Broadband Expansion Economic Impact

David Byrd : Byrd's Eye View
David Byrd
Chief Marketing Officer for ANPI

Broadband Expansion Economic Impact

The initial focus of this series explained that most of the allocated telecom stimulus money has not been awarded and only a small fraction of it spent. The next consideration is what will the impact be on our IP community? This is a major concern as we work to address job losses by some our major OEMs, network providers and carriers. Additionally, both the expansion of broadband and improvements in speed will result in general economic activity for the businesses that benefit from the infrastructure growth. The $7.2 billion allocated as part of the Stimulus Bill is not intended to fund all of the construction projects envisioned. Rather it is to fund some of the less profitable projects to improve access in rural and underserved areas. While the Jobs for America study emphasizes this point, its analysis covers all forecasted broadband improvement for the next three years.

The job creation resulting from a program to expand broadband speeds nationally is impressive. The Milken Institute study concludes that a $55 billion investment in construction and telecommunications services will result in 293,000 construction and telecom related jobs. The ripple effect again follows a common ratio of 3:1 or slightly more than 1 million jobs and $44 billion in earnings. Although, the country has lost between 7-8 million jobs since the recession began, the potential addition of 1 million jobs because of activity in a single vertical is very much appreciated.

I only took issue with one comment in the study. Too often, we think of the Internet as providing the primary tool to allow businesses to compete globally. Broadvox's business is to provide SIP/VoIP communications and Internet access.  SMBs want that capability and access to compete in their local communities first, nationally second and globally third. When I need an electrician or plumber, I begin with the Internet to identify qualified local trades people. Broadband expansion also results in lower sales acquisition costs and improved productivity. Businesses then have additional capital for investments and employment. SMBs provide the majority of jobs in their local communities and most are focused on serving that local community. Having worked for several Fortune 500 companies, I understand the need to think globally. However, the true contribution of SMBs should not be understated or under appreciated.

However, I digress. It is important for the IP community to understand and promote the continued expansion of broadband for job creation and as an accelerant for economic activity.



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