How Much Would We Gain from Statewide Broadband?

How Much Would We Gain from Statewide Broadband?

Broadband internet is a valuable utility that keeps businesses, education, innovation, entertainment, and more flowing at high speeds, but many Hoosiers still don’t have access to it. In fact, if you look at the statewide broadband access map published by the state, the available coverage looks like a modern art piece; a splotch of color here, a splotch there, leaving thousands of households and businesses left in the slow lane. How does this impact our economy?

Recent research suggests our economy would gain about $12 billion in benefits if we were able to close the broadband gap throughout the state. We’d see about another $3.24 billion in added government revenue and health care cost savings alongside that overall benefit gain as well.

That’s according to a study from the Purdue Center for Regional Development, who published its findings on commission from the Indiana Electric Cooperatives, the Tipmont REMC, and CoBank which provided the funding.

“Reliable internet service is as vital to modern economic development, education, and healthcare as electricity,” said Tom VanParis, CEO of Indiana Electric Cooperatives.

The study’s authors based their findings on data from seven different rural electric member cooperatives (REMCs) in the state of Indiana. Then, the benefit-cost results of these seven REMCs were extrapolated to the state overall.

“From a societal perspective, the rural broadband investment is clearly quite attractive,” the study’s authors said. “The state of Indiana would receive about $12 billion in net benefits if the broadband investment were made statewide. That translates to $1 billion per year annuitized over 20 years at six percent interest rate.”

There are a multitude of reasons why greater broadband access would benefit Indiana. Some of the primary ones described by the study include:

  • Modern Health Care. Rural Hoosiers would be able to take advantage of prompt access to specialists and expanded monitoring and treatment options, providing greater access to advances in modern health.
  • Modern Education. Technology would be available to keep rural students from falling behind their urban peers and adult learners would also have access to distance education options that could improve job skills and opportunities.
  • Economic Development. With quality internet service, local small businesses can enter a global marketplace, agricultural and business income opportunities expand, rural areas will become attractive homes for skilled employees and their families, and more.

In addition to those mentioned there are also other sectors to consider, such as our burgeoning tech community, advanced manufacturing, telematics, automation, robotics, and so much more. Virtually every industry in the state has something to gain from an expanded broadband network.

The study indicated that a return of nearly $4 to the local economy is expected for every dollar spent on the necessary infrastructure to bring broadband to the whole state. But, there’s a bit of a catch. Revenue from customers would not be enough to cover the costs of a total system upgrade, even with new people becoming part of the customer roster. So additional financial assistance is going to be needed to support the infrastructure investments.

Perhaps it was great timing that the state announced a multi-million-dollar effort to support such an endeavor then, not more than a week after the study’s findings were published. Obviously, Indiana’s legislators had been working on the funding for some time, but it was kind of fortunate to see the two announcements correlate so closely to one another.

 

Our State’s Leaders Agree

Just a few days after the study came out, Governor Eric Holcomb announced details of the Next Level Connections infrastructure plan. Part of the plan involves a commitment to provide $100 million to bridge the digital divide in rural areas of the state. A grant program will be created to bring high speed, affordable broadband access to unserved and underserved areas of the state.

The governor’s office stated that, “Affordable, high speed broadband has become a business and personal necessity. Hoosiers should be able to connect to high speed, affordable broadband regardless of where they live, work, or go to school. The state will work with providers, communities, and other groups to design the final grant program and determine how to best optimize the investment.”

Once established, the grant program will include a state and local match. Indiana will offer grants for providers to bring broadband services with a minimum of 100/10 Mbps to areas of the state lacking service.

There are also other major connectivity plans included with the Next Level Connections initiative, not all of which pertain to internet accessibility. Indiana’s trail networks are going to be receiving about $90 million worth of upgrades, some of which may include additional utility work around them as well. $790 million is going to be used for major highway improvements. $20 million is going to be used to add more international, nonstop flights to and from Indianapolis. Funds will be used to study and potentially purchase land for a fourth port. And lastly, additional funds will be used for Northwest Indiana’s major rail projects, including the West Lake Corridor and the South Shore double tracking.

 

Time to Watch Our Network Grow

Indiana has about 12 billion reasons to bring fast internet to more of its communities and the state is soon to be distributing about $100 million to see that it happens. This could just be the beginning of growth spurred on by faster and better internet, as companies around the country are sure to begin noticing our improvements. Given the high-tech nature of so many business processes these days, it’s clear that bringing broadband to more areas will be a very positive thing for business.

Category Features, Tech Lab