March 2011 Bandwidth – Avoid Being a “No Place,” Measuring Value, and ATUG
Don’t Let Your Region be a “No Place”
by Doug Adams
Without compelling reasons, applications, and e-solutions for your constituents to utilize your broadband network – the hopes you have for its transformational power are sure to come up short.
Just recently in the United Kingdom, the community of Cornwall showed that utilization of broadband services is not achieved simply by the rollout of a broadband infrastructure. It has to be accompanied with awareness initiatives and e-solutions that drive utilization. By providing companies with concrete solutions and advice, companies were made aware of the benefits of broadband and quickly utilized the network.
Debunking the Fable of “Build it and They Will Come.”
This is the story of one political leader whose vision exceeded even the wildest expectations of his constituents. It’s the story that illustrates the difference between idealism and realism, the difference between a “pipe dream” and reachable goals. What separates the ineffective dreamer and the transformational leader? A strategy that goes beyond initial investment.
No matter left, right, or center… political initiatives often start and end with the initial investment. Regulations can often drive adoption of the investment – and often market forces drive utilization. But what happens when utilization needs a push? Even the staunchest laissez faire politician would have to admit that… sometimes… initial investment is just not enough.
Back to our story and mayor of a mid-sized city famous for being the largest “land locked” city in its country and an unflattering nickname of “no place” that reflected a lack of almost anything distinguishable.
This mayor had a vision – a vision that his city would become a destination for businesses, tourists, and events. But without an infrastructure… how could he pull this off? Getting approval for an investment in a 60,000 seat domed stadium – to the outsider – may have seemed like his greatest hurdle.
None of this happened in a vacuum. Beyond the initial stadium investment, the mayor and his staff needed to aggressively bring events, teams, hotel chains, etc. to the City. They had to be creative in leading the development of downtown to transform a “no place” to a prosperous “some place.” And the mayor of this town retired after 16 years in office, the most beloved leader the City has ever – or dare I say it – will ever have.
Now since the transformation of this City, many have followed suit… but only partially. Stadiums have gone up across North America to attract professional sports teams – some successfully attracting teams. But that is where it has stopped. You see, investment without an all-encompassing strategy can work… but only to a point.
So – as community leaders investing in broadband initiatives today – can we really learn anything from a stadium build and accompanying transformation? We better.
Without reasons, applications, and e-solutions for our new broadband network – all we have is an empty stadium. It may attract some patrons – but it will never realize its transformational power. Turn to SNG – we can help you develop your own legacy of making your region a “some place.”
SNG has been helping communities and its leaders for more than 15 years ensure that broadband investments receive their maximum economic impact. By uncovering gaps, mapping demand, and helping communities develop innovative e-solutions and driving awareness and utilization, SNG helps make sure your network investment has transformational (and measurable) impacts.
Uncovering the Value of Rural Broadband
by Derek Murphy, VP, Product Delivery
One of the ongoing challenges for any region is to understand the actual benefits and impacts of public investments in broadband policy and implementation. Understanding and demonstrating impacts is critical as you face mixed and conflicting expectations and scepticism among both the general public and decision makers. One of the most important areas for assessing impacts is in rural areas where the vast majority of “unserved” and “underserved” are located.
I recently came across a research paper published early last year by the Public Policy Institute of California (PPIC), titled “Does Broadband Boost Local Economic Development?” It underscores some of the major problems in understanding the rationale and evidence for investing in rural broadband.
While there is a lack of substantive research on the impacts of rural broadband, PPIC takes an important effort at understand the issue, and is a welcome (hopefully) first step in a concerted effort to understand and enhance the impacts of public investments in rural broadband. Nonetheless, the PPIC paper contains flawed analysis and conclusions. The PPIC’s conclusions understate the impacts of rural broadband investment, undervaluing the potential for leveraging rural broadband for local economic development.
Rural broadband impacts need to be assessed initially at the conceptual and policy level, requiring a framework to understand the range of possible and desired impacts broadband can deliver. The PPIC illustrates just what happens without a strong policy framework. The paper states its objective, “to assess whether policies to raise broadband availability will contribute, as hoped, to local economic development.” The misstep here is that “local economic development” is only defined as “economic growth” in jobs and income. This confusion of economic development with economic growth is a fundamental and frequent mistake in which a historical bias towards never-ending “growth” replaces a more thoughtful understanding of economic development as a sustainable economy that provides income security, a diversity of opportunities to local residents, and a source of external income for the region.
The problem of mixing the two distinct concepts and objectives of growth and development is exacerbated by the lack of analysis of economic challenges faced by most rural areas in North America. There is ample evidence of the long term decline (relative or absolute) of rural areas as these areas lose population due to deaths and outward migration. The policy issue is whether these rural areas can replace all or most of the population that they are losing as they struggle to attract “replacement population.”
The objectives of local economic development vary greatly by the specific circumstances of each rural area. Economic development will often mean something other than “growth.” Economic development can mean a healthy and stable economy that reflects the changing nature of the national and international economy. A core economic development strategy for rural areas is development of strong amenities and services. Consequently, the role of broadband and related services is recognized by the USDA as a key strategy for rural economic development.
