Reshoring

    Rural Broadband Necessary for Rural Innovation

    broadbandplugTuesday– September 23, 2014

    It’s nice to see that people are recognizing that innovation isn’t always in Silicon Valley. Writing you today from the countryside in Three Oaks, Michigan, aka “Michiana” — where my poky web access is satellite based.

    Steve Case’s article earlier this week in the Washington Post  – Why innovation and start-ups are thriving in ‘flyover’ country –  is spot on. Case, you may recall, was co-founder of AOL. He correctly identifies the reasons why Chicago, Denver, Cincinnati, and other smaller cities are becoming vibrant centers of start-ups. He’s asking for investments of time and money to be made in order to further the trend. I agree, and…

    He didn’t go far enough with his article — he missed one key factor in developing a wide distribution of start-ups and entrepreneurial companies in the USA (and this hold true for other large countries). What he missed is a Lack of Rural Technology Infrastructure. The National Broadband Plan, articulated as part of the USA economic stimulus, has never been implemented. Like many good ideas it’s been politicized, and so, South Korean children have better web access at schools than Americans. Even if the National Broadband Plan was fully implemented, it leaves out a lot of rural people, it’s not Universal Access for Americans.

    Case cites “advancements in technology” as one reason flyover areas are having, and will have more, start-ups. Well, yes, but it’s not a given they’ll get access to that technology. Case assumes that what’s common even in small cities is actually universal. It’s not universal. Rural areas have been neglected by both commercial companies and the government. There are a few exceptions, with entrepreneurs trying to close the gap (like aXess America — recently purchased by larger player Mercury Wireless). But infrastructure of any kind is expensive and small telco’s simply don’t have the cash to invest.

    This is one of those national issues in the USA that screams for across aisle cooperation, creative problem solving, and compromise for the common good. Universal access to broadband ought to be a national goal.

    I ask any rural American voter this question: Who’s working to get you, your family, and your community the broadband access you’re going to need in the future? Vote accordingly, vote in your interest. Your schools, your healthcare, your farm, the small businesses that dot the countryside, and, the businesses that need to be invented in your communities — all need broadband to prosper.

    Why can’t this problem become an opportunity? Why not incentivize private companies to invest in rural technology infrastructure? I don’t want this to be a government service, but any port in the storm. Wasn’t this done years ago to bring electricity to every home in America? Isn’t this part of what made us, for a long time, the most modern country in the world? This challenge was addressed by Congress in 1936 as part of the New Deal and it worked both as a lifestyle improvement and also as stimulus for the economy. Why can’t we do the modern equivalent now? Why would the USA not lead the world in web access? We don’t by the way, not even close. The UK, Canada, France, Sweden, Australia — and 23 more countries — all beat the USA for percentage of web penetration. We’re second to the Chinese in total numbers, but the USA is #28 in availability. Sad statistic, particularly if we want to encourage start-ups in the countryside.

    Nearly every start-up, particularly in remote areas, let alone small cities, relies on fast web access. In a lot of rural places — large geographic areas — fast access is woefully bad. People resort to using cellular phones to do email and web browsing. Or driving 20 minutes to a town to use the library or a a restaurants Wifi. The wonderful world of Netflix — fagedaboutit.

    It’s assumed (by many who live in cities) that everybody who is willing to pay can get fast web access. Not so, there are plenty of places in this country that have no decent option for fast access. Rural areas these days are lucky to get a digital phone line, let alone web access, as the days of Ma Bell taking care of everyone are long over. Rural folks have a solution for television (services like Dish Network) but satellite web access is expensive and slow (AT&T’s Wild Blue/Excede). Wild Blue/Excede limits downloads and has severe penalties for going over the limit (they’ll cut you off).

    Of course, big companies like AT&T and Comcast could care less about areas with low population densities. Comcast won’t put a cable down your road if there aren’t at least 20 paying customers per mile (that’s my guess). AT&T is avoiding upgrading POTS service in rural areas because it’s expensive and it’s a long term payoff. Local governments are smart enough to insist on getting cable access in the village, but they often neglect the farmers just one mile out of town. Often the cable company is required by franchise agreements to put lines in remote areas — but are allowed to get away without doing so.

    Can I remind you that advanced things get invented in rural America?

    Philo Farnsworth, son of an Idaho potato farmer, came up with the key invention that enabled television — the video camera tube. There is enormous entrepreneurial opportunity out in the sticks, not just because of the talent, but the abundant natural resources. As we rethink energy and food production, and as recycling becomes a way of life, I can tell you that the innovative solutions we seek involve rural assets and people.

