Tag Archives: economic development

Strip mall or industrial park, broadband drives commercial property values

by Steve Blum • , ,

Even the smallest businesses want fast, reliable and competitively priced broadband now. My barber has 100 Mbps service in his one-man shop so he can run an online business on the side. Dollar stores couldn’t exist without access to a global market for surplus merchandise. Those are just two neighborhood strip mall examples. Every sector of the economy depends on broadband to maintain fast, real time connections to customers, suppliers, partners and data centers.

Broadband access distinguishes one commercial or industrial area from another. The businesses that you’ll find in any particular industrial park, for example, are mostly businesses that have learned to live within the limits of the available bandwidth. The ones that out grew those limits have, for the most part, moved out. Some are surviving by paying for expensive, custom-built connections from major carriers or by kludging together wireless links, but most don’t have the money, time or knowledge to do that.

Clusters of smaller startups and talented freelancers develop where Internet service is cheap and cheerful. And fast. A good example is downtown Santa Cruz. Eleven years ago, it was a ghost town. Then NextSpace opened the first modern co-working facility and Cruzio started pumping bandwidth anywhere that anyone wanted it. Freelancers and shoe string entrepreneurs showed up, then remote offices for Silicon Valley workers followed. Now you have big high tech companies and venture capital-backed startups crowding in. And rents and congestion are going up. So the next stop, 20 miles south, is Watsonville, where enquiries for high speed, industrial grade broadband facilities – again, dark fiber with redundant paths to Tier 1 exchanges – are at an all time high and growing (and being met, in some cases, by the City of Watsonville’s municipal dark fiber network).

Broadband is the primary limiting factor for economic development in California. It used to be that industrial plants located where power was abundant and inexpensive, and railroad connections were close by. Now, it’s all about broadband.

Broadband projects queued up for Monterey startups

by Steve Blum • , , ,

Independent projects are driving broadband infrastructure upgrades on California’s central coast. Maybe not as universally or as quickly as local entrepreneurs would like, but it’s happening. That was my message on Tuesday evening to the the Startup Monterey Bay Tech Meetup in Seaside.

I was asked to give an update on broadband development in the region. Those efforts center on the Central Coast Broadband Consortium (CCBC), an ad hoc group of local companies, agencies and other organisations in Monterey, San Benito and Santa Cruz counties that essentially have one thing in common: an interest in getting better, cheaper and more reliable broadband service in the region. Some of the work it does – primarily analytical and policy work – is funded by a broadband consortia grant from the California Public Utilities Commission.

Most of the region has substandard broadband service, earning a “D” grade or worse on a scale developed for the East Bay Broadband Consortium. More affluent and/or urbanised areas rate average, “C” grades, but in poorer and/or rural areas, consumers and businesses alike often struggle to get service that meets the CPUC’s minimum standard for Internet access: 6 Mbps up and 1.5 Mbps down.

The good news is that change is coming. A 91-mile open access fiber route between Santa Cruz and Soledad is nearing completion. Built and operated by Sunesys, funded by the CPUC and spearheaded by U.C. Santa Cruz, that line will provide low cost, high capacity backhaul to broadband projects along the entire route: municipal systems in Santa Cruz, Watsonville and Salinas, an FTTH system in north Monterey County and, it seems likely, Charter Communications’ CPUC-mandated digital upgrade of redlined, analog-only communities in the Salinas Valley.

Broadband by itself will not produce new ventures or jobs. It’s up to the region’s entrepreneurs, like those who were at Tuesday’s Monterey Bay tech meetup, to build companies on top of that basic infrastructure. But at least there’s now a fighting chance that it’ll be there for them when they need it.

Fiber gems stand out on California’s central coast

by Steve Blum • , , ,

The industrial/commercial broadband Star Rating system developed by Tellus Venture Associates for the Broadband Consortium of the Pacific Coast shows a wide variation in high grade broadband infrastructure across San Luis Obispo, Santa Barbara and Ventura counties.

In the BCPC region, most commercial and industrial census blocks rated 1 Star or less, however there were ample instances of 2 Star, 3 Star and even some 4 Star Ratings. The highest aggregate rating for a city was found in San Luis Obispo, which rated 2 Stars overall. Otherwise, aggregate ratings in incorporated cities in Santa Barbara and San Luis Obispo counties were at a half-Star or less. Ventura County cities rated higher, up to one and a half Stars.

