Broadband for America Study Shows Importance of Investment
WASHINGTON, DC – Today, the Broadband for America (BfA) coalition released a new study that shows the important contributions to the U.S. economy made by private investment in information and communications technology.
The study, which was conducted by Robert W. Crandall and Hal J. Singer – both experts in the economics of the telecommunications industry – shows that the massive investments made in mobile and wired Internet capacity by the major network providers has created hundreds of thousands of jobs over the past six years and the expected capital investment over the next few years “would create approximately 509,000 jobs relative to a world without such investments.”
The authors caution that the explosive growth in broadband access will be severely limited if “new regulatory changes undermine the incentives of broadband service providers to continue to invest.”
Singer and Crandall quote a Pew study showing that broadband access to the Internet was at 47 percent in 2007, but “by the end of 2009, nearly 65 percent of all U.S. households subscribed to broadband.”
Because of the open competition, which has been the hallmark of broadband expansion, the authors write that the data “implies that most U.S. households have a choice of at least three broadband technologies and even more suppliers” in any given service area.
During the worst recession in modern economic history, while “nonresidential private investment declined by 18.1 percent” from 2008 to 2009, “broadband investment declined by only 3.3 percent” but was still $30 billion over that same period.
Crandall and Singer also make the point that there is a difference of opinion regarding from where future innovation will come. They say that the supposition that the most important source of innovation will be “at the edge of the network” is often assumed, but not supported empirically.
“There is a clear track record of job and wealth creation associated with investment in first-generation access technologies, suggesting that investment at the core of the network is equally if not more important.”
Thus, the increases in broadband’s reach, penetration, capabilities, and services which we have seen over the past seven years with a minimum of government interference should be embraced by the Federal Communications Commission (FCC) as it moves through the process of creating a National Broadband Policy.”
The complete study is available here.
Broadband for America (BfA) is a growing coalition of over 180 members ranging from independent consumer advocacy groups, to content and application providers, to the companies which build and maintain the Internet. The complete BfA membership list is available at: http://www.broadbandforamerica.com/about/members