The Need for Speed
The ability to go “faster” is part of the culture of the United States. Whether it was moving from the horse and buggy to the automobile, the prop plane to the jet engine or moving from dial-up internet service to broadband, we are always looking to do things faster.
And every time we make a monumental leap in speed, economic prosperity springs eternal. While the tangible benefits are many times obvious, it is the intangible benefits that are more interesting to me. For example, when we moved from horse and buggy to the car, people were hired to make the cars. Likewise, steel became much more important which led to economic booms in towns like northern Minnesota and the steel belt. However – it was the intangibles that became interesting. This economic boon created tons of new jobs, which in turn led to the creation of many other innovations and industries such as the airline industry. It also created the need for highways and byways, reductions in cost and increases in trade.
We saw a similar phenomenon during the dot com era. Heading into that period, it was as if we didn’t have any idea what would be the end result. Amazon, online bill pay, PayPal, Google, etc… How could one predict all of what would happen by allowing people to connect to one another. This was pushed one step further when we moved from dial-up to broadband.
Flash forward a few years and here we are again. For the past decade, we, as consumers, have been rather content with our internet and current broadband speeds. The lay consumer will tell you that their broadband speed is “OK” and when you ask them what speed they are getting, the normal answer is “I don’t know”.
Today in the U.S., the average consumer with cable broadband is getting roughly 5 megabits per second of download speed and 2-3 mgbs of upload speed. This metric describes how much data you can download or upload over that connection. DSL, wireless and satellite connections are less than cable on average.
We are now at the forefront of what appears to be a broadband war. The broadband stimulus program is in full swing with billions of dollars having already been awarder to bring high speed broadband to the nation. Where this is all heading is not yet known, but the theme is the need for speed. Today the U.S. ranks in the 20’s as a nation on the broadband speeds given to consumers. Meanwhile, there are countries such as Singapore where the entire country is getting speeds of 1 gigabit. That’s right – speeds about 200 times what we receive today on average.
As we begin to move up the speed ladder, the most immediate benefits are fairly clear. We can get information faster. We can do things like watch TV (think advertisement) on our mobile devices. We can transfer very large online medical records in a flash.
However – it is those intangible benefits that are most intriguing. What other value chain items will be positively impacted?. What new technologies and innovations are going to be created? What new payment methods and trade will this enable? How will this re-vitalize rural areas that have not been able to participate in the global marketplace?
Will this next jump in speed lead to the economic springboard that we have seen in the past? If we truly do substantially improve our broadband infrastructure and speed, my answer is going to be YES. The other important question is whether the U.S. will move up the ladder or let about 22 other countries that are ahead of us reap the benefits.