Broadband 'lubricant' for economic growth

By Dennis Seid/NEMS Daily Journal

TUPELO – People in rural areas have a greater appreciation for wireless access, which explains why rural states like Arkansas and Mississippi lead the nation in the percentage of wireless states.
While more than 25 percent of U.S. households are wireless, Arkansas leads the way with 35.2 percent of its households, followed closely by Mississippi at 35.1 percent.
“The first thought is young and urban populations lead the way,” said John Mayo, a professor of economics at Georgetown University’s McDonough School of Business. “But the data shows rural areas leading the way. Why? There’s lower population density, and more people are outdoors and away from their domiciles.”
So, people in rural areas depend more on having wireless access. In urban areas, the population is more densely packed, and access to a land-line phone is much easier.
“If you’re a farmer in the middle of your field and your tractor breaks down, it’s easier to have that cell phone than driving 10 miles back to the house,” Mayo said. “It’s common sense if you think about it.”
Mayo went on to say younger people, no matter where they live, are more dependent on wireless usage.
He noted that in 2003, only 12 percent of households headed by people 30 years and younger were completely wireless, e.g., they had no land-line phones. Today, that figure is more than 70 percent.
Mayo said broadband access in general is a “lubricant” for economic growth, helping attract business and industry.
In a study he co-wrote, Mayo said “greater broadband deployment is. … especially beneficial to rural areas by ameliorating or eliminating the economic challenges of geographic isolation and economic specialization.”
Wireless access is the preferred route, he said, but cost is always the largest hurdle to overcome.
“Do you use public or private sector funds?” he said.
The private sector has not shied away from investing in wireless networks, he noted, but plans like President Obama’s National Broadband Plan – which, as its name implies, would expand broadband access – would require public investment.
“And right now isn’t a good time to ask for public funding,” Mayo said.

Click video to hear audio