Craig Settles’ Broadband Question of the Day (July 29)

This question comes from Cathy Emerson, Project Manager,  Center for Econ Dev, California State University, Chico

How can we quantify the economic development benefits of broadband?

To answer this question, you have to separate the discussion about broadband’s impact into two parts: the public good and the financial benefits to the broadband project.

When most people talk about the main benefits of broadband that affect the local economy, they point to a number of significant impacts such as increasing local businesses’ ability to expand and compete effectively on a global basis, or drawing more companies to an area. Officials will add far-reaching affects such as using broadband to improve students’ learning and re-training workers for a digital economy.

While these are all good things, they are illusive goals for quantitative analysis. People all over the US have anecdotal stories that show clear ties between broadband and activities that improve the local economy. But these are factors contributing to the public good, and you can build a strong case for investing in networks based on them. However, if you also want to build a  “dollars & cents” case that shows how this public good will help financially sustain the network, turn the question around.

Which businesses in our community will pay for broadband services that help them expand and compete more effectively? What broadband services and applications does your needs assessment indicate businesses require to compete in a global economy, and how much will they pay for regular services, or for premium services?

You have to ask, how many people in the community are interested in starting home businesses and will subscribe to the network? What colleges will contribute infrastructure to the project, thus reducing some of your buildout costs, or buy network services to facilitate online courses and job training programs?

When you’re writing your broadband business plan, be clear about which goal – public good or financial ROI – each of your points addresses when you use economic development to justify the investment in your network.  And of course, some of the same points can address both goals.


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