In this guest post, Cisco Systems Chairman and CEO John T. Chambers states his case as to why he believes broadband was such a crucial part of the stimulus package — and how faster broadband speeds will not only transform our economy, but our society.

Now that President Obama has signed the $787 billion economic stimulus package into law, the real hard work begins: using that money to create jobs. If spent wisely, this package has a chance at fundamentally reforming the U.S. health-care system, making our economy energy efficient and providing Americans with the training and skills required to succeed in a 21st century global marketplace.

But the country can’t accomplish these goals unless it has the infrastructure to support them. That’s why the funding for broadband was so vital. Broadband is the ticket for entry to participate in the world economy. It is a fundamental technology upon which other things are built. It enables collaboration, innovation and operational excellence, and positions the U.S. to compete on a global basis.

The impact of broadband has been similar to that of the national highway system in the 1950s. Until then, our nation’s roads were slow and the quality was unpredictable, which hindered commerce and travel. The modern highway system made our country accessible and in the process, created new industries — transforming our economy and by extension, our society.

That is what ultra high-speed broadband does. Think of how far we’ve come in just the last decade, when dial-up was the norm and the Internet was only used to surf, send an email, or order a product or service. Now the Internet is largely defined by video and various levels of interaction among users, such as through virtual meetings with co-workers located in cities around the world.

Increasing our broadband speeds to 100 Mbps from the current U.S. median of 2.3 Mbps will have a transformative effect on our economy and our society. High-speed networking enables new human collaboration at a profound level, and such collaboration will radically change the way we think.

In health care, for example, dynamic collaboration by way of ultra high-speed networks will help researchers find cures for diseases faster. On a more personal level, remote consultations with doctors via our HealthPresence system are enabled when life-size, “HD” images and information are transmitted over such networks to doctors who can speak to directly to patients, view the data real-time and help make a diagnosis hundreds if not thousands of miles away. Indeed, as the Baby Boomers place ever-more stress on our health-care system, telemedicine is the next frontier, but it cannot happen unless all of our connections are fast and reliable, be they in the office or at home.

If 100 Mbps at home seems ambitious, consider this: Japan and South Korea are already reaching that level. According to a forthcoming research paper by the Information Technology & Innovation Foundation, South Korea — a country with 1/6th the population of the United States — has almost as much Internet traffic. That’s because they’re already operating at average speeds of 49 Mbps.

In the U.S., ITIF projects that high-speed connections to the home would increase the number of telecommuters to 19 million by 2012. That would save 1.5 billion hours of commute time — and reduce gasoline consumption by 5 percent. It is a green technology, one that can help us kick our oil habit.

And just as importantly, it would accomplish our goal of creating jobs. Deploying next-generation broadband to 80 percent of U.S. homes would create some 2 million new jobs, according to the upcoming ITIF study. In short, if we invest and build a national broadband infrastructure for the entire country, everybody benefits.

As our policymakers work on maintaining U.S. competitiveness, they should keep in mind that broadband is the vehicle by which our citizens can be more productive, health care can be modernized, our economy can become more efficient and innovation can flourish. To continue our nation’s growth, add jobs and drive innovation, we must invest in broadband.

John T. Chambers is the chairman and CEO of Cisco Systems.

  1. [...] he must do. I am personally going to judge him on what he gets done, and not what he talks about. As Cisco CEO John Chambers argues, we need a broadband strategy befitting a country that has long been a technology leader and [...]

  2. @John,

    Your commentary is spot on – though some will likely view it as self serving. To be clear, I not only agree with your arguments, but will add that i’ve run a startup which has employed nearly 10 without any need for a physical office. This includes all aspects of development, meetings, code reviews, etc.

    It is my belief that if american companies placed more trust in their employees (outside of Silicon Valley), and created work and reward systems centered on measurable productive output using broadband networking, we could move american companies into positions of worldwide leadership once again.

    My $.02,



  3. https://twitter.com/paramendra/status/1277464637 This article is long on vision. The clarity of thought is all over.

  4. The UK Government has not provided any subsidy/stimulus in the same way as in the USA although yesterday the regulator Ofcom did announce that it would remove any regulatory barriers that might constrain BT’s business case.

