Investing in Technology Infrastructure

All the consumer confidence and legal support in the world won’t boost e-commerce if there’s no way to deliver electronic content to customers efficiently and quickly. The future of electronic delivery demands a dramatic evolution of the telecommunications infrastructure in the United States and across the globe. Today’s infrastructure was built to carry voice telephone traffic and has served well for the last 50 years. But, the information age is placing new demands on this system-demands that it cannot readily meet. Today’s slow transmission speeds and congestion are a legacy of an outdated system that must be modernized, lest consumers and businesses turn away because of the “world wide wait.”

High-speed constant connections to the Internet (broadband access) let users send and receive far larger volumes of information than traditional dial-up telephone lines allow. Broadband access can be provided through modified cable television lines, an enhanced telephone service called Digital Subscriber Line (DSL), satellite, fixed-wireless, and other means.

Broadband access is absolutely necessary in order to make the vision of new, exciting Internet-based services a reality. For example, highly anticipated interactive applications (whether online classrooms, business showrooms, or health clinics) cannot exist if users lack broadband access.

In the United States today, roughly 70 percent of American households have access to the Internet, according to NielsenNetRatings. But, fewer than 10 percent of U.S. households have broadband access.

Many other nations rival the United States in their level of Internet penetration. In Sweden, nearly 75 percent of citizens have access to the Internet, whereas the number in Canada is 58 percent. But globally, broadband access rates are even lower than in the United States.

Several factors conspire to stymie more extensive broadband deployment. There are financial challenges, changing market conditions, uncertain consumer preferences, and even cultural and societal trends. In this environment, policymakers must take the lead and encourage the provision of broadband to consumers and their homes over the so-called “last mile.”

There is also a need to ensure that individuals in all sectors and geographical locations enjoy the benefits of broadband access. Not surprisingly, early evidence suggests that, in the United States, the rate of broadband deployment in urban and high-income areas is outpacing deployment in rural and low-income areas.

The preceding disparity has raised concerns that the “digital divide” (the gap between information “haves” and “have-nots”) will increase. The digital divide is a major concern for companies who have worked individually to expand access to computer technologies in underserved areas. They recognize that a global e-commerce technology future depends on widespread access to new technologies, particularly by individuals who have thus far failed to share in many of the communications and productivity benefits that technology brings. For all these reasons, many e-commerce companies support policies to promote broadband deployment in a way that will enhance widespread access to technology and, in so doing, close the digital divide.