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Guest Commentary: May 29, 2001
Lack of Broadband Access Slowing Internet Growth
The Honorable Jane Harman
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Broadband access to the Internet is critical to the growth of the Internet and, because the Internet plays such an important role in our economy, critical to our overall economic vitality. Consumers need broadband in order to access the rich entertainment and information resources that the Internet can offer. Large and small businesses need broadband to communicate with suppliers and customers to be competitive in global marketplace.
Broadband translates into productivity, and the productivity gains that businesses have achieved by using information technology are an irreplaceable cornerstone of the unprecedented economic prosperity we have enjoyed for the past five years.
Unfortunately, broadband services have expanded much slower than anyone projected -— 88% of US homes still have narrow-band dial-up services. In spite of the limitations of cable broadband and the fact that the entire country is wired with the telephone lines that are needed to provide broadband access through DSL, only 25% of broadband customers have DSL and 75% cable.
The consequences have been devastating. Large and small companies that provided DSL have gone out of business or are teetering on the edge of bankruptcy: Northpoint, PSInet, Pioneer and countless others. The companies that provide goods and services to the DSL providers -— bedrocks of the Internet and technology economy like Cisco and Nortel -— have scaled back their operations and revenue projections. Content providers that were counting on a customer base with broadband access have been left high and dry; the entire sector has almost ceased to exist. Those companies had a strong presence in the Los Angeles region and in my district -- California’s 36th. Banks, venture capital funds and other institutional investors have watched portfolios that depended on broadband collapse. Every American who owns stocks or has a 401K has felt the impact. Hundreds of thousands of jobs have been cut.
I am not blaming the collapse of the Internet economy on the failure to meet projections for consumers access to broadband. There were many other factors at work. But lack of broadband must be considered one of those factors.
Note: This column has been adapted from a statement Rep. Harman delivered during a House Committee on Energy and Commerce hearing, April 24, 2001.
 How to contact Rep. Jane Harman (D-California)
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