    BT has been arguing that it cannot make a sufficuent return on its investment to make that investment worthwhile in the UK. This is becasue up until now, due to BT’s significant market power, the pricing it can charge has been set by Ofcom.

    see post here http://www.trefor.net/2009/03/03/ofcom-gives-bt-green-light-for-fibre-investment/

  5. @John

    Thanks for the post. I think most people fail to recognize the fact that broadband is like processor-power in the PC era. The more you have, the more you can use. In fact, more bandwidth means more creative applications, many which are not even imagined just yet.

    I think given the high degree of innovators and creators in Silicon Valley, it makes a lot of sense for us to have “big bandwidth” in the US. I think you and your peers need to keep pushing to make the future possible for us.

  6. Whether broadband is the best answer or not, I think it’s absolutely clear that investment in technology infrastructure needs to be a top priority. And for that to happen, one thing we need more of is technology leaders stepping up and making strong cases like Reid Hoffman did in his Washington Post op-ed today and John Chambers is doing right here blogging on GigaOm. The fact that a major tech leader like John Chambers is posting on GigaOm is evidence in itself of how far technology innovation can come so quickly – as long as the right investments are made to support that innovation.

  7. Reading through this post I started to think that it seemed a bit self serving. However, the plain fact that Cisco has had the vision to participate and continue to invest in these particular sectors shows true vision – Tough for anyone to argue.

    I think that we all agree going forward the USA needs to become more productive. Broadband (including WIMAX) are the main ingredient in the equation. The world is truly flat and without greater access we will continue to let the rest of the world catch up.

    Last month I was traveling through Bolivia and had an opportunity to visit with some software development firms. I was truly amazed at the level of talent that rivals any other place I have visited. I use this example because Bolivia is a tiny country that most people know nothing about. As a matter of fact when people think of engineering talent in South America the countries that come to mind are Brazil and Argentina; and rightfully so.

    The world is truly flat.

  8. @Alex

    You are absolutely right in your observation. Why broadband has been equated to the highway-transport infrastructure of the past, I think of broadband as a platform and thus equate the bandwidth to processing speeds. I think we need to start looking at the world through those eyes in order to realize the critical need for broadband.

  9. I have to agree with the comments John makes here. It is common sense and draws on some good economic theory

    -) Money is in information these days – in the old days it was in commodities – steel, meat and coal. These days the value of enterprise resides in or is transacted in bits. The precursors to global wealth and civilization in the early days were roads and later man made canals – the faster you could travel the bigger the market for your produce (before it rotted). It makes sense in the age of information to create the roads for that information to travel cheaply and unhindered – the broadband network. Imagine if you had to commute rocky roads to get your work to your boss. Accept no substitute – dial up and even DSL is about as acceptable as a chocolate teapot.

    -) Move bits not atoms – Jonathan Koomey said that one to me and it rings so true – we need to improve the infrastructure to move bits faster and cheaper to wherever we want them to go rather than hopping in planes and cruising in cars. Allied to the US dependence on consumer credit and it’s subsequent consequences we now need to rethink transport infrastructures to be geared for bits rather than atoms. Oh yeah – the side effects would be to help towards saving the planet.

    America needs to let go of its dependence on gasoline, highways and airports and rethink itself out of the downturn by connecting it’s next generation of workforce with the tool it most needs – proper Broadband.

    There may be a silver lining in this downturn after all – the US economy has sunk to it’s lowest and now needs to have a sit down on the stairs and ‘think different”. The crash and the subsequent stimulus proposals may be the much-needed intervention to change our bad old habits.

  10. John,

    I think that your sentiments are dead on, and as an entrepreneur, I can’t wait for the day when really good broadband is ubiquitous, but I question the suggestion that this is a segment of the market that requires stimulus dollars.

    Imperfect, sure, but this is an area where the market seems to be working.

    If anything, I would love to see stimulus dollars targeted at funding small businesses that are under the radar of being VC-worthy (i.e., not $100M+ business opportunities) but have the potential to grow into real businesses ($10M+ business opportunities).

    Expanding upon your concept, why not focus these dollars on businesses that fit within a transparent underwriting criteria (including capital efficiency) AND which uniquely leverage broadband as a cornerstone driver of their business.

    As one who believes that the long-term growth of the economy hinges upon small business growth, this is a great way to both provide funding mechanisms to an under-served segment and to spotlight what works in the age of always-on.

    Food for thought.



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