First published in "Techlink," The Daily Record, Baltimore, May 2002
"Smart development" in Southern Maryland Rural areas look to broadband technology to spur economy
By Russ Barnes Special to The Daily Record "Imagine the owner of a pizza parlor looking to locate his shop side-by-side with another pizza place," Lewis Powell said at his office in Waldorf. "So now the pizza parlor owner has got the same expenses and half the revenue. Not a formula that works." Powell, chairman of Charles County Technology Council, an association promoting high-tech company relocation to Southern Maryland, continued, "Technology shops, on the other hand, thrive on next-door locations" because, unlike the competitive nature of retail businesses, it appears there is productive synergy for technology companies when they are networked within adjacent geographic locales. Because of an economic growth strategy they call "smart development," the three counties of Southern Maryland are trying to attract technology companies -- companies that produce and disseminate knowledge, not smoke or urban sprawl. These companies include software publishers, high-tech training companies and engineering firms serving government installations. But such entities require a component sometimes missing in Southern Maryland. No, it's not the lack of a favorable tax environment -- nor a lack of access to big markets. Rather, it is broadband Internet access that sometimes is missing -- without which, according to Powell, "You can hardly attract even the first company needed in order to lure that prized second one." And so, for the want of broadband, the "horseshoe nail" of regional development, the network synergy of side-by-side technology companies is lost.
Economic key "Broadband Internet access has become a material factor in the equation of economic development," says David Jenkins of the Tri-County Council of Southern Maryland, which serves Calvert, Charles and St. Mary's counties. Broadband, or high-speed Internet access, allows computer users up to 50 times the effective connection speed to the Internet -- sometimes as high as 155 megabytes per second. And it ís always on -- connected, no dial-up required. It ís like taking a pipe the size of a straw and replacing it with one the size of a Roman aqueduct. And Broadband means more than just being able to do what you're already doing at a faster pace, according to Wayne Devereux of Veridian Inc., an engineering consulting firm for the Patuxent Naval Air Station located in Lexington Park in St. Mary's County. "It allows users the capability to do brand-new things altogether. It grows your capacity to do business. It gives you a competitive edge," he says. That competitive challenge is what Southern Maryland and many other rural areas now face. "In addition to outdoor industries like farming and fishing," says Jim Shepherd, director of economic development for Calvert County, "we have a pretty good retail base and a robust population of ex-urbanites who commute to well-paying urban jobs. What we do need is a bigger manufacturing base. But we're not in the business of chasing smokestacks or shopping malls. We want to preserve our farmland, our unique quality of life, and at the same time to bring in well-paying jobs that people can work at here in the county." Unfortunately, the region is discovering that it is sometimes unable to compete with other areas where broadband is more universally available. "With our highest-level technical contractors, we demand two-way broadband access," said Pete Butt, a telecommunications team leader at the Patuxent Naval Air Station, the economic engine of the region.
Development challenge And so, Southern Maryland has embarked on what many call "smart development" -- part of which means getting ubiquitous broadband Internet service off the dime and into the homes, shops, factories, labs and offices in Southern Maryland. That challenge requires sorting out what broadband options are out there, and what is the feasibility and purpose of their use; what demand is there, and how ready are providers to fulfill it; and who has the most incentive to galvanize access to this technology? Motivated by varying levels of vested interest in broadbandís future, there are a number of obvious constituencies that could be the impetus for technological change in Southern Maryland. These include mainline service providers such as Verizon and WorldCom, alternate providers such as Network Maryland, county and state economic developers, federal agencies, Internet service providers, telecom manufacturers, investors and ultimately citizens themselves. For the motivators above -- both those seeking broadband access in Southern Maryland, and those providing it -- there may be more options available than may be readily apparent. Each approach has its plusses and minuses. Many associate high-speed Internet access with a technology known as DSL (digital subscriber lines), which is gaining subscribership mainly in urban areas. DSL is only one species of many broadband technologies. DSL, which uses so-called "dedicated" lines, does not suffer an Internet connection speed decrease with shared usage. Another broadband solution is made possible by cable television companies by means of cable modems. But cable TV originally was developed as a one-way video service and because of that, many areas are not yet built-out and not ready for the two-way interactive service required for the Internet. The cable solution is furthermore a shared service, and so, as usage goes up in any region, its service speed will go down. But it is an excellent option when available. Two other options for rural areas such as Southern Maryland include satellite dishes, which work much like satellite TV, and a wireless radio system, which operates like cellular phone systems. But these two options are not yet stable technologies. Anne Whitaker, a consultant who works from her home in Calvert County with her Web designer husband, uses two systems: dial-up and satellite. "When one system's down, we fire up the other," she said.
Demand and incentive But how many people are exploring these choices; how widespread is the demand for broadband? In many ways, the need is comparable to that of PCs in the early days. Consumers at the time didnít know why they were buying computers. Only when they bought them did they find out how to make their businesses more productive. And that meant competitors had to go out and buy PCs to keep pace. So with time, broadband demand will grow. But as it does, it may prove that there are gaps in coverage on the "telecom highway" -- that components such as fiber backbone, coaxial cable and service nodes don"t reach into more discrete geographic areas. Last month the Maryland Technology Corp. (TEDCO), a state-sponsored research group, released a statewide study of telecom "maps," which illustrate the ready and almost-ready resources of telecom providers such as Verizon, WorldCom, Comcast and Network Maryland. But Whitaker thinks that more research needs to be done. So does Robert Pepper, chief of the Federal Communications Commissionís Plans and Policy Division, who points out that, "If communities can identify aggregate demand within geographic clusters, there are various business options open to them." Indeed, geography plays a central role in telecommunications services, not just in the direct correlation between metropolitan proximity and level of service, but because communications lines must cross many property lines -- both public and private -- and demand-clusters are defined by location. Sam Young of Calvert Commercial Real Estate notes, "We have lots of national clients coming in to our properties who absolutely require broadband access." Young also thinks that soon the day will come when property values -- both home and commercial -- will be affected by broadband access. "Just like water, sewer and electricity affect values," he says. And so, out of all the constituencies seeking broadband, it may be real estate developers and brokers and Internet service providers (ISPs) who have the most motivation to bring the technology to Southern Maryland. Real estate companies have their ear to the ground to sound out aggregate demand by location. And ISPs have both the technical skills to implement broadband and the retail orientation to serve individual customers. Some of the ISPs may not be robust enough financially to provide service, but with the help of real estate and other interested constituencies, such as local economic development groups and individual investors, galvanization of broadband access may become a reality to areas that make sense economically. How might such a scenario work? There is ample precedent in the telecommunications business for sharing communications resources on a geographic basis -- whether that service is provided on a shared-tenant service or a shared-neighborhood basis. A real estate owner or neighborhood association might contract an ISP or other retail provider such as Verizon or many other independent retailers. Once it knows the demand, the provider would research the technology, expenses and up-side involved in any specific geographic demand cluster. The technology might include such equipment as high bandwidth, T1 lines to activate broadband access to the demand cluster. There may be other incentives in the wings for universal broadband service. Several bills are before the U.S. Congress to modify the Telecommunications Act of 1996. The most controversial is H.R. 1542 (Tauzin-Dingell). But there are others, which propose to provide tax and other incentives to entrepreneurial efforts that bring universal access to rural areas. Whether it will be radios or satellite dishes that will help provide Southern Maryland's broadband Internet access or something else is not yet decided. But some creative business, technical, political and investment solution will be needed to provide "smart" development to the region -- and the pizza parlor Lewis Powell spoke of may just get some high-tech neighbors.
(c) 2002, RUSS BARNES |