On an aggregate basis, the City of San Luis Obispo’s 2 Star the result of averaging many 3 Star and No-Star areas. The 3 Star areas are served by a gigabit-class FTTP network operated by Digital West. We were able to include it in the assessment because the company provided a sufficiently detailed map of its system.

With two exceptions, aggregate ratings for communities in Santa Barbara County and the rest of SLO County were all No Stars. The Cities of Santa Barbara and Goleta earned Half Star ratings, and probably would have ranked higher if better fiber network map data was available. The information we had about long distance and metropolitan fiber routes in those two cities indicated that if better information about the availability of service on those networks is provided by the companies involved, particularly Crown Castle, then the ratings would go up.

The low average for the remainder of Santa Barbara County disguises several areas of excellence, including 3 Star locations in Carpenteria, Lompoc and Santa Maria, and a significant number of locations in Santa Maria that rated 1 Star or 2 Stars.

In Ventura County, aggregate ratings for cities ranged from No Stars in the City of Ventura to half Stars in Moorpark, Ojai and Simi Valley, to one Star in Oxnard and Port Hueneme, to one and a half Stars in Camarillo and Thousand Oaks. Higher aggregate ratings correlate to the widespread presence of Verizon’s FiOS fiber to the premise infrastructure. Areas served by AT&T did not tend to do as well.

There were several focused areas of excellence, including 3 Star and 4 Star locations in Camarillo, Moorpark, Oxnard, City of Ventura, Simi Valley and Thousand Oaks. The unincorporated Casa Conejo community was rated 2 Star, in aggregate.

Some of the city and county-scale maps showing Star Ratings for the three counties are available in the report and subsequent update we produced for BCPC, and all of them can be downloaded via the links below. An interactive version is in the works, and I’ll have a post here about it as soon as it’s up.

Broadband Analysis and Planning, Broadband Consortium of the Pacific Coast, Final Report, 11 April 2016
Broadband Analysis and Planning Broadband Consortium of the Pacific Coast Update, 30 June 2016
Star Rating maps – San Luis Obispo County
Star Rating maps – Santa Barbara County
Star Rating maps – Ventura County

Star Ratings show where to find high tech, industrial class broadband

by Steve Blum • , , ,

The best place on California’s south central coast – on the whole – to look for commercial or industrial real estate with access to fast, fiber optic broadband service is San Luis Obispo. But there are plenty of other cities in the SLO – Santa Barbara – Ventura county region with pockets of fiber availability that are as good or, in many cases, better.

In the course of a doing a regional broadband assessment for the Broadband Consortium of the Pacific Coast (BCPC), we developed a method for rating the availability of commercial and industrial-class broadband infrastructure. We’ve been using our broadband report card methodology – originally developed for the East Bay Broadband Consortium – to evaluate the primary broadband infrastructure that’s generally available in a city or county. While it’s proven to be an excellent way to gauge the broadband infrastructure that residents and the vast majority of businesses use and the overall condition of incumbent telephone and cable company networks, more detail is needed to assess whether a business district is equipped to attract high tech, bandwidth-intensive companies.

The commercial/industrial Star Rating system looks specifically at areas of a community that are zoned for commercial or industrial purposes, and then uses a point system to rate the broadband infrastructure that’s available, on a census block level.

If an industrial or commercial area has no fiber to the premise available at all and the primary infrastructure fails to get at least an average – “C” – grade, then it’s a No Star location. If the primary infrastructure gets at least a “C” grade or if it meets bare minimum standards – a “D” grade – and some kind of FTTP is available, it’s a 1 Star area. Additional Stars are awarded for faster, gigabit-class service and open access dark fiber, all the way up to 5 Stars.

In the future, we’ll look at including advanced copper technologies in the rating – G.Fast and DOCSIS 3.1 are candidates – but only where the underlying network has been engineered to support it. It’s a given that bolting custom electronics onto available copper lines – even failing, “F” grade facilities – or bonding lines together can produce fast circuits. But the need to resort to such heroic measures is confirmation of poor infrastructure, and not a reason to celebrate.

