Throughout history transportation systems have been essential elements of economic development. Game trails became paths for humans to get from place to place. The paths became wagon ways, then roads and finally interstate highways. While this evolution was taking place villages, towns and cities grew up along these transportation systems. The same thing occurred along canals, railroads and airports. Communications systems grew up along these populations centers and connected them just as transportation systems connected them. A growth synergy developed between the cities, the transportation systems and the communications systems. Growth of each required and stimulated the growth of the others. With the development and eventual integration of electronic computing and telecommunications systems the communications component of this relationship accelerated in importance. Recently, communications broadband highways have become at least as essential as physical transportation systems to the economic growth of a region. In some areas broadband systems have become the surprise element that has stimulated a city or region to much greater economic success than neighboring areas.
During this presentation we will recommend some objectives and discuss, in very high level terms, what it takes for Dayton to create a broadband infrastructure highway as an economic development tool. There are supporting slides and references attached to this presentation that provide examples and studies that show that broadband communications systems have become essential elements of economic development. Even though we will be restricting our examples to the United States it is easy to find examples in other parts of the world. We will show that some places have, with great documented success, deliberately installed broadband systems as economic development tools.
This is just a partial diagram of Dayton’s broadband highways. Even this partial diagram shows linkage through areas along where there are colleges, k-12 schools, hospitals, cultural centers and businesses. These fiber optic cables can be used a extremely high capacity conduits of information between enterprises. In a follow on phase these high capacity highways can be used a backhaul circuits to wireless systems operating at lower bandwidths and extending deeper into the communities along these routes.
As is true anywhere, a properly designed broadband network in Dayton would be based on a common infrastructure that supports numerous applications. Some of these applications are obvious while many are still waiting to be discovered. Many analogies between broadband telecommunications infrastructure and the streets and highway infrastructure can be made. In Dayton our unused fiber optic systems (installed as traffic signals fiber) lie along routes occupied by hospitals, emergency response facilities, research and development institutions, residential housing, private and non-profit business enterprises and K-12 and college educational institutions. This fiber system is hubbed on Dayton City Hall and connected via fiber optic cable to a network switch at the City of Dayton Computer Center on the third floor of the First National Building. The First National Building is also occupied by many Internet service providers (ISPs). These assets can be integrated into a single broadband “highway” serving Dayton’s enterprise zones and residential areas. This single electronic infrastructure can support a number of telecommunications applications that are elements of a single network even though they may look like separate networks. For example, Good Samaritan Hospital, Miami Valley Hospital and Grandview Hospital all lie adjacent to unused traffic signals fiber. They could be interconnected into a network that addresses many e-health issues. Many public emergency response facilities lie along these unused fiber routes and could be interconnected to provide improved emergency support. These emergency response facilities could be interconnected to the “hospital network”. In like manner many of the other network systems shown above could be built to look like individual networks. However, since they would be built on the same infrastructure with gateways between them they would be part of the same system. The overall positive effect is greater than just providing high capacity, survivable, low-cost broadband communications. Just as our roadway systems are essential for economic development this broadband highway is an economic development tool. At the same time it reduces cost of operation it also improves the interaction between businesses. This improved interaction promotes businesses doing business with each other within the region instead of going to others outside the region.
The United States Department of Commerce commissioned MIT to do a study of the economic benefit of broadband communications systems. MIT published the study in Feb 2006 documenting results that conclusively showed that properly designed and implemented broadband systems had a significantly positive effect on economic growth. The positive results showed up in job growth, the addition of new business establishments, increased housing rents, and an industry mix that improved the continuing opportunities for economic growth. In addition to this generalized study there are some specific examples.
Cedar Falls and Waterloo, Iowa are neighboring cities that are similar in many ways. Waterloo is larger with a population of 69,000. Cedar Falls has 36,000 people. Cedar Falls has municipal utilities including a city built and owned fiber network. Waterloo’s communications services are provided through the private sector. Waterloo has historically been positioned for better growth with Cedar Falls considered to be a bedroom community. However, Cedar Falls economic growth has far outstripped that of Waterloo and the city leaders of both Cedar Falls and Waterloo give the credit for that to the Cedar Falls municipal owned fiber optic telecommunications system. This system interconnects all Cedar Falls school buildings, higher education, the major hospitals, state and federal government buildings, libraries via high quality, full-motion video and high speed data communications. Cedar Falls Utilities’ fiber backbone network consists of five primary loops of cable that surround various parts of the city. In addition, five secondary loops of fiber cable surround areas within the city that have a heavier concentration of high-bandwidth users. The loops of cable assure exceptional reliability by providing two paths for all large users, both downstream from the headend and upstream from the customers.
