Ranked #5: Availability of High-Speed Internet Access

Over the two-decade history of Area Development's survey, "availability of high-speed Internet access" has risen from a nonexistent factor to one of the top five criteria for companies seeking a new location. Although fairly good basic access (something better than dial-up) has become widespread and is now sometimes considered a given, it is quickly becoming inadequate for many business facilities. Availability of still better connectivity is an important need of many expanding companies and can be a significant asset for communities seeking to recruit communications-intensive business operations.

The Need for Speed
The business reasons for faster Internet access are evident and apply across a wide range of economic sectors:

• Business facilities that handle large volumes of data as a core activity include those in finance, business management/performance monitoring, software and multimedia development, sales/marketing, consulting, and numerous other fields. It is often desirable for these activities to be carried out in relatively small standalone facilities as opposed to major corporate offices with thousands of PCs hardwired into a local area network. Independent offices can be more cost-effective, offer a more cordial and individualized work environment, and provide redundancy and security by not putting all of a company's eggs into one basket. This is possible only when fast, high-quality telecommunications connectivity is assured.
• Internet-based monitoring, control, and maintenance of business and industrial systems and equipment are rapidly growing applications. Software control of equipment has been in place a long time and is logically extended to remote control via the Internet. Modern factories and distribution centers must have digital links to others in their supply chain - vendors and suppliers on the upstream side, transportation companies and customers on the downstream side. Many retailers count on point-of-sale systems to provide real-time data on turnover and make virtually instantaneous adjustments to their ordering.
• Availability of truly high-quality video teleconferencing, integrated with media and data presentation capabilities, would certainly expand the use by many companies of this very valuable technology. In the past, some such systems have been clunky and not very user-friendly, and have not supplemented face-to-face meetings as fast as might be expected. The costs and inconveniences of travel add urgency to more widespread use of video conferencing.
• Business use of the Internet for basic daily communication such as e-mail can be greatly improved. Companies must make their contact information widely available as part of their sales, marketing, and customer service strategy; but this also exposes their staffs to barrages of unsolicited e-mail. According to the Washington State Attorney General's Office, almost 45 percent of all e-mail is spam - nearly three trillion such messages are sent each year. Thousands of unsolicited and often malicious e-mails arrive on the average U.S. computer each year even after existing filtering technology eliminates 80-90 percent of junk messages. Spam costs legitimate U.S. businesses $9 billion annually. Regulations have been put in place, but scammers often are ahead of the laws; and since much nasty stuff originates in countries where regulations are weak or poorly enforced, there is not much hope for improving the problem that way. More comprehensive and sophisticated screening and prioritizing of incoming e-mail, better security that is also less intrusive and time-consuming, and other such needs beg for a technology-based solution. In turn, that requires better connectivity. According to Atlanta-based computer consultant Richard Bodor, hardware and software systems are already available to address these issues; the weak link is connectivity.

Good But Not Good Enough
Improvements in Internet access across North America have been impressive. The Digital Subscriber Line (DSL) system has been the most prevalent upgraded service. Certainly it was a big improvement over dial-up, leading to data transfer speeds potentially hundreds of times faster, and providing other advantages over dial-up. However, the various types of DSL services are basically a clever way of intensifying use of the existing copper wire telephone line infrastructure. That's great, but repaving and increasing the legal speed limit on a curvy two-lane highway is still not the same as building a new expressway.

Even DSL is not universally available, and there are big differences in the types and quality of DSL, depending on the customer's location and the sophistication of the local telephone infrastructure. Much is asymmetric (ADSL), which means that the speed at which the user's computer uploads data to the central office of the Internet service provider is much slower than the speed at which the remote computer can download data. That fits well with the common scenario of one user uploading modest-sized signals to navigate the Internet and receiving back large packages of information from a remote server. However, for businesses where it is important to exchange data rapidly in both directions, ADSL is a compromise.

There are several varieties of connection technologies considered superior to traditional telephone lines. They are available in many locations, if a company is willing to pay for satellite, microwave, special cable connections, or other such services to its facility. They can be extremely expensive, however, if the company has to install everything on its own.

State and Local Preparedness
Some thoughtful state and local organizations have recognized the value of universally available high-speed Internet access as an important element of preparedness for economic development. Just as good roads boost the economy of a region previously without good access, the availability of better and faster connectivity is likely to bring more economic development to a geographic area. Some examples follow:

• The Virginia Tobacco Commission is using tobacco settlement funds to construct a fiberoptic backbone across its once-prosperous region that has since lost tobacco revenue as well as much of its traditional furniture and textile industry. The availability of heavy-duty optical cable telecommunications service is expected to open the area to a wide variety of new business activity.
• The publicly owned Pulaski Electric System in Tennessee is installing a fiberoptic network that will provide very high-speed Internet access and other telecom services to every business and home in the city, and eventually to the surrounding area as well. The original issue was development of fiber optics as a monitoring and control technology for certain electric distribution activities. Local leadership realized that this basic infrastructure could be leveraged to expand availability of top-quality Internet access to everyone.
• A West Coast city with some unique public safety issues developed a wireless digital telecommunications system providing high-speed mobile connectivity for police and fire vehicles. Clearly if such a system were to be relied upon by police officers and firefighters, it would have to be very robust and provide trustworthy mobile connectivity throughout the community. It became evident that, with some additional investment, this connectivity could be made available to citizens at large.

These examples are noteworthy because they represent bold, forward-looking actions by communities aware of how high-speed Internet access can provide many economic development and other benefits.