Since broadband is a relatively new phenomenon, there has been a limited amount of empirical research that has attempted to measure its economic impact at both the national and local level.  The first studies undertaken were designed to provide a macroeconomic impact assessment of its impact on the national economy.

The first group of these studies were done on the U.S. economy and have figured prominently in the economic literature on broadband.  Crandall and Jackson (2001 and 2002) estimated that widespread deployment of broadband could result in a $500 billion annual increase in the U.S. GDP through the impact that it would have on changes to the consumption behaviour of consumers.[i]   Criterion Economics (2003) estimated that ubiquitous adoption of broadband could result in the creation of more than 1.2 million jobs in the United States.[ii]  The Yankee Group (2001) forecast that universally available broadband could result in cost savings to the U.S. economy of $233 billion over six years [iii] and Momentum (2003) estimated that adoption of Internet business solutions resulted in $155 billion in savings over the period 1998 – 2001.[iv]

A study on the economic impact of broadband on the United Kingdom yielded similar results.  In a study conducted by CEGR (2003) for the Broadband Industry Group, it estimated that the productivity benefits from broadband could be as much as 2.5% resulting in an annual increase to the UK GDP of £21.9 million and an increase in annual net exports of £11 billion by 2015.[v]

One of the first studies to assess the impact of broadband on a regional economy was done on the State of Victoria in Australia by ACIL Tasman (2004).  It concluded that broadband would have significant impacts on productivity, employment and investment. Over the period from 2004 – 2015, the annual increase in Gross State Product would be 0.82%, employment would increase by 0.5% annually and overall investment by about 10.5% for the period.[vi]

This research helped to establish the relationship between economic growth and broadband deployment at the national and regional level. It was not until 2003 that research was directed at individual communities.  There are three studies at the community level (i.e. Cedar Falls, South Dundas Township and Lake County, Florida) that have been considered as benchmark works and are the most referenced as justification for the establishment of local access networks.  Although none of these are true Local Open Access Networks, they still demonstrate that the establishment of these networks to provide high-speed Internet access did generate economic benefits to the community and region served.

The case studies and anecdotal evidence are designed to demonstrate the importance that local access networks can have to the economic development of communities and to provide a greater understanding of the reasons why communities were prepared to make the investment.  Many of the examples deal with local access networks that are not open to other suppliers either because of a conscious policy on the part of the local government or the inability to attract multiple suppliers because of the size of the community.  Although true Local Open Access Networks would provide greater economic efficiencies, as demonstrated in the work of the Allen Consulting Group (2003)[vii] for the Queensland Government in Australia, the experiences of these community networks do provide a great deal of insight towards their contribution to ensuring growth in smaller and more remote communities and regions.

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REFERENCES