Cedar Falls and Waterloo are located on the “Avenue of the Saints,” a federal interstate highway that connects Minneapolis, Minnesota to St. Louis, Missouri. Both communities also have equal access to interstate highway 380, U.S. highways 20, 63, 218 and Iowa highways 21, 57 and 58. An article in the March 11, 2002 Waterloo Cedar Falls Courier reported, “The vast majority of new industries moving to the Cedar Valley are locating in the Cedar Falls Industrial Park, which has caused some discontent from local business leaders and residents wondering why Waterloo is falling short. While officials note any jobs created in Waterloo-Cedar Falls benefit the entire area, Waterloo needs industrial development to boost its tax base. An earlier article published in the same newspaper on August 21, 2001 quoted Waterloo Mayor John Rooff. “Fiber optics is the key to Waterloo’s future growth,” Rooff said. “In order for Waterloo with its businesses to move into the 21st century, we need fiber optic capability…I believe it has hurt us economically not be able to provide fiber optics to businesses locating in our city.”
“In 2001, Lake County – a small, central Florida county of nearly 250,000 residents and 953 square miles – began offering private businesses access to one of Florida’s most extensive, municipally-owned broadband networks, with fiber optic connections to hospitals, doctor offices, private businesses, and 44 schools.15 Our study shows that Lake County has experienced approximately 100% greater growth in economic activity relative to comparable Florida counties since making its municipal broadband network generally available to businesses in the county.” “ the Lake County municipal system was constructed by private companies, the system leases capacity to private network providers, and customers use the system to supplement services from other providers” “since 2001, when the network was launched, Lake County has experienced a significant and sustained burst of economic activity relative to its peers, all of which have at least some private investment in broadband network. As a result, efforts to restrict municipal investment in broadband stand the risk of removing a significant and substantial tool for cities and towns that want to grow their economies and develop their communities.”
“Ohio’s economic future relies on our ability to compete in a high-speed, high-tech global marketplace,” Strickland said. “The Ohio Broadband Council will partner with the public and private sectors to help make sure that every Ohioan has viable access to affordable, high-speed internet service, regardless of where they live, work or learn.” The Broadband Ohio initiative will achieve the following goals of Governor Ted Strickland’s Turnaround Ohio Plan: Establish Ohio as a world-class competitor by making Ohio the national leader in the deployment and effective use of broadband networking. Develop jobs of the future by leveraging the state’s investment in broadband infrastructure to create a competitive, well-connected economy in Ohio. Create cost savings through the coordination of Ohio’s public broadband resources, leveraging the state’s significant investments and more efficiently operating and spending limited resources.
DubLink, Dublin’s existing system of underground fiber-optic conduits, provides high-speed voice, data and video communications to businesses. The network saves corporations time and money by providing an existing “telecommunications pathway” within the City’s business district on which businesses can lease space rather than construct their own lines. Soon everyone will recognize the entire City as a “hot spot” when Dublin goes wireless. The wireless computer capabilities will offer endless technological advances once thought to be far into the future. Just imagine: Dublin police arriving at what appeared to be a routine call only to find a volatile situation. With streaming video, the scene is relayed to headquarters and back-up officers are immediately dispatched. Being able to create a virtual office and connect to the Internet or fax documents from anywhere in the City, even from a park bench or golf course. Schoolchildren watching via individual laptop computers live research experiments being conducted by prestigious universities. From: http://www.dublin.oh.us/econdev/dublink.php
“ OneCommunity connects Northern Ohio’s public and nonprofit institutions to each other, to the world, and to leading technology vendors via our fiber-optic network – one of the largest and fastest in the world. OneCommunity enables innovative connections and collaborative solutions with an emphasis on education, health care, government, and workforce development. Utilizing information technology, we will transform Northern Ohio into a globally competitive region.” Cleveland Clinic has awarded OneCommunity a $2 million grant over four years to bring OneClassroom into more than 1,500 schools in 18 counties across Northern Ohio through connections to our region's Information Technology Centers (ITCs). OneClassroom offers: Distance learning opportunities, such as live surgeries transmitted into classrooms so students can interact with doctors during the procedure; A Digital Resource Library that allows students and teachers to quickly find and view state-approved content, including educational videos and other rich digital media from local and national providers; Refurbished computers and other cost-effective technology equipment for classrooms; Professional development resources for teachers and technical support http://www.onecommunity.org/programs/programs.aspx?ID=48
Fiber optic telecommunications cables are the electronic analogue of interstate highways. The almost totally unused fiber optic cable that Dayton has under its streets and on its telephone poles are like empty roads. Imagine if we discovered that Dayton has a large number of excellent streets that we didn’t know about running through enterprise zones, past educational institutions and cultural centers, and between emergency response and medical centers. Perhaps all that would be needed is to put in some driveways and parking lots to connect the businesses to these newly discovered streets. This is the situation we have with Dayton’s fiber optic cables that were initially installed for traffic management. These cables are less than 1% used and are in excellent condition. With relatively minimal expense we can make these cables useful as economic development tools by connecting them to the enterprises along their routes.
