March 05, 2009, 3:11 PM — The U.S. government should be doing more to encourage broadband deployments with speeds of at least 50Mbps (megabits per second) in order to encourage a new generation of innovative and job-creating companies, a new report says.
U.S. policymakers need to look beyond the US$7.2 billion in broadband money in a recently passed $787 billion economic stimulus package and set goals of next-generation broadband service for the entire country, says the report, released Thursday by the Information Technology and Innovation Foundation (ITIF), a tech-focused think tank.
Without faster broadband available across the U.S., the next generation of innovative tech companies in the mold of Google or Hulu will sprout outside the U.S., said Jeffrey Campbell, senior director of technology and trade policy at Cisco Systems.
"If this country is going to maintain its position as one of the top economies of the world, we have to be competitive in the fields that relate to broadband," he said at a forum focused on the new report. "We lead them today, but there's no reason that we'll naturally lead them forever."
Broadband was rolled out first in the U.S., and that attracted the top Internet entrepreneurs, Campbell added. "Today, we face a situation where other countries have better and faster networks than we do," he said. "If we don't do something about that in the long run, the third generation of [Internet applications] are not going to be developed here in the United States."
Average broadband speeds to U.S. residents are about 5Mbps, compared to 63Mbps in Japan and 49Mbps in South Korea, noted Stephen Ezell, co-author of the report and lead analyst at ITIF. Current U.S. speeds aren't sufficient to enable a new generation of Internet applications, such as telemedicine and real-time work collaboration, he said.
There are some misconceptions that broadband subscribers will use faster speeds primarily to watch YouTube or other online video, said report co-author Robert Atkinson, ITIF's president. While video entertainment will be among the uses, the report details several other possibilities, including distance education, remote health care diagnosis, better video conferencing and better telecommuting experiences.
If all U.S. residents get fiber-speed broadband to their homes, the nation would have a 5 percent reduction in gasoline use, a 4 percent reduction in carbon emissions, a $5 billion cut in highway expenses and 1.5 billion commuting hours saved, the report says, quoting a Render Vanderslice and Associates study.
No broadband providers spoke at the event, but providers such as Verizon and Comcast argue that they're already rolling out high-speed broadband. Verizon's Fios fiber-based service offers 50Mbps to subscribers in several states, and Comcast is rolling out a new networking technology called DOCSIS 3, which offers download speeds up to about 50Mbps.
Link Hoewing, assistant vice president for Internet and technology issues at Verizon, pointed out that the ITIF paper calls for limited government regulation in areas where the private market is working well. Hoewing, writing on Verizon's policy blog, also agreed with ITIF's call for tax credits to broadband companies in addition to the grants in the economic stimulus package.
"At a time when broadband deployment, investment in broadband technologies, and policies that encourage use of broadband technologies to help solve such social challenges as health care, energy conservation, and education [are called for], the issue of how the broadband community advances capacity and capabilities of these networks is a critical issue, if not the critical issue we must address," Hoewing wrote.
Asked whether the money for broadband in the stimulus package should go toward next-generation speeds, ITIF's Atkinson said there's not enough money to provide broadband to areas that don't yet have it and to roll out next-generation networks. The stimulus money should focus on unserved areas, but the U.S. should next adopt a broadband policy that aims for 50Mbps or higher speeds across 90 percent of the U.S., he said.
Others at the forum disagreed, saying the broadband stimulus money shouldn't aim to deploy broadband networks that will need to be upgraded again in a couple of years. The stimulus package spending on broadband will mean that U.S. broadband numbers are no longer "an embarrassment" compared to most other developed nations, said John Windhausen, president of Telepoly, a telecom consulting firm. But U.S. policy needs to aim for 100Mbps broadband and beyond, he said. "We're still woefully deficient," he added.