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Economic Development Goals for 2011

Local governments are now eagerly discussing how to utilize information and communications technology (ICT) investment to advance their economic development plans. Topic awareness has increased, and yet total  comprehension and plan execution is still a work in progress. Regardless, we’ve seen notable progress.

Back in 1997 I managed the public sector account teams for US West in the state of Arizona. It was my responsibility to understand and support the ICT needs and wants of our local government, education and public safety customers.

I was invited to attend a meeting where US West would request local council member support for a pilot of the first triple-play service offering in America. The company’s formal presentation focused on the digital TV aspects of the service. Frankly, the outcome was disappointing — there were lots of concerns from both elected and appointed city officials. The first pilot project stalled.

The Mayor and council members seemed indifferent at the prospect of “the phone company” entering the local pay-TV arena. It wasn’t that they didn’t appreciate new pay-TV competition in their market, but that it just wasn’t a pressing issue for the council to consider.

Applying a Proven Catalyst of Job Growth

Meanwhile, as I developed US West’s “Connecting Arizona” objectives, I found myself repeating the same fundamental context for our cause — “it’s about the interdependent relationship between telecommunications infrastructure investment, and sustainable community economic development.” That’s a mouthful. Therefore, I coined the term Economic TeleDevelopment to provide an identity to this phenomenon.

At the time, it was very useful to have a unique descriptive term that helped us re-state our intent for the launch of these VDSL-based triple-play offerings. We revisited the local city councils, and I presented our new focal point — delivering broadband access to the home’s of existing and budding SOHO businesses.

Tailored to the Phoenix, Arizona suburbs, this revised request was more compelling to local government leadership, “encourage US West to pilot new technology and infrastructure that will give your local home-based business owners a competitive edge.” It worked — the triple-play pilot projects were unanimously approved.

Furthermore, we were asked by community leaders to work more closely with their local economic development practitioners, and thereby explain how to fully leverage these new broadband assets. So, what’s changed during the last decade?

The Real Deal, from the Front Lines of America

Overall, the roles have somewhat reversed; local community demand is now driving this dialogue. Here’s a case in point. A recent U.S. market study and resulting report by Successful.com entitled “Broadband’s Impact on Economic Development: The Real Deal” profiles the evolving environment.

I believe the following points from the report are particularly noteworthy.

“There appears to be strong belief that broadband can improve local economies at the individual constituent level. 52% of respondents believe the technology can help harness home-based businesses into a strong economic development force, and 43% feel broadband can be used to influence underserved individuals to become entrepreneurs.

Support for some federal government goals is weak. Over 90% of those surveyed found government-recommended goals of 4 Mbps for rural areas inadequate for impacting economic development outcomes. Over 55% believe speeds of 100 Mbps (the FCC’s goal for 100 million mostly urban and suburban households) or more are needed, but within three years, not 10 as some Federal agencies support.”

Survey respondents were a representative cross-section of key stakeholders — 29% represent cities and towns, another 23% serve counties and 21% work for a region within their state. Almost 9% have responsibilities that cover the entire United States.

Respondents were encouraged to shared their current outlook. Perhaps this comment sums up the market reality, “Broadband is a necessity in our world today. Having it available to all communities — no matter how fast/slow — is an economic boost. The global economy isn’t stopping to allow those communities who don’t have broadband to catch up, they are running ahead and not looking back.” Enough said.

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6 Comments.


  1. Before going for its goals in 2011, we should know what Economic Development is. Economic development is the progress in living standards. The first goal in 2011 should be a nation that is supportive of balanced economic growth and development along with high wage jobs; diverse incentives; good connections to other regions.

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    • David Deans

      Tamara, understood. Given the track record of U.S. new job creation over the last couple of decades, arming small business owners with affordable and globally competitive broadband services would likely be a very positive step in the right direction. Some might argue, given the current level of unemployment in America, all new jobs are a welcomed sign of progress.

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  2. Yes, the goal of economic development should be raising living standards and building a sustainable economic model, but too often it is about real estate deals and land development. Small business and the independent work force (1099s) do not benefit from most EcoDev programs.

    The “success” metrics for most economic development organizations is a vague measure called jobs and since most ecodev is about relocation, these are not new jobs. Resources and policy need to support the creation of new companies and products, not tax incentives and permitting short cuts to win the attention of relocation consultants.

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    • David Deans

      @StartupMonkey, point taken. I’ve previously witnessed the apparent disconnect between the local tax incentives that you mention and the intended outcomes. Case in point, in Arizona most of the prior efforts to leverage telecom infrastructure were applied to lure Call Centers to the state. Clearly, these typically low-paying jobs have now, in many cases, been moved to other parts of the world — little sustainable value was therefore gained from those efforts.

      That said, perhaps we’ll see more forward-looking programs that are focused on the existing talent pool of local entrepreneurs that are more likely to deliver a lasting economic impact. Of course, developing those small businesses requires a significant public/private institution commitment. FYI, in the case of Arizona, they also had a very active community of start-up venture support groups.

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  3. Grass roots community support is the key to building an environment that supports company creation and what Kauffman refers to as high-growth potential startups. Typically local policies and programs to support job creation at the low end (<50 employees) lump all small companies into one bucket and while training classes on QuickBooks, SBA loans and business plan writing are great for opening a lawn mower repair business, they have little value to a tech startup founder who is trying to ship a product.

    Many of the new venture support efforts that have spun out of the local chamber and tech networking-type crowd have unfortunately focused more on the Venture and less on founder. Grandiose programs on how to attract and pitch VC’s (and the snake oil salesmen who promise introductions) have overshadowed the more critical skills of how to bootstrap, launch, rinse and repeat. There’s nothing worse than listening to a spokesman for the Chamber or local politician spout off about wanting to be the next Silicon Valley or the home to the next Google / Facebook and then pointing to the research funding they just secured for the local university.

    This is one of the reasons we jumped on the Coworking band wagon and opened @IdeaField here in Tampa Bay. The crowd we attract are techies and freelancers who appreciate and feed off of the opportunity to collaborate with like minds. These are the folks that are most likely to start a new high-growth company or at least be the fuel / workforce behind the next new startup. I don’t believe that local gov’t would be successful at running a program like this, but they do need to open their minds and policies to accommodate and promote this type of grass roots innovation and job creation as one of their community strengths. As you pointed out, tax incentives and sweet land deals only attract mediocre jobs and companies with short attention spans. While companies that start from grass roots community collaboration generally stay where they start and in best case scenarios, spin off smart people and new ventures that create even more wealth and economic stability.

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    • David Deans

      @StartupMonkey, thank you, once again, for taking the time to share your thoughtful insights with us. In an upcoming post, I’ll be outlining some stories about other examples of grass roots activities, from around the world. BTW, I just visited your @IdeaField website. Kudos to you and your peer group in Tampa Bay — I appreciate that sometimes a do-it-yourself approach is exactly what’s needed to gain initial momentum.

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