Allocating Broadband for Maximal Innovation

Will investing additional broadband resources in university towns create new inventions that ultimately create high-value jobs?

According to last week’s op-ed piece by New York Times columnist Thomas Friedman, the answer is yes. Friedman makes a compelling case that today’s growing mountains of available data will become the new raw material of industrial innovation. He writes, “The best of these ecosystems will be cities and towns that combine a university, an educated populace, a dynamic business community and the fastest broadband connections on earth. These will be the job factories of the future.”

University towns contain a rich resource of raw data, scientific knowledge and highly educated scientists and researchers. However, just harboring a research university should not automatically qualify a town for additional broadband. Friedman omits one major piece of the puzzle: many college towns lack a strong industrial base, meaning they are not home to manufacturing companies, nor to populations of people who make their living bringing products to market.

Manufacturing towns innovate, too

Why would the presence of a regional manufacturing base matter if a university town is already rich in human capital? Because mono-cultures are not fertile. If a university’s R&D labs are isolated from the demands of commerce and manufacturing, additional broadband, alone, won’t spark sufficient amounts of innovation. R&D that remains abstract is at risk of withering from “small picture myopia.” Instead, new ideas emerge when collaboration is decentralized and participants bring diverse skill sets to the table to address a particular technical problem. The most fertile regions will be those that boast local communities where university researchers and scientists rub elbows with industry engineers and technologists who have deep and applied industrial expertise.

A group of universities have launched an initiative called Gig.U. Their goal is to make a case to private network providers that university towns are an ideal test-bed for additional investment in ultra-high-speed networks. It would be an interesting exercise to consider two additional key variables in the context of what they’re doing: 1) whether a university town has easy access to a manufacturing base, and 2) whether the local business community is of critical mass and knows how to work with manufacturing and design companies to transform raw university R&D into commercial goods and services. Ideally, one could argue, cities that should receive additional broadband are ones that have people skilled in manufacturing, skilled in running businesses *and* a nearby research university — these are the raw ingredients that will enable a city to put a hefty, high-speed network to good use.

Federally funded university research is rich raw clay from which many valuable new technologies and medicines are made. But supply chains, small businesses, and the collaborative spaces between people with different skill sets are also a rich and vital source of new thinking. In an excellent article by Fred Block and Matthew Keller called “Where Do Innovations Come From? Transformations in the U.S. National Innovation System, 1970-2006,” the authors analyze ten years worth of 1,200 prize-winning inventions selected by R&D Magazine’s prestigious annual contest. Their goal was to figure out whether the way inventions are made has changed over the past few decades. The authors discovered that in the 1970s, most winning inventions came from the R&D labs of a single, large, corporation. In recent years, however, more than two-thirds of winning inventions were the product of mostly federally-funded collaborations between businesses and government and university research labs.

Changing modes of invention aside, another advantage to factoring manufacturing capacity into broadband allocation is the fact that innovation springs from the people and companies on the front lines. Many people still believe that innovation happens in a simple, linear model where early-stage research leaves the lab in a tidy pipeline, is taken up by an entrepreneur and/or corporate product development team, and then hammered and packaged into a viable commercial product. In fact, new ideas come from everywhere.

According to an 2006 IBM study in which 750 CEOs ranked their sources of new ideas, over three quarters cited business partners, customers, even competitors as leading sources. Formal, internal R&D ranked eighth. Here’s the list.

Most manufacturing regions are urban, not rural. What about rural areas? In the U.S., the key for broadband allocation has been a region’s population density; as a result, rural areas are currently underserved. Network service providers recover infrastructure costs by attracting paying subscribers. Therefore, cable, telephone and internet companies are more incented to sink money into setting up high speed networks in regions with lots of affluent people. A community that is remote or populated by people that have low incomes (or both) is more likely to be on the wrong side of the digital divide.

Perhaps participating Gig.U universities in rural areas could consider extending their efforts to include their regional communities. This would kill two big birds with one stone: many rural areas are already currently underserved. Second, high speed networks could jump start rural economies in university towns by bringing remote communities into closer contact with colleagues in commerce-rich, distant urban areas. Since remote regions are divorced from tools of mass production, they could be well suited to do the abstract and theoretical analytical work of extracting commercial value out of vast reams of raw data as described by Friedman, “.. mountains of data .. which can then be collected, sifted, mined and analyzed — like raw materials of old — to provide the raw material for new inventions in health care, education, manufacturing and retailing.”

Conclusion

Broadband both affects, and reflects a community’s economic opportunities. That’s why it’s essential that high speed networks are allocated fairly and thoughtfully, and that all types of communities are considered potential sources of innovative new technologies and business models. Friedman writes that “The more information and trends you are able to mine and analyze, and the more talented human capital, bandwidth and computing power you apply to that data, the more innovation you’ll get.” Yes, by all means, let’s explore the potential ROI of investing in high-speed networks in university towns. But as the political battle over broadband allocation heats up, let’s make sure that the allocation game plan accounts for the reality that talented human capital exists everywhere and that innovation is not a tidy, centralized process.

imagecredit:ictnews

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Melba Kurman writes and speaks about innovative tech transfer from university research labs to the commercial marketplace. Melba is the president of Triple Helix Innovation, a consulting firm dedicated to improving innovation partnerships between companies and universities.