If one measures the value of broadband not by simply "organizations that can buy broadband" (availability) or "homes buying broadband," (demand), but rather as a the ability a nation has to harness broadband to drive economic growth, the United States ranks first in the world, says Leonard Waverman, Fellow of the London Business School and Dean and Professor at the Haskayne School of Business at the University of Calgary.
The United States has seen more clear-cut productivity gains than has Europe, and a major source of this U.S. productivity advantage is broadband usage by businesses that are not themselves producers and providers of broadband services, Waverman says.
The concept of “useful connectivity” is based on the notion that the economic value generated by connectivity depends not just on conventional measures such as broadband lines or computers
connected, but also on who is using those lines—businesses or consumers—and how
well they are able to use the lines, says Waverman.
"The notion of connectivity should be expanded to include also the complementary assets (software) and skills — embodied in people, governments and businesses — that determine just how productively the hardware and infrastructure are used.
"We use the term 'connectivity' to refer to the totality of interaction between a nation’s telecommunications infrastructure, hardware, software, networks, and users
of these networks, hardware and software," he notes.
Thus broadband lines, PCs, advanced corporate data networks and advanced use of wireless data services are certainly measures of connectivity, but so are human skills relevant to the usage of these
infrastructures, technologies and networks.
Consider the case of Korea, which has a very advanced fiber to the home capability. However, Korea is also a very heavily business-driven economy in that the levels of business investment and intermediate consumption are very high compared to the level of consumption by the consumer sector.
On measures such as business spending on enterprise telephony and data services, Korea’s performance might be termed “lackluster,” Waverman says. By way of contrast, U.S. businesses are leaders in use of IP telephony and other broadband-based technologies, as well as the more subjective ability to use technologies as sources of business advantage, and drive innovation.
As with all such cross-nation "rankings," there is some element of subjectivity. Still, the point is well taken: broadband economic benefits cannot be measured by simple reliance on penetration or availability data. Human, cultural and institutional capital play a big role.
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