Exploring the impact of broadband and technology on our lives, our businesses, and our communities.
Charleston, South Carolina's very successful Digital Corridor program is worth careful study. Ernest Andrade, the manager of the program, understands that economic development today is about making and nurturing relationships, not water and sewer. Here is a short excerpt from Andrade's article that summarizes where economic development should be focused today:
"Three key pieces of statistical data reinforce an argument that communities should spend more of their economic development resources on business formation. First, approximately 80% of all job creation occurs from within the community; second, a majority of the businesses being formed today have five or fewer employees; and third, there is an inverse relationship between high wage, knowledge-based companies and their physical space requirements."
It is the last item that is particularly worthy of careful analysis: high wage knowledge companies don't need a lot of real estate. They don't need vast tracts of empty land. They often don't even want to be in business parks. They often want to be in rehabbed downtown lofts, close to other small businesses, and close to good restaurants, where the deals are so often made. They want to be close to good coffee shops so they can meet casually with co-workers and clients. They want to be near vibrant and active downtown areas.
Charleston is a shining example of what is possible in community revitalization, and if you have never visited the city, it would be worth it to pack up all your economic developers and spend a couple of days there. Give Andrade a call and talk to him while you are there.
I was fortunate enough to have dinner the other night with a very gifted and smart county administrator, who told me this:
"Our job is to attract talent to our region, not businesses. If we have talented people, we can do anything. And to attract talented people, we have to have the amenities that they want and expect, like broadband."
I think he has it exactly right. In the Knowledge Economy, businesses are becoming more and more portable and less and less reliant on traditional infrastructure like water and sewer. It does not mean that infrastructure is now irrelevant or unimportant, but it does mean that we have to think about it in different ways.
I was at a major top tier college recently, and they told me they had a hiring crisis. New faculty were turning down well paying jobs at this prestigious school. Why do you think? It was because broadband was unavailable outside the "downtown" area of this otherwise rural community. Many faculty wanted to live outside town where they could own a few acres of land and really enjoy country living, but broadband was no longer a nice luxury, it was now a life necessity. These prospective faculty were telling the college they simply would not live in a community without broadband.
In other words, these talented people were not attracted to this community because of the lack of broadband in residential areas, not business parks. So you have to have affordable broadband options in your business and industrial parks, but you also have to have it everywhere else if you want to attract talented people to your region.
Michael Copps, an FCC commissioner and consumer advocate, had an op-ed piece in the Washington Post last week. Copps says American broadband is too slow and too costly, and that it is going to cripple our economy and our ability to compete in the global economy. I could not agree more.
Copps goes on to say that universal, affordable broadband access would be a major driver of economic development, with the ability to add more than a million jobs to the economy. Lack of affordable broadband is limiting the ability of many businesses to expand into new markets and to just manage the enterprise efficiently. Copps endorses a public/private approach. In most areas of the country, I think the initiative to get this done has to come from local and regional governments, rather than from state initiatives. Neither state nor Federal governments have neither the will to help nor the energy to try new approaches. Communities and regions are on their own, and your community, without affordable broadband available, may not survive economically.
NetworkWorld reports that spam traffic has jumped substantially in the past month or two. Fueling the deluge of junk mail are two changes in the spam ecosphere. Spammers are using two new zombie programs that infect Windows computers, making ordinary desktop computers into spam machines that can send out hundreds of thousands of spam emails per day. Often, people don't even know their machine has been infected; the only hint that something may be wrong is sluggish performance.
The second thing driving the new levels of spam is "image spam," which replaces text with GIF and JPEG images. Very few junk mail filters are able to detect that an email with just an image in it is spam, so spammers are both sending out more of that kind of spam, but we are seeing more of it in our IN boxes because our email filters and firewalls can't detect it. There is some work being done to use image processing software to identify and detect image spam, but it will take some time to get the software working well enough to deploy.
Ultimately, I see no solution other than to charge a fee for email. The problem with spam is that there is virtually no cost to send it. In essence, the cost of delivery is paid by the receiver, rather than the sender. If we had a micropayment system in place where it cost, for example, 1/100th of a cent to send a piece of email, it would cost most people and businesses almost nothing, but spammers sending millions of emails per day could no longer afford to do it.
Commercial airliners are about to become the biggest and most expensive iPod accessory yet. Several airlines are going to provide integrated iPod docks for both charging your iPod and for accessing content. Newer airplanes with LCD panels built into the seat backs will be able to display video content from your iPod.
