[1st-mile-nm] 8 Surprising Findings About the Broadband Economy

[Richard Lowenberg]

 The following article in Government Technology magazine is by
 friend and broadband activist/advisor, Craig Settles.
 It may be of most interest to those of you involved in the
 economic development aspects of community broadband networking.
 The report referred to at the article's end can be found at:
      www.cjspeaks.com/msp/IEDC2011.pdf

 RL
 -------

 8 Surprising Findings About the Broadband Economy (Opinion)

 http://www.govtech.com/e-government/8-Surprising-Findings-About-the-Broadband-Economy.html

 December 15, 2011 By Craig Settles

 Plenty of articles have been written that assert one of the main 
 benefits that broadband delivers is the ability to impact economic 
 development. However, are we getting the complete picture of what it 
 takes to achieve this goal?

 I don’t think we are. The absence of key details impedes communities’ 
 attempts to generate economic outcomes.

 Economists, the FCC, a parade of private-sector companies and industry 
 trade associations are frequently cited — along with all sorts of 
 numbers that claim to prove the economic value of broadband. But one 
 source it seems you don’t see enough is economic development 
 professionals, the people who work day in and day out to save, maintain 
 and grow local economies.

 Several years ago I started partnering with the International Economic 
 Development Council (IEDC) to take an annual survey of professionals in 
 this field. I’ve posed to them the commonly referenced economic outcomes 
 and the main broadband issues in order to learn how accurate they think 
 the conventional wisdom of the moment is. Often the data contradicts the 
 assumptions policymakers make about broadband.

 The U.S. stimulus of 2009 awarded public, private and nonprofit 
 organizations more than $7 billion to build new broadband 
 infrastructure, create public computing centers and implement broadband 
 adoption programs. Hundreds of millions more has been spent by private 
 companies and other federal agency sources. Improving economic 
 development is a driving force behind these investments.

 It’s a little early in the infrastructure deployment process, though, 
 and only a portion of the stimulus checks have been issued. That made it 
 difficult to use this year’s survey to gauge the impact of 
 stimulus-funded networks on local economies. But I did want to determine 
 what economic outcomes we can hope to achieve in the next two or three 
 years. My survey produced results that reveal several clues.

 Here’s a sampling of this year’s findings and some of my thoughts on 
 what these numbers signify:

 1. Rural economic developers appear to be well ahead of their urban 
 counterparts in the area of planning. Fifty-eight percent of rural 
 respondents either have broadband strategies and tactics worked into 
 their economic development plans, or are writing plans currently with 
 these elements. Only 39 percent of urban respondents have done the same.

 Given reports this year that many rural communities are shrinking and 
 some are near death, it makes sense they’re being more proactive; they 
 see broadband as the last best hope for survival. That said, urban areas 
 shouldn’t get complacent about this type of planning. Broadband doesn’t 
 impact economic development without planning.

 2. “We need a gigabit” has become the rallying call for broadband 
 supporters everywhere; rural survey respondents say that 100 to 120 Mbps 
 is the minimum they’ll need during the next three years to impact their 
 local economies.

 I’m bullish on gigabit networks being a national goal, but this isn’t a 
 universal need at the moment. A 100 Mbps network in small towns and 
 rural counties has fewer concurrent network users to support than 
 mid-size and large urban areas, so rural areas can be content with 100 
 Mbps. The reality is, a fiber network with smaller capacity is 
 relatively cheap to ramp up to higher bandwidth.

 3. While the FCC and other policymakers continue to try to make a silk 
 purse from a 4Mbps sow’s ear, economic development professionals aren’t 
 buying it. At least 92 percent see no economic impact coming from this 
 minimum national “standard.”

 4. “Finding a job” is one of the most frequently cited personal 
 economic benefits of broadband for low-income populations. Economic 
 development professionals, though, rate it at the bottom of the list of 
 potential economic outcomes.

 When finding a job is perceived as the major economic goal, the 
 tendency for policymakers is to champion less robust networks, and 
 computing devices with less horsepower and tiny screens. How much 
 capacity do you need to scan job listings and send email? But when 
 communities have large numbers of people with limited or obsolete 
 skills, the greater goal is to use broadband to significantly beef up 
 their skills or retrain them for different, more financially rewarding 
 industries. This means distance learning, video and other complex 
 high-bandwidth applications.

 5. As expected, fiber is clearly seen as the leading broadband 
 technology to attract businesses to a community. However, wireless is 
 viewed as a strong contender for increasing the number of startups in a 
 community.

 6. Not all wired broadband technologies are equal. Whereas fiber 
 networks are clearly viewed by survey respondents as having a greater 
 impact than wireless on a range of economic outcomes, cable is viewed as 
 only slightly more effective than wireless despite the industry’s PR and 
 marketing efforts.

 The primary message here is that, if communities have a choice they 
 should go with fiber if it can be afforded. But if their only choice is 
 cable or wireless, they might want to evaluate their wireless options. 
 Stakeholders also should remember that not all wireless is equal, 
 either. Rick Harnish, president of the Wireless ISP Association (WISPA), 
 lays out the differences and why they matter in this interview on the 
 radio talk show Gigabit Nation.

 7. Perseverance is still important. Although 19 percent applied and 
 didn’t win a stimulus grant, another 11 percent whose communities also 
 didn’t win kept fighting for money and got their projects funded through 
 state or other federal grants.

 8. As the second decade of the new millennium moves along, 7 percent of 
 respondents still only have dialup as their broadband option; 13 percent 
 of rural respondents say they don’t expect to ever have broadband 
 sufficient enough to impact economic development.

 You can download the full survey analysis report . Every community is 
 different, of course, so look at these findings as a starting point to 
 extensive analysis of local conditions and broadband needs. What’s also 
 informative is reading the written comments  of 169 of the survey 
 participants who offer advice on getting better broadband into 
 communities that need it.



 Craig Settles, host of radio talk show Gigabit Nation , is a broadband 
 industry analyst and consultant who helps organizations develop 
 effective broadband strategies . Follow him on Twitter (@cjsettles ) or 
 via his blog .




-- 
 Richard Lowenberg
 1st-Mile Institute
 Box 8001, Santa Fe, NM 87504
 505-989-9110 / 505-603-5200
 www.1st-mile.com
 rl at 1st-mile.com