Half of Americans lack the reliable internet access it takes to start a business in 2021. Biden's infrastructure plan could change that.
- Just as electricity was essential for business in the 20th century, now broadband is for the 21st.
- Census data show much of the US lacks consistent internet access in rural and urban areas alike.
- Biden’s $2 trillion infrastructure plan contains $100 million to get the entire country online.
- See more stories on Insider’s business page.
When Bryant Suellentrop left his office job to start a janitorial business
, he didn’t dash off to buy a van-full of cleaning equipment and supplies.
He went to the web.
Using his digital marketing and web design skills, Suellentrop assembled an online profile for American Cleaning Enterprises (ACE) and added his business to Google Maps in Greenville, North Carolina.
Only after he had landed his first service contract did he invest in tangible equipment like a commercial-grade vacuum, cleaning chemicals, cloths, mop, and bucket.
A few years before the 24-year-old Suellentrop was born, Bill Gates famously said, “If your business is not on the internet, then your business will be out of business.”
But in spite of the internet’s importance, research from Microsoft puts the number of people “not using the internet at broadband speeds” at nearly 163 million. A provision in President Joe Biden’s infrastructure plan aims to get that number to zero.
After all, if it weren’t for the internet, ACE (and the jobs it’s creating) wouldn’t exist.
‘Broadband internet is the new electricity’
Electricity, phones, and fax machines were the essential tools for business in the 20th century — in the 21st, it’s broadband access.
“Broadband internet is the new electricity,” the Biden administration says in its plan to invest $100 billion in improving American connectivity.
Mike Botkin observed this when he acquired a landscaping business from an owner who had run the company for 30 years using only a fax machine and a voicemail service to receive customer inquiries.
Botkin saw that the company’s old-school approach was causing it to miss out on a massive growth opportunity in the rapidly expanding Orlando, Florida, lawn care market.
“A lot of those businesses are owned by an older generation,” he told Insider. “They’re living in techniques and processes from the 80’s.”
Not only did Botkin’s digital strategy instantly lead to increased monthly sales and quicker payments compared with the original owner, he landed crucial six-figure investment to purchase the business by sharing his pitch on Twitter.
25 million Americans lack access to reliable internet
Even the success of hands-on local service businesses like Suellentrop’s and Botkin’s depend on having reliable internet access.
Unfortunately for many would-be entrepreneurs across the US, bad internet access is a problem in rural and urban areas alike.
Census data show that much of the US lacks consistent access to broadband, most especially on tribal reservations and vast swaths across the Sun Belt where physical infrastructure is lacking. In several counties, more than half of households lacked broadband access.
Closer inspection of the map also reveals how urban centers in places like Washington, DC, and Chicago have markedly lower access than their surrounding suburbs. The cable and fiber may be in place, but if the cost is unaffordable, it may as well not exist.
Either way, that lack of access limits opportunities to grow successful businesses and create new jobs in new places.
The broadband improvements proposed in Biden’s $2 trillion infrastructure plan are modeled off of the 1936 Rural Electrification Act, which helped lift the country out of the Great Depression by enabling households and farms across the country tap into the power grid.
The plan addresses key challenges of high-speed internet availability, affordability, and reliability so that the opportunities to build a 21st century business aren’t confined to areas of the country like the Bay Area or the Northeast Corridor that are already doing well in the digital economy.
Chattanooga shows the impact of gigabit internet
The city of Chattanooga, Tennessee, shows the impact this kind of investment can have on a community moving out of the 20th century economy and into the 21st.
Ten years ago, the city committed to building a high-speed internet service at a cost of $330 million, paid for with a combination of $105 million in federal funds and $225 million in municipal bonds.
By 2016 the local unemployment rate was cut nearly in half, wages were rising, and the city was earning a reputation as a leading hub of startup activity in the South.
“We know that the wage rise is linked to internet jobs and particularly the technology sector,” Mayor Andy Berke told the Tennessean at the time.
When COVID-19 struck last year, Mayor Berke told Insider that Chattanooga’s digital transformation made the city’s economy more resilient and able to deal with the shocks of the pandemic.
“If you’re a business, if you’re a home, you need high-speed broadband to be connected to society. Right now, it is basic infrastructure like water and roads,” he said. “We have a lot more to do to make good on the promise of high-speed broadband.”
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