So before you leave, you load up your iPod with a couple of movies you have wanted to watch. Once you are on the plane, you plug your iPod into a dock on your seat arm, and presto, you can watch your own movies on your seat back screen. Pretty cool.
For some time, I have been telling communities that quality of life and affordable broadband are the drivers of economic development in rural areas of the country. But over the past few months, I have come to believe that there is a third factor: reliable electric power. As we store more and more data and dish more of that data out to a global audience via our Web sites and businesses, reliable electric power is a critical resource that is needed to keep electricity-hungry servers humming.
How important is it? Wired reports that Google is building a new office campus and data center next to a hydroelectric dam. It turns out that not only do communities need redundant fiber connections to the Internet. They also need redundant power connections into business parks and business districts, to minimize power outages. A company like Amazon is doing millions of dollars of business PER HOUR, and just a few minutes of losing connectivity to the Internet or to electric power is disastrous.
Regions served by public electric utilities or by electric coops are well-positioned to take advantage of the new interest in rural areas by high tech companies, because those utilities are more flexible and can more easily make investments that benefit the community.
Finally, safety and security are also driving the shift to placing these in rural areas. In the aftermath of 9/11 and Katrina, companies are realizing decentralized operations are a business necessity. And the low cost of land, lower wages, less traffic, and the beautiful countryside helps too. Rural communities, start your power generators for the coming boom of the Energy Economy.
The 2006 elections seemed to have passed without major problems with the electronic voting machines, but here is the problem: We'll never know. Because these machines could be tampered with invisibly, there is simply no way to know if they were or not, because there is no audit trail. We simply have no way to check to see if vote counts were altered. We may have dodged a bullet this time, but these machines are problematic, and a threat to our country.
In a victory for personal privacy, a German court has ruled that if a customer requests it, an Internet Service Provider (ISP) must delete the IP log data that shows what a customer has been doing on the Internet and when. In the U.S., unfortunately, we are headed in the other direction, with the Federal government anxious to make ISPs responsible for retaining such information--forever! It is a huge and costly burden, with little justification, since most of us will never commit a crime that might require such data, and in my opinion, it is intrusive and an invasion of privacy.
The Boston airport administration has tried for two years to force out every WiFi provider in the airport except the one with whom they signed a contract. This meant that travelers did not have a choice of providers, and that free WiFi in airline frequent traveler lounges had to be removed by the airlines. Logan Airport officials claimed the WiFi providers were causing radio interference with airport operations, thereby endangering safety. Right. Unlike the thousands of cellphones crowding the very same airwaves.
The FCC finally got into the act and told the airport officials to knock it off. Good for the FCC. In this case, they came down squarely on the side of citizens and the free market, and that's always the right thing to do.
According to Kevin Maney, in USA Today (page 3B), Walmart is shocked--shocked--that downloads of movies from the iTunes store are being sold for less money than the old-fashioned DVDs that use enormous energy to make and transport. Walmart is upset that they might be losing sales to digital downloads, and they apparently want someone to do something about it.
In this case, the giant retailer is apparently pressuring the Hollywood content owners that license the movies for sale to force Apple and other online retailers to keep prices artificially high. This is the part that baffles me. Hardly a week goes buy that we don't see some article about some business being disrupted by the Internet. However, too often these businesses are demanding special protection against the big bad Internet. Somewhere along the way, too many American businesses have acquired the bizarre notion that government and/or consumers owe them something--that something being the inalienable right to sell something nobody wants anymore.
In the case of movies, no one wants to get in their car and fight the traffic in the Walmart parking lot and the long lines at the checkouts to buy a $12 movie. Not if they have broadband and can download it from the 'net.
We are seeing the same strange thinking from the big telecom companies, whose entire business model is slowly but surely going to be stripped from them in the coming decade as we move to community-managed digital road systems that lower telecom prices and provide a lot more choice. But some telcos think they have somehow acquired a natural right to a monopoly on telecom, and that it is the government's job to force everyone to pay more for poor service.
These companies have only two choices in the real world: adapt to changing markets or go out of business. In their bizarro world where everything is backwards, they apparently think they can stay the same forever. I don't think so. Too much money is at stake, and as businesses, government, and citizens figure out better ways to buy stuff like music and videos, these companies will have to leave bizarro world and join the rest of us.