SNG’s research shows that broadband strongly influences locational decisions by both businesses and households about whether to stay or where to move. Our research also shows that consumers consider the speed and reliability of their broadband in making these decisions.
The USDA tells us that rural communities need to develop their own distinct strategies based on the costs and benefits that they specifically can expect. High-level analysis of aggregate data is useful in suggesting issues that need to be explored, but it is inappropriate for assessing the possible or likely impacts of improved broadband.
A more constructive approach is to look at communities in similar circumstances and determine the comparative results of their decisions to invest or not invest in enhanced Internet connectivity and competence. This approach is more likely to identify the consequences of not investing in broadband.
Aggregate analysis also doesn’t identify impacts at the level of specific companies, households, or communities. Understanding impacts at the granular level is important in understanding what opportunities realistically exist and what are the barriers to becoming competitive and productive. As demonstrated by SNG’s ground breaking work in North Carolina, obtaining granular data allows data to be turned into actionable intelligence for specific communities and companies. Instead of research drawing questionable conclusions that disempowers people, companies and communities, data gathered at the local level allows for a self-assessment that leads to decisions and actions that are appropriate and realistic.
Another factor for rural broadband not measured recently (in the past 5 years) by the PPIC study was the potential increase in telecommuting or telework as a result of increased broadband availability. SNG’s research shows a strong and positive relationship between broadband availability and teleworking and home-based businesses. Our findings are based on direct surveys in 2010 to over 9,000 rural establishments and 2,350 rural households.
Policy analysts, decision-makers and economic development practitioners need to engage in a meaningful dialogue on the expectations and impacts of broadband investments in rural areas. While investing in broadband in the 1990’s and early 2000s may have been a bold investment in growth, increasingly broadband is becoming a necessary defensive investment, not necessarily an investment in growth. Reliable and competitive broadband allows citizens, businesses and communities the opportunity to remain “competitive” and viable. If leaders and planners can’t get beyond seeing broadband as a “growth strategy,” then broadband in rural areas will more often than not be seen as a failure.
Nonmetropolitan Outmigration Counties: Some Are Poor, Many Are Prosperous – David McGranahan, John Cromartie, and Timothy Wojan, USDA Economic Research Service, 2010. http://www.ers.usda.gov/Publications/ERR107/ERR107.pdf
USDA Briefing Room – http://www.ers.usda.gov/Briefing/RuralDevelopment/RuralDevelopment.htm
Does Broadband Boost Local Economic Development?, Jed Kolko, PPIC January 2010, http://www.ppic.org/content/pubs/report/R_110JKR.pdf
Getting Down to Business Down Under
by Michael Curri
After a 22 hour flight, I landed in Australia a few days ago to attend the Australian Telecommunications Users Group in Sydney. It has been an eventful few days as I appeared on the Australian Broadcasting Corporation regarding broadband’s importance to Australia and what it could mean to national productivity and competitiveness and met with Minister of Broadband, Communications and the Digital Economy, Stephen Conroy and spoke with the opposition party Member of Parliament Paul Fletcher who is focused on the National Broadband Network (NBN). Both believe in the NBN and want to better understand what the benefits will mean to Australian businesses, organizations, and households. Let me digress here for a second… how great is it that Australia has a “Minister of Broadband, Communications and the Digital Economy?”
We’re at the very beginning of great potential through broadband for Australia. I was asked to run a workshop for community leaders involved with the NBN. Some highlights from this half day session included important questions and insights:
- It is important to have local examples of e-solutions and what they mean for local businesses and organizations.
- Even though the NBN is being built, it will still take 8 + years to have 93% connected. What can we do to bridge the gap between today and then?
- Jane Patterson talked about e-NC and its impact on North Carolina, as well as what broadband has done for rural businesses as they “compete globally, but live locally.”
- There is a culture of use that needs to develop (e.g acceptance of tele-working).
A final observation before I get back to the conference… In general, broadband is seen as significant and valuable, but questions remain regarding how much should be spent in building the NBN and what is the optimal model. While this is an important question, it is important to focus on quantifying the benefits from the investment. If we can keep politics out of this and focus on what everyone believes – that broadband does create economic advancement – then this unprecedented initiative should have long and far-reaching impact in Australia.
Look for next month’s Bandwidth for a more thorough recap of the event.
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Archives by Date
- Press release – Joint White Paper on Options to Bridge Broadband Gaps in Unserved and Underserved Areas
- Broadband funding is coming – but when and with what conditions? Can we wait for it?
- It’s Time for Private investment in Community Digital Infrastructure
- Unserved, underserved, or future ready – do your businesses and households have the broadband they need?
- Choice for Localities – wait for broadband, or invest in your digital future
- Do you need a “survey” or another “study” for your broadband initiative?
- Where do we put our efforts to get connected with broadband?
- Broadband and Household Income
- Telework and Accessing the Workplace
- SNG’s analysis featured in ISE Magazine
Over the last five years, job creation enabled by the Internet has doubled.