Socio-Economic Benefits of High-Speed Broadband
Socio-Economic Benefits of High-Speed Broadband
November 6, 2007: Labor’s in power and the hotly anticipated national broadband network is the talk of the town, but what are the socio-economic benefits from this and even higher speed broadband infrastructure?
High-speed broadband infrastructure is an extremely expensive endeavour and has been known to cause constant troubles for communication ministers all over the globe. There is a strong belief though, that this kind of investment will lead to economic growth and opportunity and fulfill many social goals by providing high-speed broadband access.
“There is no doubt that broadband access brings significant socio-economic benefits. In today's world, ICT is normally a large driver of economic growth, and telecommunications is usually one of the largest of the ICT sectors. .” said Michael Philpott, principal analyst at Ovum.
During his lengthy election campaign, Prime Minister Kevin Rudd referred to the social and extensive economic benefits to be had from broadband investment, particularly as an area to look into if the resources boom were to decline. There is a slight difference in Australia’s case however, as the Fibre-To-The-Node (FTTN) network that was promised could be considered standard-speed when compared to Fibre-To-The-Home (FTTH) networks throughout the world, and the faster the network the easier it is to identify social and economic benefits.
According to Philpott, there are indirect social and economic benefits to high-speed broadband that would suggest it is in a government’s interest to remove such a divide.
“Increased competitiveness, greater attractiveness to foreign investment, greater use of e-services such as e-government, e-health, e-education and teleworking all bring economic and/or social benefits to a country. Such benefits can often only be maximised though through extensive broadband coverage and availability. However, there are still large sections of any country that cannot get or believe they do not want/need broadband access. Resolving this should be any government's prime objective.” said Philpott.
Despite this, Ovum believes that the Government should be cautious and that any such initiative should only be undertaken as part of a wider strategy. This stems from the belief that high-speed broadband alone will not automatically increase activities such as home-working.
“Direct benefits of high-speed broadband are harder to prove as, at least today, there is little additional revenue being driven from fibre customers. In certain countries, such as Korea, dependence on ICT is so strong for future economic growth that the picture is a little clearer. However, in most countries the real benefits to high-speed broadband will be indirect, and therefore more speculative.” said Philpott.
While it’s all well and good to start a song and dance about how wonderful it would be to have the best available network we can afford, such as FTTH, for it to be a feasible project there must be clear and tangible social and economic benefits for the project to get off the ground. Philpott believes many people claim that high-speed broadband will bring numerous benefits but we really don’t fully know what those benefits will be.
“Private industry is likely to invest in new high-speed infrastructure as part of the industry's natural development, but it currently faces the same uncertainties around what the real opportunities are, how big they will be and how fast they will appear. The big questions are therefore when such investment will take place and how extensive it will be.” said Philpott.
What is clear is that for any network to be successful, whether it be the FTTN network Labor has promised or a faster and far more expensive FTTH network, without much more extensive and transparent planning, coupled with the government and private enterprise uniting behind it, the success of the network is questionable.