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12/15/2005

Broadband Use by Rural Small Business
by Douglas Mathew, Graduate Assistant, UALR SBDC

This study is done by Small Business Administration (SBA) to find the use and advantages of Broadband services in US rural areas. The key finding is that the broadband services are not very popular in rural small business consumers. The study found out that the urban small businesses has a better broadband services subscription rate than rural small businesses (rural digital divide).

The study also figures that the rural small businesses are missing the business benefits of the new technologies facilitated by subscribing to broadband services. This study finds that the following are the factors that accounts for the rural digital divide.

• Firm Size: The rural small business firms have fewer employees than urban small businesses.
• Higher Cost and Price: The rural small business pay higher price for broadband services than urban small businesses pay.
• Price elasticity: when the prices go up the demand goes down, because the broadband services are price elastic.
• Demographic factors: education, age group

If you are a small business interested in knowing more about this Small Business Administration (SBA) research summary about broadband services, visit http://www.sba.gov/advo/research/rs269tot.pdf .

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Arkansas Small Business and Technology Development Center
University of Arkansas at Little Rock - College of Business
Donald W. Reynolds Center for Business and Economic Development
2801 S. University / Little Rock, Arkansas 72204
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The Arkansas Small Business and Technology Development Center is funded in part through a cooperative agreement with the U.S. Small Business Administration through a partnership with the University of Arkansas at Little Rock College of Business and other institutions of higher education. All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect the views of the SBA. It is the goal of UALR to eliminate discriminatory harassment and to promote equal opportunity regardless of race, gender, color, national origin, sexual orientation, age, religion, veteran's status, or disability.