by Bruce Mehlman and David Sutphen
Sometimes you have to spend a little to save a lot. From the average American family to private businesses to our national government, the potential cost savings delivered by investing in broadband technology and innovation are significant.
The average annual cost of a home broadband connection is $490, according to the Pew Internet & American Life Project's report (PDF) "Home Broadband Adoption." While that is a significant sum, a broadband subscription is an investment. It's a great technology for penny pinchers.
A recent financial analysis titled, "The Real Cost of the Digital Divide," released by the Internet Innovation Alliance (IIA) and authored by Nicholas J. Delgado, certified financial planner and principal of Chicago-based wealth management firm Dignitas, found that American consumers can save $7,707 a year by having access to and using high-speed broadband Internet.
These savings on essentials like housing, food, clothing and basics like entertainment and travel come through discounts and sales only available to online consumers, in addition to the ability to price-comparison shop, as highlighted by a recent MSN Money story on the report. Broadband gives smart shoppers the tools to save large amounts of money, but it's a bit like a treadmill: if you have one, it can really help you get in shape; if you hang your clothes on it, not so much.
Broadband can also be budget-friendly for businesses, large and small. In Ohio, for example, the median annual revenues for businesses that use broadband are double those of businesses that do not subscribe to broadband, according to Connect Ohio's technology assessment. For businesses, broadband allows 1) saved time and resources with greater efficiency, 2) employees to access critical, time-sensitive information from any wired location in the world, and 3) the ability to reach unlimited, non-local markets. As explained by entrepreneur Becky Collins, owner of Grannybclothesline.com and an Internet Innovation Alliance Broadband Ambassador:
"The Internet has brought the world to my doorstep. Living in a rural community I could not have had a successful business. As the owner of a small home business, being able to market my product via the Internet is vital."
On a larger scale, our country's economic recovery could hinge on information technology including broadband Internet. According to a whitepaper (PDF) called "One Trillion Reasons" from the Technology CEO Council (TCC), the American government could save more than $1 trillion by 2020 by adopting commercially proven best practices to maximize operational productivity. According to the TCC, "applying proven and realistic business strategies" and "leveraging newer innovations in business process management enabled by advances in technology, such as broadband Internet," would give our government the ability to hugely cut costs.
More robust adoption by the government of broadband-enabled telework, for example, could be extremely advantageous for taxpayers. As noted in the aforementioned whitepaper, "The Telework Exchange estimates that, economy-wide, $441 billion in potential U.S. employer teleworker savings can be realized from reduced absenteeism, recruiting costs, and increased productivity." And not only would technology-enabled productivity solutions "generate $920-1,170 billion in savings over 10 years," they would also enhance the services the government provides citizens and lay a foundation for future innovation and growth.
The first step to realizing these cost savings is understanding the tools that are available. From your home office to the Oval Office, high-speed broadband Internet should be recognized as essential to all money-maximizing strategies in our digital society.
Bruce Mehlman and David Sutphen are co-chairs of the Internet Innovation Alliance (IIA) and monthly FierceTelecom columnists.