Technology Futures

Chicago area small businesses are hurt by the lack of broadband. But that is a story that applies to small businesses everywhere in the U.S., but rural businesses suffer the most.

In rural areas, the longer distances make it more difficult for incumbent phone companies to justify the investment, but the need is still there. I was at a county council meeting last week in a community working to develop a broadband master plan for the county, and the incumbent phone company used the same tired arguments against the community effort.

The phone company representative said that it was too expensive to do. This is patent nonsense. It may be more expensive, but it is not "too expensive." We need only look at the existing telephone and electric lines to virtually every rural home and business in the country--mostly provided by well-run and profitable coop ventures. Common sense alone suggests that if we have already run two cables to rural homes and businesses, we can certainly do so again.

What we need are honest phone and cable companies that are willing to say, "Okay, we understand the market has changed. We'll work with any local community that builds an open access infrastructure. This will lower our costs and expand our potential market. And we understand we will have to compete."

That would be honest and forthright, and companies that would embrace an open access communitywide network would, I am convinced, make more money than they are now. Why? Because they would have access to more customers at lower cost, and could offer a wider variety of advanced services.

But it requires corporate honesty first to prosper in that kind of environment. In the meantime, communities and community leaders can't just sit by and watch their local businesses wither away because basic infrastructure is missing. If it were 1960, we have the equivalent, in many communities, of leaders who are saying good water and sewer is not important because the outhouse still works just fine.

Local businesses need affordable high speed broadband to compete in the global Knowledge Economy. And they can't wait forever. What are your leaders and economic developers doing to remedy the situation?

A new study confirms what most people already know intuitively, but it is always nice to have data to back it up: Most people stop looking at search results at page three, and many expect to find what they want on page one.

It is an issue for businesses, but also for communities and economic developers. With most relocation research starting on the Web, if your community is not getting relevant community site links on the first page of most search engines, it is telling relocation consultants you are not "connected." And your community is probably not even getting on the short list for consideration. Worse, you won't even know, because no one is calling the economic development office at this stage of relocation search.

It also underscores the importance of a broad, communitywide cooperative effort among local Web sites. Without a comprehensive and collaborative effort, few of your community sites--government, economic development, tourism, civic--will show up on page one of search results.

Unfortunately, I still see many communities managing (or not managing) community Web sites as private fiefdoms that get little time, attention, or resources. And at the same time, the community is wondering why so few businesses are taking a serious look at their town or region.

Design Nine has been helping communities design Web strategies longer than any other company on the planet (we started designing community portals in 1993). Call us if you want to get your community on page one.

The state of Kentucky is beginning to get the hang of a 21st century Knowledge Economy economic development strategy. From this article[link no longer available] (hat tip to EDPro), here is Kris Kimel, president of the Kentucky Science & Technology Corp:

"We are not going to recruit ourselves to prosperity in this state," Kimel said. "That's a piece of it ... but by and large, because of the shift in this knowledge economy, our economy's going to be driven in the future ... by how good a job we do at creating the kinds of knowledge and entrepreneurs that can grow those companies."

Notice Kimel's emphasis on knowledge creation and entrepreneurs as part of an overall economic development effort. That is where many of the new jobs are coming from, not from traditional industrial recruitment. The article goes on to note that the state can no longer recruit primarily based on lower cost (e.g. lower wages, lower cost of utilities, lower cost of land). Why not? Well, if you want low cost for your factory, you will take it to Asia, not to Kentucky, or any other state in the U.S., for that matter.

It is a whole new ballgame in economic development, and an effective regional ED strategy should be developed using a clean sheet of paper and expert advice. One of the biggest problems I see? It's the boards that guide ED groups; too often, the board is comfortable with a Manufacturing Economy approach that produces lackluster results. Who is on your local ED board? Are entrepreneurs and Knowledge Economy businesspeople well represented, or does the board make up look pretty much like it did in 1983--the last year that industrial recruitment was effective as a primary strategy?

South Korea continues to be far more visionary than the United States when thinking about broadband and how it should be used. The city of Seoul, South Korea's largest city, has committed $830 million to the u-Seoul project. The 'u' stands for 'ubiquitious.'

The money will be used for a variety of projects, including high speed connections to all schools, government offices, and health facilities; high speed broadband for entertainment, culture, and sports facilities; and for public transportation and environmental monitoring.

While the Koreans are putting substantial investments into technology that will transform their economy, we are still debating whether broadband should be 200 kilobits/second (the FCC definition) or if we should jump things up to the 1-2 megabits/second favored by the telephone and cable companies (which is about 1% of South Korea's broadband target).