'NBN' deployment in the US could create one million jobs & $US236b GDP

Stuart Corner
Thursday, 04 March 2010 16:54

IT Industry - Strategy

Deployment of a widespread broadband network similar to Australia's in the USA would result in an annual increase of 290,000 jobs and $US236b in additional GDP over the five year deployment period, according to a new study commissioned by the Fiber-to-the-Home (FTTH) Council North America.

The study is based on implementation of the FTTH Council's proposal that by 2015 there be universal access to current generation broadband capability at 3Mbps downstream and 768Kbps upstream and that 80 percent of homes have access to competitive next generation broadband capability at 50Mbps downstream and 20Mbps upstream during peak periods.

The study was prepared for the Council by the international consulting firm Navigant Economics. It concluded that achieving both these objectives would require $US77 billion in additional capital expenditure.

The FTTH Council has released the study the eve of the release of the Federal Communications Commission's National Broadband Plan. The benefits estimated come both as a direct result of the investment - ie jobs and economic activity associated with the network rollout - and indirect benefits resulting from the more widespread availability of faster broadband services.

The direct effects are likely to be proportionately greater in the US than in Australia, which is much closer to full employment. The report notes that the incremental capital expenditures that are required to meet the goal of ubiquitous current-generation broadband availability would have "a direct, multiplicative effect on output and job creation when the economy is at less than full employment, as it is today."

For indirect effect the study makes a number of assumptions and concludes that the indirect effects of meeting the proposed National Broadband Plan next-generation objective would be to increase the number of US broadband subscribers by 7.3 million, increase the US broadband penetration rate (defined as broadband subscriber lines per person) by 2.3 percent, and increase employment by a total of 660,000 jobs by 2015."