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Area Development - Site Selection, Facility Planning and Workforce Development

Information and Communications Technologies: Taking It to the Country

Rural communities are leveraging advanced information and communications technologies to compete with major metropolitan areas for new investment.

Apr/May 09
No longer an advanced technology only required for cutting-edge businesses, reliable high-capacity broadband is a must for many of today's business operations. Whether it is an auto plant in Detroit, a data center in Idaho, or a customer service call center in Virginia, few sites can do without it and it is now expected in many site selection decisions.

While much of rural America's information and communications technology (ICT) infrastructure still lags behind that of major metropolitan areas, some small communities are taking important steps to bring their infrastructure up to speed. By building community support, laying fiber optic lines through the countryside, and creating multiple levels of redundancy, administrators in these rural areas show their understanding that broadband infrastructure is now as critical as highways and an educated work force. Advanced ICT services are not just needed to thrive - they will soon be needed simply to survive.

With funding from the American Recovery and Reinvestment Act of 2009 planned for rural broadband development, those in the ICT industries say that less populated communities have a stronger chance than ever before to build out their ICT infrastructure. By combining a high-capacity broadband infrastructure with the low costs traditionally associated with business location in rural areas, these communities have opportunities to present a highly attractive option for corporate location decision-makers.

Critical to Success
Although the availability of advanced ICT services was ranked fairly low on Area Development's 2008 Corporate Survey of site selection factors, it is still critical to operations. A U.S. Census Bureau study says that U.S. businesses spent more than $250.7 billion on ICT equipment in 2006. In today's digital age, every aspect of a company's operations - from shipping and receiving to manufacturing and customer service - relies on a web-based infrastructure that can support the flow of information across a vast network of centers and business partners.

Ed McCallum, a senior principal at McCallum Sweeney Consulting, Inc., which provides site selection and negotiation services for manufacturing firms, says that in the past 15 years, a large amount of fiber has been put in the ground throughout much of the country. The availability of advanced ICT services isn't less important, it is just that it is expected. "Fiber is just about everywhere now and you have to be in a very remote area not to have it," he says. "What was considered `rural' in the past now may not be so rural anymore."

One area that has invested heavily in telecom infrastructure - including fiber optics and digital switching - is Platte County, Missouri. This has ensured high-quality, reliable service. Major information-intensive businesses located in Platte County include Aetna RX Services, as well as data centers for Bank of America, Liberty Mutual Insurance, MasterCard, and CitiCards, among others.

Gary Yates, director of site selection for Jones Lang LaSalle Americas, Inc., says that much of the country is already "wired" to some capacity, but many rural areas lack redundant and robust systems. Redundancy involves having multiple fail-safes in place so that if a network wire is damaged, there is still a path for information to flow. Redundant systems often have fiber optic wires run in a loop fashion throughout an area and even the entire community so that a fail point doesn't cut off service to those down the line. Yates says it is not uncommon to find rural sites with only one line. "In some of these [smaller] markets, you can get fiber optics, but it is a direct line from the central office versus a loop," he says. "If a backhoe is digging down the street and hits the wire, you are out."

Many companies are also moving to more paperless environments where documents are scanned and transported via e-mail and the Internet. The biggest data operations require broadband access with large bandwidth typically handled by the benchmark T3 lines and circuits. Also known as DS3, it's a super high-speed connection that is equal to 672 regular voice-grade telephone lines and can transmit data at rates of up to 45 megabytes per second. T3 lines can transmit real-time video and very large databases over a busy network shared by hundreds or thousands of users.

Whether it is serving the needs of a small manufacturing operation or having the major power and broadband redundancy needed for a large data center, rural communities are all developing their ICT infrastructure on different levels. Jan Rogers, executive director of the Southern Idaho Economic Development Organization, says that a regional assessment by Lockwood Greene found a lack of fiber optic communications to be a major barrier in her area. In September 2000, 12 rural telephone companies in the region came together and created Syringa Networks with the mission to build a $40 million broadband infrastructure network through even the most sparsely populated and rural areas of southern Idaho. Most of the communities in the network have fewer than 10,000 residents, but Syringa can still deliver T1 to T3 speeds through its Frame Relay Service. "Without [the infrastructure], a number of manufacturers that are in our area would not have been able to come here because we wouldn't have been able to provide the services," says Rogers. "Our opportunities have grown spectacularly from where they were 10 years ago."

In Missouri, the Joplin area has a fiber-optic network strong enough to support a regional labor market of 195,000 and a population within 150 miles higher than that of metropolitan areas such as Kansas City and Tulsa. The ICT?network supports businesses that include several software development companies and tech support centers. Local colleges and private technical schools offer training programs for all skill levels in ICT.

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