Broadband Communities

SEP 2018

BROADBAND COMMUNITIES is the leading source of information on digital and broadband technologies for buildings and communities. Our editorial aims to accelerate the deployment of Fiber-To-The-Home and Fiber-To-The-Premises.

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ECONOMIC DEVELOPMENT | B R O A D B A N D C O M M U N I T I E S | w w w. b r o a d b a n d c o m m u n i t i e s . c o m | A U G U S T / S E P T E M B E R 2 0 1 8 Topics in Economic Development A roundup of recent research on broadband and economic issues A new paper from Purdue University projects the net benefits that could result from installing rural broadband in the areas served by rural electric member cooperatives (REMCs) in Indiana. Seven Indiana REMCs were studied, and their benefit-cost results were extrapolated to the entire state. Benefits included savings from telemedicine, education, business investment, consumer savings and farm income. e benefit-cost ratios ranged from 2.97 to 4.09 for the seven REMCs. From a societal perspective, extending this investment through the rest of Indiana is clearly quite attractive. However, the anticipated revenue from customers is not adequate to cover the total system costs, so some form of external assistance will be needed to incentivize the investments. e sum of net present value of benefits for the seven cooperatives was $2.25 billion, or $24,293 per member. Extrapolating the net benefits for these seven REMCs, the total for the state of Indiana would be $12.0 billion if the broadband investment were made statewide. at translates to $1 billion per year annuitized over 20 years at a 6 percent interest rate. In addition to the benefit-cost analysis, the report quantifies additional state and federal tax collections and cost savings as a result of the broadband investments in these seven REMCs. ese tax/cost enhancements amount to $56.5 million in year three, or 27 percent of the total net benefits of $208 million. See: "Estimation of the Net Benefits of Indiana Statewide Adoption of Rural Broadband," by Alison Grant, Wallace E. Tyner and Larry DeBoer, August 2018, Purdue University Center for Regional Development, Benefits of Electric Co-ops' Investments in Broadband Smart cities enabled by broadband technology can play key roles beyond traditional economic development, according to a new study published by ABI Research. Cities can redefine and restructure their economies through the deployment or stimulation of new economic paradigms, such as smart contracts for trade, distributed microgrids for energy and shared mobility for automotive and transportation. New paradigms include the following: • Sharing Economy: Consumers and enterprises abandon asset ownership and instead use pooled assets in a more efficient, "as a service" manner. Examples include future driverless car sharing. • Peer-to-Peer Economy: A special case of the sharing economy, peer-to- peer models link consumers directly in a disintermediated way. Examples include car sharing as well as home and office space sharing. Other examples include parking space and electric vehicle charging station sharing. Peer-to-peer models are still based on private asset ownership. Consumers and small enterprises can also engage in peer-to- peer lending as well as invest in each other's The New Urban Economy

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