Tuesday, August 11, 2020

6% of U.S. Land Mass is Where Most of the People Are

One oft-ignored facet of communication network economics is that the business model is helped when population density is high, and generally suffers when population density is low. Also, it is far easier to build a whole new network in a small area, compared to a continental land mass. 

About six percent of the U.S. land mass is “developed” and relatively highly populated. About 94 percent is unsettled or lightly populated, including mountains, rangeland, cropland and forests. 

source: USDA

Pastures are located largely east of the hundredth meridian. 

source: USDA

Croplands, at least at the moment, stretch a bit further west. 

source: USDA

Rangelands mostly are found in the West.

source: USDA

But even the higher-population areas east of the Mississippi River contain huge tracts of forest land. 

source: USDA

All those facts have implications for networks. Most of the population or potential users can be covered by a smaller amount of network infrastructure, at first. But network coverage is another matter, as 94 percent of the land surface is lightly populated, consisting of forests, mountains or range land. 

In just about any instance, in any market, though, 80 percent of the revenue might be generated by 20 percent of the accounts, locations or use cases. Ericsson studies show that just 30 percent of cell sites support 75 percent of all traffic on the network. 

So it should come as no surprise that the cost of rural infrastructure can be an order of magnitude higher than for denser urban infrastructure.

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