Deloitte: Broadband for all to tackle digital divide

A new report from Deloitte called Broadband for all: charting a path to economic growth has evaluated the connection between broadband internet access and economic growth.

The report also explores what needs to be done to close the so-called digital divide – to optimise the economic and social benefits while reducing inequalities. However, after a decade of infrastructure investment that saw billions of dollars of private and public investment in broadband, the results have been disappointing.

According to the report:

• Between 2010 and 2020, federal programs spent approximately US$107 billion.

• In 2014, the last year of the 4 Mbps downlink benchmark, 16 million Americans (approximately 5% of the US population) did not have broadband services that met that standard.

• In 2019, after five years and approximately US$54 billion, 14.4 million Americans did not have broadband that met the new FCC speed threshold (25 Mbps downlink).

“The pandemic hastened the pace of a decades-long trend in which innovative applications are increasingly essential to enhancing educational opportunities, organising our lives, connecting with colleagues and friends, improving workplace productivity and enriching the quality of lives,” said report co-author Dan Littman, principal, technology, media and telecommunications at Deloitte.

“If large segments of our population lack the necessary communications infrastructure to participate, progress will be increasingly difficult.”

The COVID-19 pandemic forced many Americans to work from home, but many simply did not have access to adequate or affordable internet connectivity or mobile devices. This highlights what the report calls a pivotal moment for the US economy. More than US$100bn of infrastructure investment has been allocated by the government to address this issue but the digital divide remains.

The impact of broadband access on US jobs<

According to the report, access to broadband can have significant impact on the US workforce:

• A 10% increase in broadband penetration in 2016 would have added 806,000 additional jobs in 2019, or an average annual increase of 269,000 jobs.

• More than 875,000 additional jobs and US$186 billion more in economic output would have occurred in 2019 had there been a 10% increase in broadband access in 2014.

• Adding 10 Mbps to average download speeds in 2016 would have resulted in 139,400 additional jobs in 2019.

“When it comes to the public or private broadband investments to close the digital divide, the economic benefits are clear, but will require stakeholders to navigate potentially competing priorities across emerging technologies that can meet needs in the near-term, the long-term desires for faster speeds, and financial support for devices and in-home equipment,” concluded report co-author Jack Fritz.