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Study backs Cisco chief's Net notions

While Cisco Systems' chief John Chambers continues to expound on the promise of the Internet, a new study says the medium generated more than $300 billion in revenue and 1.2 million jobs this past year.

ATLANTA--While Cisco Systems' chief John Chambers continues to expound on the promise of the Internet, a new study commissioned by the company and completed in conjunction with the University of Texas says the medium generated more than $300 billion in revenue and 1.2 million jobs this past year.

The study, funded by Cisco and researched by the University of Texas Graduate School of Business and the Center for Research in Electronic Commerce, is intended to quantify the effects of Net-related businesses on the overall economy, according to company executives and the professor in charge of the effort.

The results are also intended to underscore the notion floated often by Chambers that the Net will change the nature of economies, education, and domestic and social life. "Cisco's going to push the envelope as far as we can," the executive said during a speech here at the Supercomm industry trade show.

The findings also say that Internet-related workers are 65 percent more productive than non-Internet-related workers and the top 20 companies with "significant" Internet-related revenue combine for nearly $2.4 trillion in market value. Internet-related workers top the productivity of their industry counterparts, according to the study, bringing in $250,000 compared with $160,000 per employee.

It also found that electronic commerce revenue totaled $102 billion for U.S.-based companies in 1998.

Anitesh Barua, an associate professor of information systems at the University of Texas, said the school took a holistic approach to their research, hoping to shed light on what some view as a mysterious phenomenon. "You hear a lot of speculation, a lot of stories," Barua said.

Cisco makes equipment that is used across the Internet and has continually hyped the potential for the Net and networking in general.

Reseachers used interviews with 3,000 U.S.-based companies with all or part of their revenues being derived from the Internet as the basis for the study, with various companies separated into four different "layers" based on their models. "It's a study done completely independent of Cisco," Barua said.

The findings can be found on a Web site. Further work will result in quarterly reports.

Cisco executives said they hope the new data may have the side effect of showing those in Washington D.C. who want to further regulate the Internet that the medium is working just fine independent of federal intervention. "That is our hope and a secondary effect," said Don Listwin, executive vice president at Cisco.

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