We did two runs of the analysis, with more city zoning data and a refined methodology the second time around. Results from both runs were consistent and did a good job of highlighting where the kind of broadband infrastructure high tech companies look for is available in the three counties. More on that tomorrow.

Broadband Analysis and Planning, Broadband Consortium of the Pacific Coast, Final Report, 11 April 2016
Broadband Analysis and Planning Broadband Consortium of the Pacific Coast Update, 30 June 2016
Star Rating maps – San Luis Obispo County
Star Rating maps – Santa Barbara County
Star Rating maps – Ventura County

Saving the environment doesn’t have to mean choking off local infrastructure and economic growth

by Steve Blum • , , , , ,

You can protect the coast without littering it with red tape.

To keep Santa Cruz’s tech economy growing, basic infrastructure has to get better. Broadband is a big part of it, but so is housing, transportation and office space. A day long conference in Seaside in January – the kick-off event for the Monterey Bay Economic Partnership – brought business and government leaders together from Monterey, San Benito and Santa Cruz counties to talk about creating the right conditions for an entrepreneurial culture to grow.

Nearly everyone pointed to the limits imposed by ageing or non-existent infrastructure. It’s a primary barrier – you can’t run a high tech company without high capacity broadband access, for example – but it’s also a necessary first step to overcoming other challenges as well. You need educated and motivated people, and expensive homes and jammed roads make the central coast region unattractive to the talent local companies need most.

Infrastructure improvements, though, are delayed and, sometimes, stopped altogether by challenges made under the California Environmental Quality Act (CEQA), often by people with little or no direct involvement in a project.

“CEQA is being abused by every NIMBY and special interest group across the board,” said Chris Thornberg from Beacon Economics, the conference keynote speaker. Fixing it means doing three things, he said.

“I would not allow anyone who’s not involved to use it,” Thornberg said. “Unions should not be allowed to use CEQA” as a tool in negotiations. Second, “overall, we need to make the entire system much clearer and more transparent.”

Finally, it needs to be drawn back a bit in terms of its power to constrain, Thornberg said. “I think CEQA is a little too weighted in terms of protecting the environment, at the cost of economic growth.”

Safeguarding California’s natural wonders and quality of life is important, but it doesn’t take an endless, byzantine and expensive process to do it.

Santa Cruz tech companies need housing to draw talent to attract investment

by Steve Blum • , , , ,

Talent and attitude are the key to building a high tech economy in Santa Cruz and Monterey counties. That’s the message from executives at four of Santa Cruz’s hottest start up companies, speaking at the kick off conference for the Monterey Bay Economic Partnership (MBEP) on 29 January 2015.

“There’s not a thriving scene of professionals in Santa Cruz yet,” said Carolyn Hughes, VP of talent and culture at Looker. Her company maintains a shared work space in San Francisco, allows employees to work remotely two days a week, and pays for rooms in a local hotel so commuters can work in Santa Cruz the other three. One of the barriers to convincing people to make the move is finding jobs for spouses and partners.

“We have senior folks and the entry level talent, but we’re trying to fill that gap in the middle,” said Keri Waters, COO at Vivo Technology.

Start ups need access to angel funding and venture capital, which is easy to find over the hill. But Silicon Valley investors don’t naturally look to the central coast to find opportunities.

“They don’t see as driven a group of workers as on the other side of the hill,” said Brian McDonald sales VP at PredPol. The area “doesn’t resonate as well with investors.”

Looker has raised a lot of a capital, Hughes said, but “our challenge has been to demonstrate that we can adequately deploy that capital” in Santa Cruz.

“Can Monterey County have it’s own unique culture but still drive growth?” asked Jeremy Almond, CEO of Scotts Valley-based PayStand. “Santa Cruz and Monterey are less about pure work/life balance. It’s a little bit like having your cake and eating it too.”

Infrastructure, particularly the lack of affordable housing, is the biggest barrier to attracting and keeping the people the region needs to fill talent gaps, according to the panelists.

“That’s our highest pain point right now,” Hughes said.

Other infrastructure problems include lack of parking, clogged roads, scarce office space and limited broadband availability.

It’s important to keep in mind, though, that the problems Santa Cruz start ups are experiencing are problems that come with success. Much of the discussion that followed was about how to repeat Santa Cruz’s success elsewhere in the region, where the supply of resources and infrastructure still exceeds demand.

