Is "broadband for all" a recipe for recovery, or a boondoggle?
[Commentary] Broadband, goes the thinking, could boost economies in much the same way as railways and highways did in previous eras. But throwing state funds at technology may not be the best approach. Other things can be done to increase broadband penetration before dipping into the public coffers. A recent study for the British government by Francesco Caio, a former chief executive of Cable & Wireless, listed a few of them, including accelerating the release of radio spectrum, fostering competition and relaxing the rules that prevent companies from stringing up overhead cables. Furthermore, there is no clear market failure that demands government intervention, argues Michael Nelson, a professor at Georgetown University. Indeed, although America ranks 15th among OECD countries in broadband penetration, the country's telecoms firms are already spending billions building next-generation networks. And simply digitizing health records or promoting the spread of broadband may not produce the desired economic knock-on effects without investment in the fields that will use these technologies, such as health and education. Perhaps the biggest risk of all these broadband plans is that incumbents will exploit the crisis to gain regulatory concessions limiting competition and open access to their networks in exchange for promises to invest. This could even help recreate the telecoms monopolies of old. But if this recession has proved anything, it is that what goes around, comes around.