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Carbon Disclosure Project 2011


Access to Broadband can help stimulate economic growth and generate jobs


The benefits of broadband go beyond just economics. In a world of increasing energy prices and resource constraints, equally relevant are the environmental benefits.


A number of studies have investigated the impact that broadband access can have on economic growth. The clearest correlation comes in job creation. It has been shown that for every one percentage point increase in broadband penetration in a state, employment is projected to increase by 0.2 to 0.3 percent per year. For the entire U.S. private non-farm economy, this suggests an increase of about 300,000 jobs, assuming the economy is not already at “full employment”.25 This relationship between broadband and employment tends to be stronger in industries where information technology services represent the larger share of an industry’s input. These industries include: information intensive industries e.g. media, computer programming and data processing; professional, scientific and technical services; administrative services; and education services.


Broadband also encourages upstream investment in industries creating new and innovative applications and services such as telemedicine, internet search, e-commerce, online education (distance learning), social networking and digital recovery. In their paper ‘The Future Built on Broadband’ the Broadband Commission highlighted that a single piece of software or innovative device can:26


1) Create a market e.g. eBay created a global market- place for online auctions. This platform has enabled a huge number of entrepreneurs to set up their own businesses with very low start up costs. eBay says 25,000 new businesses registered on the UK auction site between September 2008 and July 2010, taking the total to 140,000, a jump of 18%. Since 2008 these new businesses have turned over more than U.S. $324m.27, 28


2) Take an existing market online e.g. e-books. Amazon’s electronic books are now outselling their printed counterparts.29


3) Transform an established market e.g. the gaming industry is increasingly being delivered through online media and mobile devices and the industry is growing. In 2010, 72% of American households played computer or video games, 55% of gamers played on their phone or hand-held device, $5.8 billion was spent on non-traditional game formats such as digital, mobile apps and social network gaming. This is a growing industry that has generated more than 120,000 jobs in 34 states.30


4) Combine existing markets e.g. the smartphone can be used for calls, emails, social media and information gathering. In 2011, sales of smartphones are predicted to reach 468 million, a 57% increase from 2010.31


25. Crandall et al, 2007. The Effects of Broadband Deployment on Output and Employments: A Cross sectional Analysis of U.S. Data. Available from http://www.brookings.edu/~/media/Files/rc/papers/2007/06labor_crandall/06labor_crandall.pdf Last accessed June 16th, 2011.


26. The Broadband Commission, 2010. A 2010 Leadership Initiative. The future built on broadband. Available from http://www.broadbandcommission.org/report1.pdf Last accessed June 16th, 2011.


27. Rigby, C. 2010. eBay sees 18% rise in new business sellers since recession. Available from http://www.small-business-channel.com/featured/ebay-uk-sees-18-rise-in-new-business-sellers-since-recession/ Last accessed June 17th, 2011.


28. Converted from £200m using Reuters exchange rate 20th June 2011.


29. Cited in Kindle e-books outselling print books. Available from http://www.topcomputertablets.com/kindle-e-books-outselling-print-books/225622/ Last accessed June 16th, 2011.


30. ESA, 2011. Essential Facts about the computer and video game industry. Available from http://www.theesa.com/facts/pdfs/ESA_EF_2011.pdf Last accessed 20th June, 2011


31. Gartner, 2011. Gartner says android to command nearly half of worldwide market by year-end 2012. Available from http://www.gartner.com/it/page.jsp?id=1622614 Last accessed June 20th, 2011.


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