The goal for the more than 200 regional business and government leaders who took part in the conference, and MBEP’s reason for existing, is to build an entrepreneurial ecosystem. That “starts with research and intellectual property, and then applies talent and capital,” according to Bud Colligan, CEO of South Swell Ventures and MBEP’s co-chair. It’s not about changing the essential nature of the region, but adapting it to the realities – the opportunities – of California’s high tech economy.

“We can either be crushed by the wave or ride the wave,” Colligan said. “I prefer to ride the wave, having been crushed by waves many times.”

Eastern California businesses challenged by booming bandwidth demand

by Steve Blum • , , ,

You got a job to do.

“Five of you can take out my Internet and I have 93 rooms”, Dan Spurgeon, general manager of the Marriott Springhill Suites in Ridgecrest said. That’s despite his recent 50 Mbps upgrade, which he will soon need to re-double. He was one of several local leaders speaking at the Eastern Sierra Connect Regional Broadband Consortium conference in Ridgecrest on Thursday.

Rapidly growing demand for more bandwidth – 40% year after year according to Spurgeon – is a major challenge for businesses and government agencies in eastern California. The Digital 395 project is now lit, but last mile and enterprise facilities have to be upgraded to make full use of it.

The China Lake Naval Air Weapons Station in Ridgecrest, for example, is still doing teleconferencing via ancient ISDN circuits (as well as having modern, fat pipes). “Ageing fiber optic infrastructure” on the base is “nearing end of life, it was installed in the early 80s, the mid 80s”, said Justin French, an IT executive there. “We need to look at the next five to ten years”.

Fixing it isn’t just a matter of finding the money. It’s also about taking down barriers that block construction. “I don’t need red tape”, said Kishor Joshi, president of Pertexa, a health care IT consulting firm.

It’s a problem that needs to addressed in Sacramento, said Kimberly Maevers, president of the Greater Antelope Valley Economic Alliance, a local economic development organisation. “We have to demand [California Environmental Quality Act] reform so the IBEW and any other special interest group can’t come in and hold us hostage”.

The only option is to build, and use, better infrastructure, said Eric Bruen, who runs the Desert Valleys Federal Credit Union. “If you’re not moving as fast as your consumer, you will be left in the dust”.

Sustainable economic growth on California’s central coast demands cooperation

Yearning creativity seeks willing opportunity.

The economic drivers in California’s central coast region are agriculture and tourism, which account for just about half of private sector jobs in Monterey and Santa Cruz counties.

But the region also has a well educated workforce that commutes to Silicon Valley and beyond – 24% of Santa Cruz residents, according to Bud Colligan, CEO of South Swell Ventures, who spoke at a regional economic development forum in Seaside. He talked about building a regional high tech economy by creating opportunities for people to work where they live…

The usual narrative about tech on the Central Coast is about companies that have left or missed opportunities (Seagate, Digital Research, Borland, SCO, etc.) But [Cruzio, Redshift, Plantronics, Looker, Universal Audio] have been built from local technical and business talent, and in some cases are veterans of companies that left (the people stayed!). And there are many new start-ups that hope to join them.

Colligan’s prescription is to use the region’s unique assets – marine science, genomics and organics research, proximity to Silicon Valley for example – to build an entrepreneurial ecosystem centered on small companies. He’s adding necessary financial fuel: starting Central Coast Angels, a fund to connect early stage investors with innovative local start-ups, and expanding Opportunity Fund, a micro-lending institution, in the region.

There’s no lack of sparks. Santa Cruz has a growing cleantech sector, built around a coastal lifestyle and the human capital that thrives on it. Watsonville and Salinas, and the valley south of it, are home to agricultural technology companies – scrappy start-ups and quiet but long established enterprises alike – that already serve global markets.

Colligan wants to entice regional political and private sector leaders into cooperative efforts, investing in intellectual property and labor force training with regional goals in mind. The challenge is to overcome habitual hyper-local thinking. The reward is a sustainable economy that complements the region’s greatest assets – its “quality of life, natural beauty, clean environment” – and allows people who live here to thrive here.

Chattanooga notches up a major geek milestone with Ironman selection

by Steve Blum • , , ,

I’ve been waiting a long time for an excuse to post one of my Ironman finisher photos.