Dayton Broadband Mini Plan A Low Risk Phase One September 2009 IT Vision Consulting
Integrate private and unused, repurposed public telecommunications fiber to create a broadband network for economic development. The reduced cost of operation that results from using repurposed public telecommunications fiber will be passed on to consumers as lower priced broadband services.
This network will be managed under a public/private partnership to establish a Broadband Enterprise Zone (BE Zone) for use by commercial business, non-profit enterprises, educational institutions and government agencies.
The following Actions must be taken to reach the Vision and achieve these Benefits
Establish a private/public business model
Operated and managed by private sector telecommunications professionals
Integrate BE Zone with Ohio broadband initiative
Integrate the marketing and sales effort with economic development and the business chamber
Private/Public Partnership for a Dayton Broadband Enterprise Zone
Repurposed Government-owned fiber
Oversight by a private/public board
Operated by Telecommunications Experts
Available to all businesses, non-profits, educational institutions, emergency services, etc
Interconnection promotes local cottage industries
Fully integrated with the State of Ohio Broadband Plan
Proven catalyst for economic development
Definitely not a competitor with telecommunications companies
Sets the stage for “The Grid”
Telecommunications Superhighway System for Economic and Cultural Development Hospital Education Research & Development Business Sector Residential Services Emergency Response
Summary of Initial Actions and Cost $25,000 Connect Schuster Center $50,000 Connect to Dayton Schools Network $40,000 Install Redundant D-MIX at ________ $15,000 Install Local Switch in City Hall $100,000 Connect Major Fire and Police Stations $75,000 Connect Good Sam and MVH $50,000 Connect WSU and DaytaOhio $75,000 Connect UD and Sinclair COST INITIAL ACTIONS SUMMARY $35,000 per location Connect CareSource, Standard Register and Other Enterprises $10,000 Improve City Hall to D-MIX Connection
Summary of Initial Actions and Cost Notes: All costs are shown at about 30% higher than median estimate to give a worst case presentation. All locations are along existing Dayton-owned traffic signal fiber routes to take advantage of dark fiber and keep costs low. $25,000 per Connect District Wireless at Fiber Nodes $25,000 Connect Convention Center $25,000 per Establish District Fiber Nodes $40,000 Connect Art Institute COST INITIAL ACTIONS SUMMARY $35,000 per Connect Hotels
Suggested Vision for EDIT VISION Economic Development Asset Operational Tool INFRASTRUCTURE Underused and Fragmented Elements Integrated Broadband Enterprise Zone Broadband Enterprise Zone for Economic Development Wasted Infrastructure
Supporting Slides Additional Slides to Support the Argument for a Dayton Broadband Network
Economic Benefit of Broadband From Feb 28, 2006 MIT study for U.S. Department of commerce. For full report go to http://www.eda.gov/ImageCache/EDAPublic/documents/pdfdocs2006/mitcmubbimpactreport_2epdf/v1/mitcmubbimpactreport.pdf Economic Indicator Results Employment (Jobs) Added about 1 to 1.4% to growth rate from 1998 to 1002 Business Establishments Added about .5 to 1.2% to growth rate from 1998 to 2002 Housing Rents More than 6% higher in 2000 where broadband available by 1999 Industry Mix Added about .3 to .6% in IT intensive sectors from 1998 to 2002. Reduced share of small (<10 employees) establishment by 1.3 to 1.6% from 1998 to 2002
Infrastructure Costs per Mile Source: Canadian Broadband Taskforce and www.entrepreneur.com Fiber optics 16x expensive Wireless 37x expensive
“ There may be no single thing more important in a community’s efforts to achieve economic well-being than to grasp the role that telecommunications plays in creating meaningful jobs, enhanced education and world class healthcare. Now, more than ever, the direct link is evident between advanced communications and productivity and economic development.”