    So, this is a simple appeal to both business and to government. Invest in rural technology infrastructure, first and foremost, broadband access. It will pay off in both the short and long run in more start-ups and job generating innovation out where the air is fresh.

    On a local and personal note — Hey Fred Upton — so how about doing something for us out in the rural areas of Berrien county! Michiana needs better broadband. Why aren’t you working to get the National Broadband Plan, flawed as it is, implemented? I wonder if candidate Paul Clements would take up this issue if he got elected?

     

     

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    Support RAMI

    We Can’t Get Serious About Manufacturing Soon Enough. I support RAMI. I read with interest a post on the congressional blog The Hill. In a rare example of cross party cooperation it would appear that the Senate is taking action on supporting growth in our manufacturing sector. Do read the piece but in essence the idea is to set up a national network for manufacturing innovation. This would build on the pilot center/hubs for innovation already set up by the Obama administration. Kudos to Senators Sherrod Brown (D-Ohio) and Roy Blunt (R-Missouri). I like your style gentlemen — first for working in a true bipartisan manner, and secondly for doing it on something so important. The bill is called Revitalize American Manufacturing and Innovation Act (RAMI). Congressman Tom Reed (R-New York) and

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    A New Idea for Black Friday

    The concept of Black Friday has me thinking about what we reward as consumers. My idea of shopping has nothing to do with sharp elbows, crowds, or even bargains. The kind of shopping I like is when I find something truly unique, really special and creative or innovative, at a small shop or family business. Best for me if it’s made in America, and of high quality craftsmanship, to me, this is real value — and I’ll buy that, I’ll reward that. That kind of shopping is increasingly hard to do. As I watched CNN this morning I was a bit amazed by all the “news” around the concept of Black Friday. Man-on-the-spot interviews at shopping malls, traffic reports from WalMart,

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    The Innovation State of the Union

    President Obama made mention in his state of the union address that he wishes to expand the National Netowrk for Manufacturing Innovation concept. I wholly applaud the idea, AND, there might be a more fundamental challenge that needs addressed first. I’ve made the acquaintance of a thought leader with her finger on the pulse of where the nation sits in terms of technological readiness to innovate. Her name is Pamela Menges, and she’s President of a high-tech start up in Cincinnati. She’s also a professor at the University of Cincinnati in their Engineering department. Steve Jobs once challenged Obama to find him 30,000 engineers so he could build a plant in California. That challenge remains a big one, and again,

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    Detroit Soup — Serving Hope & Innovation

    As a Michigander I’m always looking for some good vibes on the economy. I found it last night on NBC Nightly News, an inspirational story about Detroit Soup.  It’s not a restaurant, but it does serve soup — and something a lot more precious for down-on-its-luck-Motown — hope. Here’s the concept: Detroit Soup is a monthly dinner to fund creative and entrepreneurial projects. Micro grants are awarded at the dinner. Five dollars ($5.00) is the entry fee and it gets you a simple meal — soup, salad, bread — and a vote. They hold the dinner in an old warehouse. Click over to their site and read their backstory, it’s interesting. Apparently this concept has been happening for over three years.

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    Reshoring – Why It Makes Sense

    It’s a shame that the reshoring trend (of manufacturing back to the USA) will take years to be realized. I’m a fan of course, I’ve written about it here before. Like many trends, it’s emerging in dribs and drabs; and some dispute it’s even really happening. I know from personal experience how difficult it is to raise funds for new manufacturing ventures in the USA. It’s a sad truth today that VC’s are more interested in funding the next iPhone app than a start-up that actually makes something. It’s also not good that the most likely candidates for reshoring — high tech equipment intensive/low labour requirement operations — are very expensive to set up. The business case can be hard

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    How Reshoring Happens

    Briefly noted: The New York Times ran an article this morning about how Starbucks is moving manufacture of pottery mugs to a small shop in East Liverpool, Ohio. This is notable because it’s another example of “reshoring” — that is, bringing manufacturing from China and other cheap (aka slave) labor markets back to the USA. This is how restoring the economy happens, one job at a time. Kudos to Starbucks for being a good corporate citizen, and doing something that is just plain smart as well. Sales from the mugs will help support Starbuck’s Create Jobs for USA Fund. I’ve blogged about both reshoring and the Create Jobs for USA program here before — nice to see it’s an active

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