Big Bandwidth: Unlocking a New Competitive Advantage
Answer: They all need much bigger bandwidth than they have today.
These opportunities reflect larger economic trends. One is the primacy of knowledge exchange. In the 21st Century information economy, the productivity of every sector depends on its efficacy in collecting, analyzing, and disseminating information. Another is the transformational exchange of inputs. A century ago, America established world economic leadership by exchanging iron, coal and trains with steel, electricity, cars and planes. Future leadership now depends on our dexterity in exchanging inputs based on atoms with inputs based on microprocessors, fiber optics and digitization.
These trends come together over broadband, the commons of knowledge exchange. America thrived in the last century by exploiting a new and abundant industrial infrastructure (railroads, highways, etc.) that enabled us to lead in productivity and innovation. The foundation for leadership in broadband, however, requires two fundamental building blocks: A strategic bandwidth advantage and a “psychology of bandwidth abundance.” This psychology is what has fueled the uniquely American spirit of experimentation and innovation — from the first wave of European immigrants to the post-World War II America that helped rebuild Europe and Asia and created our modern economy and unleashed huge new industries from transportation to telecommunications.
Unfortunately, however, the current environment suggests that we aren’t building that foundation. International studies on wireline bandwidth use differ, but all suggest we are mid-tier at best, and declining. No American communities are hubs of the kind of world-leading bandwidth sufficient to birth big-bandwidth businesses. Instead, those communities now exist in other countries.
For the first time since American ingenuity birthed the commercial Internet, we do not have a single national wireline provider with plans to deploy a better network. For most Americans, five years from now, the best network available to them will be the same network they have today. As a result, the best networks — along with the innovations they enable — will live in other countries as well.
While we are enjoying a wireless upgrade, only a wired connection can provide the bandwidth necessary for “Big Bandwidth” services. When it comes to wireline access to the Internet, instead of discussing upgrades, we are discussing bandwidth caps, tiers and rising prices. Instead of witnessing investment for growth, we are witnessing harvesting for dividends.
I would be quick to note the Government is least competent when it micromanages pricing a service. But when it comes to broadband-fueled growth, it is as certain as tomorrow’s sunrise that a country talking about upgrades, not caps, will be better off in a few years; a country talking about caps, not upgrades, will not.
This outcome is not inevitable. We can regain leadership by improving the math for wireline investment through policy choices that have the effect of lowering capital or operating expenses or by raising the potential revenues or competitive threat to incumbents or new entrants. We have done this before. In fact, every new communications network deployment or upgrade has been preceded by a policy change that had one or more of these impacts.
Stimulating an upgrade does not require massive new government funding or regulation. In the summer of 2011, armed with nothing beyond understanding that math, we launched Gig.U, The University Community Next Generation Innovation Project. In less than a year, our coalition of three dozen leading research universities and their communities, through a productive dialogue with industry, has catalyzed over $200 million for private efforts to build gigabit hubs in nearly a dozen communities across the country, as well as a project to bring a 25X+ upgrade to hundreds of communities in rural America. This university-community effort has stimulated new approaches and business models for big bandwidth. For example, just this week, the Seattle City Council voted to challenge the private sector to use the City’s fiber network to provide Big Bandwidth to its community. This effort, the first of its kind by a municipality, is a clear example of the role Government can and ought to play in this equation: By lowering the barriers for the free flow of commerce, the Seattle City Council is creating the kind of environment conducive for the next generation of “Big Broadband.” And it is likely that Google’s launch this week of its fiber project in Kansas City — “100 times the speed/100 times the possibilities” — the first large-scale commercial effort to provide “Big Broadband” to American communities, will increase the interest of communities in partnering with private industry to create world-leading networks to drive economic growth.
While Seattle’s gigabit efforts depended on local government changes, and the rural effort depends on continuing to allow utilization of otherwise fallow spectrum, neither depends on new public funds or regulation of competitors. What is required in order to change is an urgent sense of mission, that the imperative of this moment is to make sure our country not only has a strategic bandwidth advantage but a psychology of bandwidth abundance. Indeed, we witnessed this just 15 years ago when policy changes enabled wireless companies to move from big per-minute charges to big buckets of minutes. Mobile use quickly soared fivefold, and we discovered new ways to use mobility to improve our lives while laying the foundation for American leadership in the apps economy. This spirit can be tapped for big bandwidth, as expressed by a student at the recent announcement of a gigabit network in Maine. He said that while having the world’s fastest network would bring “immediate benefits” to his start-up and state, the most exciting thing was “what we don’t know yet.”
“What we don’t know yet” is embedded in the DNA of every journey, each of which began with great optimism but no map. Whether Columbus, Lewis and Clark, the astronauts or the fathers of broadband, American heroes don’t follow a map; they make the map. Whoever is President in 2013, the message for policymakers remains the same: It is time to chart America’s big bandwidth map.
Blair Levin is the founder and Executive Director of Gig.U. In addition to leading The University Community Next Generation Innovation Project, Mr. Levin serves as Communications & Society Fellow with the Aspen Institute Communications and Society Program. Prior to launching Gig.U, Mr. Levin served as the Executive Director of the Omnibus Broadband Initiative at the Federal Communications Commission. In his role at the Federal Communications Commission, Mr. Levin oversaw the development of a National Broadband Plan.