From: A Study of the Economic and Community Benefits of Cedar Falls, Iowa’s Municipal Telecommunications Network -- By Doris J. Kelley, October 2, 2003, updated July 6, 2004 www.baller.com/pdfs/cedarfalls_white_paper.pdf
“ There may be no single thing more important in a community’s efforts to achieve economic well-being than to grasp the role that telecommunications plays in creating meaningful jobs, enhanced education and world class healthcare. Now, more than ever, the direct link is evident between advanced communications and productivity and economic development.” From: A Study of the Economic and Community Benefits of Cedar Falls, Iowa’s Municipal Telecommunications Network -- By Doris J. Kelley, October 2, 2003, updated July 6, 2004 www.baller.com/pdfs/cedarfalls_white_paper.pdf
“ Cedar Falls set a Cedar Valley construction record this fiscal year, topping out at more than $101 million…Despite a downturn in the national economy, the city blew away all existing records in the fiscal year ending June 30…Meanwhile, the city of Waterloo failed to escape the stalled Economy” Waterloo-Cedar Falls Courier on July 12, 2002
“ When fully implemented, the Broadband Ohio initiative will ensure that all Ohio’s citizens, businesses, governments, educational institutions, non-profits and healthcare facilities have viable access to superior broadband services. Full participation in the digital society is crucial so that Ohio emerges as a global leader in: economic development, education, healthcare, innovation, world-class research and efficient delivery of state services; thereby powering Ohio’s economy and connecting to world markets.”
State broadband network will connect to regional networks
OneCommunity in Cleveland area
ConnectOhio is defining our region
Efforts in our area
Springfield fiber ring
Butler County Ring
Dublin, Ohio’s IT Infrastructure for Economic Development
DubLink, Dublin’s existing system of underground fiber-optic conduits, provides high-speed voice, data and video communications to businesses. The network saves corporations time and money by providing an existing “telecommunications pathway” within the City’s business district on which businesses can lease space rather than construct their own lines.
Airtouch located a headquarters in Dublin citing Dublink as a primary motivator. Nationwide located 8,000 job in Dublin at various campuses citing Dublink as a primary motivator.
Columbus, Ohio Private Investment for Economic Development
Fibertech's diverse route, "open-access" networks allow for numerous communications and Internet companies to offer facilities-based services. Its Columbus network connects strategic routes, passing key corporate centers, major switching hubs and other high data aggregation points throughout the city.
From: http://www.allbusiness.com/media-telecommunications/data-transmission-broadband/5988532-1.html and Business Wire, Sep. 4, 2002
Columbus FiberNet Route From: Columbus FiberNet Brochure “ Columbus FiberNet is an economic development tool to bring more high tech companies to Columbus. With a high tech population and high tech jobs, more technology companies will relocate to Columbus to expand their operations. And companies can expand and grow with the transparency of real estate, connecting one building to another next door, across campus, or on the other side of town. ”
Cleveland, Ohio’s IT Infrastructure for Economic Development
“ A successful fiber network deployment by OneCommunity has been leveraged by government and nonprofits to jumpstart new investment, improve health care delivery, bring the best in culture and education to urban schools, and engage tens of thousands of area leaders in collaboration over regional economic development”
Northeast Ohio is one of three U.S. regions to be recognized as 2008 Top 7 Intelligent Communities by the New York-based think tank Intelligent Community Forum (ICF). Northeast Ohio is now a finalist in the 2008 Intelligent Community of the Year competition. The winner will be announced May 16 in New York City.
The other six finalists represent a global footprint. They are Dundee, Scotland, United Kingdom; Fredericton, New Brunswick, Canada; Gangnam District, Seoul, South Korea; Tallinn, Estonia; Westchester County, New York, USA; and Winston-Salem, North Carolina, USA.