Broadband gaps hurt state business growth

Posted Sept. 26, 2010, at 7:20 p.m.

AUGUSTA, Maine — With competition worldwide and access to broadband in Maine sometimes less than that in a third-world country, the state’s small businesses are finding it hard to grow and expand or in some cases survive. That’s the conclusion of several business professors and lawmakers who say high-speed wireless access to the Internet is as important as good roads and bridges.

“Maine is 97 percent small businesses,” said Nory Jones, a professor at the University of Maine Business School and Director of Graduate Business Programs. “Small-business people don’t usually have the time or the expertise to keep up with the changes. But it’s also a big problem when they can’t get access in the first place.”

She said business owners of all types have told her in classes and at seminars about the serious problems they have in getting reliable access to the Internet. She said high speed, or broadband, is a must for almost every business, from restaurants on the coast to small craft businesses inland.

Jones said in an age where consumers can shop online for just about anything, a Maine maker of crafts, for example, needs a good website and broadband access to compete with other crafters around the world.

“There is a very popular application in the smart phones that allows a person to find a restaurant or some attraction, get directions to it and make a reservation,” said Howard Daniel, a marketing professor at the University of Maine. “This is used a lot now and is growing among those from the Boston area or New York. There are a lot of places in Maine where it just does not work because the wireless connection is not fast enough. When you cross the bridge and go on Mount Desert, it stops working.”

Mount Desert Island is home to Acadia National Park, the largest single destination point for tourists visiting the state. Daniel said the inability to use devices that people from away use every day at home will have an effect on some deciding whether to visit the state again.

“Broadband access, however it is delivered, is as important to business today as the roads that bring the tourists into the state, and I think it is clear we are falling behind,” Daniel said.

Jones said some areas of the state are still dependent on dial-up access, and in many areas that have access to broadband, it is often not as fast as it should be. She agrees with Daniel that in a rural state like Maine, wireless broadband is even more important as more computer programs — apps — are stored on computer servers and not on smart phones or other computer devices.

“Programs like accounting software and inventory software are now on cloud servers because it allows for better management of systems, but they need reliable broadband connections to work properly,” Jones said. “In many areas of our state, we still don’t have that access.”

A growing number of companies use “server farms” where huge amounts of data and programs can be stored safely and at less cost than at a small company. She said many companies use their desktop or laptop computers as work stations with business software programs and business data stored on “cloud servers” where business-critical information is backed up automatically.

Daniel said many smart phones and new devices such as the iPad use applications stored on cloud servers, and without wireless broadband access, they will not work.

“It is embarrassing at times,” said Sen. Chris Rector, R-Thomaston, who serves on the Legislature’s Business, Research and Economic Development Committee and the Broadband Strategy Council. “There are a lot of places where we do not have reliable cell phone service, let alone where the smart phones work.”

He said lawmakers have been trying to address the problem of providing broadband access of all types through the ConnectMe Authority that makes grants to build infrastructure in unserved and underserved areas. But he acknowledges the state as a whole is not keeping up with the changes in technology even with some large federal grants to improve fiber-optic connections.

“And it’s not just rural areas that have problems,” said Rep. Cynthia Dill, D-Cape Elizabeth, the co-chairwoman of the Broadband Strategy Council. She said there are cell phone service “dead spots” in her district in addition to the lack of high-speed wireless to connect phones to application servers. But there are significant in-vestments being made in the state’s broadband infrastructure.

“Over $35 million of investment is coming into the state to build out infrastructure to connect people to the Internet, and we are hopeful there will be more grants,” Dill said.

Cable companies and telephone companies are making significant investments in the state, but Dill agreed the lagging access to fast wireless connections is a problem.

“Technology is moving faster than we can keep up,” she said.

Rector said government must take steps to make sure the technology infrastructure is improved. He suggested the state should consider providing low-cost financing through bonds to encourage wireless providers to improve their networks.

“If our businesses are going to compete, we need to invest in technology like we do in roads and bridges,” Rector said.

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