When people outside of the industry ask me “What do you do?”, I usually answer “Swim, bike, run. Eat, sleep. Repeat.” If pressed, I’ll admit to doing something or other with broadband, then quickly steer the conversation back to triathlon, particularly the ultra-distance form of the addiction sport. So I can’t resist the temptation of a press release from the World Triathlon Corporation and the Chattanooga Sports Committee, announcing Ironman Chattanooga, a new race beginning in 2014.

There are two ways to get WTC to bless your town with a Ironman branded race: give them a couple box cars full of money (Louisville, Tempe) or be insufferably cool enough (Tahoe, Boulder) to satisfy the brand managers and bloated egos that clog the hallways there. Preferably both.

So I had to ask myself: which one was it? Several southeastern U.S. cities wanted the race, including Hilton Head Island, Myrtle Beach, Greenville, Raleigh, Winston-Salem and Asheville. Hilton Head and Myrtle Beach probably have too much cool to put up much cash, and the rest would have to depend on money alone. Chattanooga brought both to the table.

I have no idea about the money, but the cool had to come from the gigabit buzz that’s making Chattanooga a regional high-tech mecca. Tri-geeks are, well, geeks. We buy unobtainium bicycles, plant electronic sensors in places where the sun doesn’t shine, spend more time crunching stats than abs and hope Asperger’s is contagious so we can focus better on our workouts.

Anyplace with that much bandwidth must have good coffee and craft beers too. Plus, the downriver swim course is emblematic of Chattanooga’s gushing bit streams. So it’s not cheating. Honest.

For those wondering, an Ironman involves a 3.8 km (2.4 mile) swim, 180 km (112 mile) bike ride and a 42.2 km (26.2 mile or marathon) run. According to the man who invented it, John Collins, if you do the distance you’ve done an Ironman and you are an Ironman. Even if you haven’t signed your 401K over to WTC for the privilege. Even if you’re a woman because, face it, if they called it an Ironwoman it would have to be much harder.

Eastern California lights up in July

“We have started and we will finish,” said Michael Ort, CEO of Praxis Associates, the company behind the Digital 395 project. “There have been people who have bet against us and that’s a great motivator. It’s going to happen.”

The ambitious, ARRA-funded network will connect Reno to Barstow, in the California desert east of Los Angeles, installing nearly 600 miles of fiber optic cable. Most of the path runs along U.S. 395, down the eastern side of the Sierra Nevada through towns like Carson City, Mammoth Lakes, Bishop and Ridgecrest.

Ort was giving an update to a community broadband forum organized by the Eastern Sierra Connect Regional Broadband Consortium in the Mono County town of June Lake. The project has been enthusiastically backed by local officials and residents, who are eager to bring high capacity, carrier grade middle mile connectivity to the many small towns, communities and tribal lands along the way.

But even with that support, bureaucracy has been the biggest obstacle he’s had to overcome.

Problems have come from the maze of state and federal regulators that have a say. Twenty three different agencies had to sign off on project plans, a process that ate up two years of what is supposed to be a three year project.

“You have to satisfy everyone’s needs,” said Ort, explaining that different agencies have different objectives and sometimes exactly opposite requirements. For example, one might ban digging along a certain route while another might require it. Approvals included individual permits for almost 400 archeological and historic sites.

Even so, Ort is confident they’ll have it operating by the 31 July 2013 deadline.

The project is funded by $81 million from the 2009 federal stimulus bill, under the Broadband Technology Opportunities Program (BTOP), and $19 million from the California Advanced Services Fund. Ort says construction costs – not counting permits and environmental clearances – are running between $25 and $30 a foot. Much of the work involves plowing fiber into the ground, but some it requires using a giant “rock wheel” to chop through granite.

When it’s done, Digital 395 will dramatically reduce the cost of connecting to the Internet from eastern California. Customers will primarily be major institutional users, Internet service providers and other resellers, and major telecommunications companies that want a back-up path between northern and southern California. Plans are to price 100 Mbps of Internet connectivity in the one thousand dollar range, using traditional T-1 lines as both pricing and quality of service benchmarks. Simple Layer 2 – Ethernet – connectivity would be about $6 per Mbps, under current plans. Pricing would be flat and not dependent on distance.