While the great broadband debate rages on at Capitol Hill, a new study released yesterday said widespread use of high-speed Internet service in the near future could pump as much as $500 billion annually into the U.S. economy.

The study, conducted by the Brookings Institute in Washington, D.C. and titled "The $500 Billion Opportunity: The Potential Economic Benefit of Widespread Diffusion of Broadband Internet Access," said consumers would benefit from a greater deployment of the technology by using services such as online home shopping, entertainment and traditional telephone services, as well as possibly reducing commuting time. Demand for these services would also provide a boost to computer and software manufacturers as well as entertainment product companies.

Economist Robert Crandall and consultant Charles Jackson co-authored the study.

"Our study suggests that the benefits to U.S. consumers could eventually be upwards of $300 billion per year and that producers could reap another $100 billion per year if broadband were to be as prevalent as ordinary telephone service today," Crandall said in statement. "And that could be a conservative estimate. Because we cannot easily foresee all of broadband's potential uses--in health care, for example--we may have underestimated its potential."

The study comes as the telecom industry and many other businesses are feeling the effects of a slowing economy. The report provides information on varying high-speed Internet service offerings, including digital subscriber line, cable modems, satellite and wireless devices.

It estimates that 8 percent of American homes currently have high-speed Internet service. Five areas or activities that are likely to drive the service demand, the study says, are home shopping, reduced commuting, entertainment services, conventional telephone use and telemedicine.

The authors said they carried out the broadband study after having assessed the market potential of wireless telephony, conventional broadcast services and cable television in previous reports.

"Clearly, the impact of broadband by any measure--in terms of GDP, jobs, U.S. productivity, and efficiency--will be profound," Jackson said. "We're looking at a transformative technology: one that doesn't just create change at the margins of an economic system, but at its core."

The Bottom Line

Think House Energy and Commerce Committee Chairman W.J. "Billy" Tauzin (R-La.) and Rep. John D. Dingell (D-Mich.) will be referring to this study when the full House discusses the duo's broadband bill in the coming weeks?

The report leaves out one important detail: that most Americans probably won't hop on the high-speed Internet train because the $50 going rate is twice as much as the familiar dial-up route. Expect this to be a much-talked about report on the Hill and broadband circles in the next few weeks.