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Area Development - Site Selection, Facility Planning and Workforce Development

Ranked #5: Availability of High-Speed Internet Access

Just a few years ago, AVAILABILITY OF HIGH-SPEED INTERNET ACCESS wasn't even one of the site selection factors considered by the respondents to Area Development's Corporate Survey. Now it's ranked fifth.

Jun/Jul 06
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.

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