering with it, speeds and reliability in 5 GHz mode were even lower in some cases than in the overcrowded 2.4 GHz mode. It was actually worse when my laptop was in the same room as the Time Capsule, so range isn't the cause. After using jperf to take some actual throughput measurements at a few places in the house and comparing them to what competing wireless routers can do (2-7x faster in on-line reviews), I've decided to retire the Apple Time Capsule. Since I've got the Windows Home Server handling backup of both PCs and Macs in the house, now, even its use as a Time Machine backup target is no longer relevant. What a colossal waste of money.