Friday, January 21, 2022

What if "Better Broadband" Actually does not "Cause" Economic Growth?

The prevailing wisdom that super-high-quality home broadband actually changes things is wildly and uncritically accepted as “truth.” That is not to deny that ubiquitous access to higher-quality broadband is to be preferred. Homes who can only get 25 Mbps will not have the same experience as households able to use 100 Mbps to 200 Mbps, when there are multiple users and multiple devices in simultaneous use. 


The issue there is bandwidth per user and device, in real time, with simultaneous use of various applications. Multiple users almost always benefit from “more bandwidth,” as is the case for every shared communications medium. 


But as a matter of science, it is impossible to actually quantify the outcomes from upgrading access--ubiquitously--from some lower level to some higher level. 


For most households, businesses and communities, almost nothing would change simply because bandwidth was increased from a moderate level (100 Mbps to 200 Mbps) to a gigabit per second, for example. 


More precisely, for any single user, trying to use any mix of applications, more bandwidth might help with experience, or might not. In other words, the benefit of “more bandwidth” depends on how many users in a home, how many online simultaneously, what they are trying to do, how many devices they are using and what the applications “need” in terms of performance. 


Downstream is one thing; upstream another thing. 


And, to be sure, our requirements drift upwards over time. That will not stop. But outcomes hinge on many things other than per-user bandwidth. We cannot actually say that student performance on homework is X percent better with Y increase in per-user bandwidth. Maybe it is; maybe it isn’t. 


And it is hard to see a true causal relationship between region economic growth and job growth, for example, as bandwidth is increased from X to Y. Regions that are growing slowly will still grow slowly, even with better broadband, because growth hinges on other matters, such as proximity to large markets. 


Regions losing population; facing industrial shutdowns or other changes in underlying conditions do not materially change simply because “better broadband” is available. 


Tourism, manufacturing or service businesses do not often relocate to distant or isolated regions because better broadband is available. There are other important reasons why a place is deemed fruitful for additional job growth or facilities. 


Better broadband does not causally change educational or industrial or professional skills possessed by the local population. You might argue that permanent work from home will change living locations. 


But most of those changes will still be tethered to population centers in key ways, simply because humans value the amenities that population density provides. So exurban changes will happen more than shifts of sizable numbers to very-remote areas. Shifts from urban to suburban likewise will be materially more important than shifts to very-rural areas. 


Yes, anecdotally, more people will spend more time in mobile modes when working away from the office. But the actual level of home broadband access quality--beyond a baseline level-- will arguably be a secondary consideration, at best, in most cases. 


Places that can be upgraded from less than 25 Mbps up to 100 Mbps are likely to be places not so desirable for workers for other reasons. Upgrades from 100 Mbps to some higher number likewise might be helpful and preferred, but not a driver of detectable performance and outcomes. 


One might argue that personal productivity now is higher with gigabit access than with dial-up. But that is a correlation. The applications I could use in the dial-up era were the real limitation, not the bandwidth. 


Today’s applications are so much richer that I cannot separate bandwidth from application richness. To the extent I might claim to be more productive, it is mostly because my applications and devices allow me to do more, in less time, not that my bandwidth--per se--allows me to do so. 


Better bandwidth is--virtually all of us agree-a good thing. But its ability to change outcomes--economic; job creation; educational outcomes--generally is overstated and hard to prove. Parental support for and involvement in their children’s education counts for much more. 


The general economic growth profile of a region matters more than the speed of broadband. The presence of large pools of workers with the right skills matters more than broadband. The quality of life of a region for such workers also arguably matters more than broadband.


In fact, we cannot disprove the thesis that highly-educated residents; fast-growing regions and industries; high incomes and high wealth “cause” better broadband, not the reverse. 


No comments:

Directv-Dish Merger Fails

Directv’’s termination of its deal to merge with EchoStar, apparently because EchoStar bondholders did not approve, means EchoStar continue...