2010 Buyers Guide - Broadband Properties

Country
Stimulus
Investment
(USD Million)
Jobs Expected
From Stimulus Investment in Telecom Networks
Network Deployment Jobs Estimate
Direct Jobs Indirect Jobs Induced Jobs Total (Direct +
Indirect) /
Direct
Multipliers
(Direct + Indirect
+ Induced) /
Direct
$6,390 37,000 31,000 60000 128,000 1.83 3.42
Switzerland ~$10,000 ~80,000 ~30,000 NA ~110,000 1.38 NA
Germany $47,660 281,000 126,000 135,000 542,000 1.45 1.94
United Kingdom $7,468 76,500 134500 211,000 NA 2.76
Australia $31,340 NA NA NA ~200,000 NA NA
Source: Raul Katz, CITI
Haskayne School of Business in Calgary,
said. “Maybe it helps B-to-C
commerce,” he added. He used firstdifferences
regression to try to tease
out causation from his 15-country
data set, and didn’t see much effect.
• Heather Hudson, professor of telecommunication
at the University of
San Francisco, looked at telecom’s
role in rural and less-developed
countries’ development. She showed
a fiber trench being dug in Tanzania,
where 37 of the 130 administrative
centers are now connected by fiber,
thanks to a Chinese-funded project.
“But what is the quality of service?”
she asked. “And what is the sustainability
after the one-time funding
goes away?”
• Wireless is an important component
of any national bandwidth enhancement
plan, but alone it cannot handle
the bandwidth, reliability and
security that business demands. In
the United States, AT&T Wireless
has had trouble keeping up with the
50-fold growth in wireless data traffic
brought about by the iPhone. The
inadequacy of the spectrum assigned
to mobile communications also imposes
physical limits on bandwidth
growth.
• Wireless can be a useful wedge to entice
those on the far side of the digital
divide to make their first leaps
onto the Internet.
What is not hard to predict is bandwidth
demand. Said Robert Pepper, vice
president for global technology policy
at Cisco, “By 2014, just 50 U.K. homes
will generate as much traffic as the entire
U.S. Internet backbone in 1995.”
Hurdles for
Broadband Policy
CITI founder Eli Noam noted that as
part of its economic stimulus program,
“Australia wants to create a state [network
company] and then privatize it,”
at a total cost of $23 billion, or about
$5,000 per home. But, Noam asked,
“How does the monopoly set its wholesale
prices, stay technologically advanced
and privatize while keeping prices low?
This is a very ambitious plan with no
clear end points.”
Korea, Noam noted, has a stated goal
of 100 Mbps per household, but dominant
telco KT “is guaranteeing only 1
Mbps and [providing] … closer to 2–3
Mbps.” The Korean government wants
a 30 Mbps guarantee, but to do that
requires a peak capacity of 1 Gbps, he
said. “So when you hear 1 Gbps there,
it is not real.”
Japan has the highest broadband
penetration and lowest economic
growth among OECD nations. Korea
also has low productivity growth and
high broadband penetration, one questioner
noted. But what if Japan and Korea
didn’t have broadband? Would their
economic growth have been even lower?
Said one Japanese scholar, “Japan is an
information society but [the Japanese]
do not have a [historical] context to
make software. Now Japan is exporting
$5 billion worth of software a year; expect
it to be $20 billion in 2020.”
Confusion was not limited to other
nations. “In this administration, there
are so many czars it is like a Romanov
family picnic,” Noam quipped. Scott
Broadband Impact as a Percentage of GDP
In Europe, 2006-2007
Source: MICUS
Advanced-knowledge sociees
EU 27
Large industrial economies
Quickly developing economies
Less developed broadband
0.47%
0.63%
0.71%
0.70%
0.89%
0.00% 0.10% 0.20% 0.30% 0.40% 0.50% 0.60% 0.70% 0.80% 0.90% 1.00%
The impact of broadband is greatest in the most advanced countries; 70 percent of net job creation
related to broadband is due directly to innovation.
November/December 2009 | www.broadbandproperties.com | BROADBAND PROPERTIES | 55