In the last month or so I’ve blogged about people touting the need for a statewide or national broadband policy. Well, today I ran into an editorial from someone who thinks a “National Broadband Policy Would be Bad for Broadband.”
The author, Harold Furchtgott-Roth former FCC Commissioner, claims broadband does not require a national policy or any regulation to support increased deployment. He compares broadband to other consumer goods and says that the economics of broadband are similar – it relies on cost, availability and income. The US does not fare well in international broadband standing – but Furchtgott-Roth insists that there is no proven relation between broadband and economic development.
I completely disagree with Furchtgott. I’d be very interested in hearing other reasons against a national policy – because these don’t hold much traction with me. First – I think that broadband is more than a consumer good, it increases access to info, telemedine, e-learning and more. Info and application providers are starting to assume that people have access to broadband and so those without will not be able to access basic info or applications. For example, Moose Lake is a community that is creating a community web site where they plan to post public service announcements – including public safety messages. I think more communities will be moving towards such online services and only those with access will be able to take advantage of the resources.
On the second point I think that there are reports out there that make the broadband-economic connection. I have listed a few below:
OECD Backs Broadband for Economic and Social Development
The OECD called on governments to do more to encourage the development of broadband, emphasising its importance for economic, social and cultural development worldwide and warning about the risk of missed opportunities from failing to do so.
(Ann’s not: OK this isn’t a report but coming from the OECD was good enough for me.)
Measuring the Economic Impact of Broadband Deployment
The results support the view that broadband access does enhance economic growth and performance, and that the assumed economic impacts of broadband are real and measurable.
Broadband and Economic Development: A Municipal Case Study from Florida
“Our econometric model shows that Lake County has experienced approximately 100% greater growth in economic activity – a doubling – relative to comparable Florida counties since making its municipal broadband network generally available to businesses and municipal institutions in the county. Our findings are consistent with other analyses that postulate that broadband infrastructure can be a significant contributor to economic growth.”
Central Coast Broadband Access Project
The bottom line is that the networked economy is built upon broadband access. This means that those regions that over time do not develop the types of ubiquitous broadband connections that exist elsewhere will be at a significant competitive disadvantage.
It is important to understand that the Internet itself was not created by private investment. Its origns were fully funded and its construction was initiated by public bodies (government or educational dollars). More importantly, this public investment has returned value that any business would have been happy to capture, even though its purpose was not that. At the time, private companies were of the same mind as today – it’s not a profitable investment. Afterall, who was asking for an Internet then? They didn’t see it, the private sector I mean. They didn’t build it. The public did.
This is not to deny the endless arguments over the economic value, or rather, the economic versus investment value of communication networks. Investment value is just that – investment value – only a close cousin to economic value. Investment arguments stand on their own and there are excellent case studies both pro and con, both public and private. What sought investment returns are included are often the reasons for these endless arguments.
With public investment, what is sought is more often inclusive of public returns (taxes, employment, living standards, attractiveness) and those are appropriate for public actions. Those are usually less so for private investment. I mean to suggest that there are often needs to which citizens turn to collective action which are not measurable in strict revenue-cost, supply-demand and profitability terms. Economics is the study of human wants, not solely investment viability. These needs can be as causal as attempts to improve the quality of life in a given geography, a given collection of people.
As a collective action, a public action, we should be free to justify our wants without the measurement critieria of the private sector. If our actions also happen to meet profitable objectives so much the better. It did with the Internet. It will with those who find the value in public leadership for this very connected world.
Eric,
I really enjoyed reading your comment. In 1995, I worked for Minnesota Regional Network, a nonprofit ISP with strong connections to CICNet. (I couldn’t even find an old web site for that org – this is the best I could find: http://kb.iu.edu/data/acaq.html.)
I remember the day that the National Science Foundation gave over the backbone to Sprint, UUNet, and someone other national provider that I can’t recall. Back then I used to be the one to take the calls from people who would ask “what is this Internet thing anyways?” “should I get a computer, a fax, or an Internet?” And “my boss wants an Internet, do you have one in our area” I had the history of the Internet (DARPA Net) memorized.
What I really loved about the industry at the time was that very few people became ISPs for the money. They did it for the love of connectivity – especially in rural areas. As you point out, people created opportunity without the constraints of the measurable criteria of the private sector. And somehow it all worked out.
Even if the Internet had not turned out to be so explicitly profitable, I think of the information and applications that are now accessible due to the investment of the government. It was a great investment – and I think it merits a second round of funding! Thanks for your comment!
The discussion above reminds me of the debates around healthcare. The United States insists on treating that as a simple commodity and now 47 million Americans are uninsured, those who have it are paying more and more and it is a huge drain on our economy. Other countries have public policy on health care. The internet might not be life or death but it is more and more a necessity — government forms and information, education, medicine, rural development, political discussion. Those without access are really becoming second class citizens. There are ways to both make it profitable and make it universal, fast and affordable and our government must play a part in making sure that happens. Other countries of done it and some states are taking on the challenge. It can be done and it can be done right.
Laura,
I think your comparison to health care is perfect! (I went to the doctor yesterday for a broken toe. So I was really thinking about it.)
I think there are some great telemedicine applications that really make the case. Killer App ran an article a couple months ago about Mammograms that are available on reservations due to broadband. The Indian Health Service did 515 mammograms in North Dakota & South Dakota between March and July, 2006. With a mobile medi-bus (my term) they were able to take the mammograms, transmit them to University of Michigan and get a diagnosis in as little as 30 minutes. Women needing extra testing were able to get that immediately or the next day. (Learn more here: http://www.killerapp.com/content/publish/article_245.shtml)
Only 10 percent of Native American women over age 40 get a yearly mammogram. Distance is one reason. And traditionally a woman might travel 100+ miles for the test and not get the results for a week. If further testing is needed, she goes through the process again.
It’s easy to see the potential for huge savings in time, money and lives with this program. It saves time and money for the women who get tested. It helps catch cancer earlier, which saves money for the health care system (that’s all of us as you point out). And most importantly there is the potential to save lives! And that’s the start of the ripple effect. The lives saved have a huge impact on the lives of others.