This study explores two popular beliefs pertaining to the deployment and use of
broadband services – first, that these services are enormously important to consumers and the overall economy, and second, that rural deployment and use of these services lags urban broadband deployment and use. If both of these beliefs are true, then it follows that the benefits of broadband services are failing to reach many rural consumers.

While the topic of a digital divide is not new, this research is somewhat unique in that it focuses primarily on rural small businesses’ use of broadband services. Based on the empirical evidence from a survey of small businesses and other research presented in this study, the following are key highlights of the findings:

• Broadband investment (and more generally investment in information technology) appears to provide substantial benefits to both consumers and the overall economy. Broadband investment and services appear to stimulate economic productivity and output, as well as create jobs.
• This study finds that rural small businesses do not subscribe to broadband services as frequently as urban small businesses do, and finds the difference in broadband use between rural and urban areas to be statistically significant.
• One of the drawbacks of the apparent rural digital divide is that rural small businesses are less likely to benefit from new technologies facilitated by access to broadband services. For instance, this study finds a statistically significant difference in Voice-over-Internet Protocol (VoIP) use between metropolitan and non-metropolitan areas, apparently due to the lack of broadband use in rural areas.