Despite having the reputation as one of the most tech-savvy states in the nation, California’s average Internet speed is only the 18th fastest out of the 50 states. How is it that the home to Apple, Google, Hulu, and countless other digital leaders isn’t also one of the nation’s leading states in connectivity?

One group thinks it knows the answer. The Bay Area Council Economic Institute (BACEI) describes itself as a “partnership of business with labor, government, higher education, and philanthropy that works to support the economic vitality and competitiveness of the Bay Area and California.” In a recent report, “21st Century Infrastructure: Keeping California Connected, Powered, and Competitive,” the group claims that it’s a focus on the past that’s holding California back.

It Got Us This Far, But…

BACEI credits California’s current economic and technological successes to a half-century of investing infrastructure including universities, highways, public utilities, and telecommunications. That infrastructure paved the way for success, the group says, but future infrastructure needs will be different, and California’s regulatory environment is suited to building the last century’s infrastructure, not the next century’s.

California, like the rest of the nation, trails many other nations in broadband infrastructure, and predicts future data needs will overwhelm California’s current networking capacity. In particular, BACEI points to the Internet of Things (IoT), a “tsunami” of applications, and the energy industry as three of the near future’s biggest data users. The Institute predicts a need for a connected “smart grid” to manage energy usage and delivery. Such a grid is already in operation in Chattanooga; by adding interconnected sensors to the electrical grid, the grid becomes stronger, but thousands of new sensors also increase data demands.

Bandwidth Over Speed

Though speed is important, BACEI notes that the huge volume of connected devices coming online over the next several decades makes bandwidth even more critical. According to the report, Internet traffic has expanded by a factor of 450,000 in the last 20 years, and the number of devices that share data from machine to machine will quadruple between now and 2018. More than 2 billion smart devices including industrial sensors, like those for the smart grid, and wearable technology will be online and communicating with each other, absent human intervention, by that time. Cloud storage will have increased 300 percent from 2013-2018.

Regulatory Hurdles

One example used to illustrate the way in which California regulations focus on the past, rather than the future, is the phone system. The report notes that AT&T and Comcast have both invested in digital/Internet-based phone networks but, as they invest in that future technology, California law requires them to maintain traditional copper wire-based phone networks that will someday be obsolete, if they’re not already. Obviously, money used to keep up legacy networks can’t be used to invest in more advanced technology.

Proposed Solutions

Anyone can point out problems, but to BACEI’s credit, they also propose solutions for improved future regulations. Some recommendations are focused on the energy industry, and aren’t especially relevant to connectivity, but three of these recommendations are directly related:

1. Plan for local network construction by considering the logistics of where to locate resources, and reduce the amount of red tape necessary to build new networks.
2. Eliminate regulations that hinder future progress by focusing on the past.
3. Create a state-level task force with input from state and municipal government, industry, network providers, regulators and public interest groups to examine future network infrastructure needs.

This task force will help further the first two recommendations.

BACEI also has recommendations for specific infrastructure worthy of investment. It points to fiber, of course, but also mentions next-generation, gigabit-capable copper and coaxial wire, mobile cell towers, and microcells/distributed antenna systems to boost wireless reception.

Benefits of Broadband
From a consumer’s perspective, better Internet means more speed. But there’s more to it than the ability to load cat pictures faster. BACEI says for society, better broadband means:

A better economy: a 10 percent improvement in broadband penetration results in a 1.21 percent increase in gross domestic product.
A better environment: smarter networks help reduce energy and water use and waste.
A better education system: 50 percent of teachers say poor connectivity inhibits their lessons.
A better state of public services: smart devices will mean improvements in everything from waste collection to traffic.

Embrace the Inevitable

As we’ve pointed out before, the IoT, increased bandwidth, and high-speed Internet connectivity are likely to create a future in which virtually everything in our lives will be connected in some way. This is the future that California has to plan for with better infrastructure. But because interconnected systems mean the potential for a problem with one system to affect another, regulations for that new infrastructure need to offer freedoms, but also safeguards.

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