Measuring the economic benefits of broadband: a few studies
I receive emails from time to time asking if I know of studies that show the economic benefits of broadband. I know I’ve read some of them but I can never remember any one in particular. Today I came across a site that lists a few studies done in Europe, Asia and the US. For example, there is a study that investigates the effect of high-speed broadband on Korea’s economy and one on broadband in North Carolina. To see the list of studies, click here. Craig Settles, a frequent contributor to Muniwireless.com, came out with a survey in December 2008 called The Economic Development Impact of Municipal Broadband.
While high-speed broadband is critical to economic development, it’s not by itself going to propel anyone to the heights of Mount Olympus. A region is not suddenly going to churn out math geniuses, Nobel Laureates in literature AND quadruple its GDP. There are other things that need to happen including long-term, significant public investment in education*, health care (especially women’s health); and commitment to open, transparent government.
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*Education: by this I don’t mean what we have today — our universities and schools (public and private) — which are nothing more than “factories of credentials”. There is very little real education that takes place there. Elementary and high schools care primarily about how they rank the statewide test scores. Their sole interest is to train their students how to do well on these tests. Universities pack as many students in their lecture halls, make them take tests so they can regurgitate what they remember from the lectures. The universities put labels on the students (called Grades), then spew them out into the world with “credentials” in the form of diplomas with further gradations of quality (think of how meat is labeled). Universities pander to alumni for even more money to support sports teams, the swimming pools and sports facilities, etc. Many universities including public ones like UC Berkeley, look more like day spas. They need to create the illusion of well-being via the physical facilities. Learning, or better, having that “aha’ moment, is rare and is usually organized by the student herself, which makes you wonder why people should go to university at all.
Here is where broadband can make a huge difference: cutting out the expensive middleman called the university, which now in the US charges $20,000 or more per year for a rather paltry product. Not every area of study can be done online or virtually. You still need physical laboratories for physics, chemistry, biology so one will have to reorganize on the physical level as well . But you can see where truly high-speed access which allows for virtual classrooms and interactions can strip even further the pretensions of existing educational institutions.
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The most shocking study I have ever seen in the economy of broadband wireless was done 5 years ago in a presentation by the Intelligent Transportation Society of America. Simple things like the ability of using wireless infrared sensors to count cars for signals changing rather than waiting at timed lights saved billions in fuel costs will reducing the need for additional road construction by 20-30%. Wireless collision avoidance detection in major intersections was also shown to save billions in heath care and long term disability cost.
In additional studies, the use of wireless broadband surveillance cameras immediately dropped crime by 30 to 40% (ask Andy, the CIO in Chicago). City code inspectors more than quadrupled their inspections by using wireless broadband access for pictures, videos and reports rather than going back and forth to the office. Property management companies are beginning to use local wireless broadband intranets to monitor their properties and service work force in a time they need to run much more efficiently.
We just need to think outside with wireless broadband not just inside. The applications of outside wireless broadband are just now beginning to be developed. I was once told by a Business Development Director from Stanford Research International that the potential of the local wireless broadband in day to day applications will far exceed the use of today’s Internet. The economics of wireless broadband is just starting.