Does a compact city with a few hundred thousand people have an advantage over several million inhabitants sprawling across a huge metropolis?
The romantic view is the smaller cities should prevail but history, particularly given the wide sprawl of Silicon Valley, indicates the opposite.
While Silicon Valley, and most of the other Twentieth Century industrial hubs like Detroit, were sprawling conurbations it may be this era’s centres are more compact with towns being walkable.
Certainly this is what we’re seeing with the tech industry’s shift into San Francisco as workers find they’d rather walk or cycle to work than spend hours on freeways each day.
So it may be the newer breed of businesses and industries that don’t need massive infrastructure also don’t need to sprawl.
If that turns out to be true then cities like Wellington could do well.
Last night for the monthly ABC Nightlife tech spot we looked at Samsung’s spying TVs and some of the other aspects of security with connected devices.
During the listeners’ calls it became very clear many are worried and scared by technology’s rapid progress. This is a challenge for the leaders of both the tech industry and governments.
Lenovo’s actions raise a serious concern for business as many of those home units may have been connected to office networks under corporate Bring Your Own Device policies and the spoofing of security certificates could cause no end of problems and risks for IT managers.
Another concern Lenovo’s actions raise is about the Internet of Things; if various devices on a network are messing with data integrity, confidence in the information being generated is eroded.
For the tech industry, it’s essential to regain the community’s trust. Equally however it’s essential for business and political leaders to have an honest conversation with voters and workers on how the structure of the workforce is changing.
Nestled in a quiet wooded valley near the modern town of Telford in the English Midlands is the birthplace of the industrial revolution.
Today the three quiet villages — Coalbrookdale, Coalport and Ironbridge are quaint little communities but two hundred years ago they were the powerhouse of the Industrial revolution.
The hills around Ironbridge
Coal and ironstone mining in the district started in medieval times with the locals having a wide range of words to describe different types of coal — Lancashire Ladies, Randle and Clod being just a few terms.
Iron had been smelted at Coalbrookdale from the late 16th Century however the arrival of potmaker Abraham Darby in 1709 that catalysed the industry with his method to reliably use coke for the blast furnaces.
Coalbrookdale by night – the Bedlam furnaces at their peak
Further downstream, the Madeley Wood smelter became infamous as the bedlam furnaces, named after the noise and confusion of London’s notorious asylum.
With the new reliable way to smelt iron and a string of blast furnaces along the valley, production skyrocketed and the valley’s natural advantages of accessible coal, iron and water meant it became the centre of the industrial revolution.
Increased production meant more workers and people flocked in from the surrounding agricultural communities — not in a dissimilar way to today’s experience in China.
That increased population meant more slums, what is today’s cute village was once sqaulid poverty, albeit an improvement on the life of an agricultural worker. Epidemics were common with 32,000 lives lost in cholera in 1831-2.
Despite the squalor of the workers’ quarters, the ironmasters were proud men and Coalbrookdale’s new bridge could only be build of one material — iron.
“This Bridge was cast at Coalbrookdale”
Ironmasters like John Wilkinson and Abraham Derby III were also ferocious promotors of their product and the bridge stands as a proud, strong advert for the strength of Coalbrookdale’s iron. Wilkinson himself built the first cast iron barge a few years later and was eventually buried in a cast iron coffin.
Boy and Black Swan cast iron statue
Eventually though the smelters of Coalbrookdale began to lose their competitive edge as mining and blast furnace technology improved, the ironmasters responded with moving into decorative and intricate cast iron features like the Boy and Swan statue that now graces the gardens of the Coalbrookdale Iron Museum.
The ruins of the bedlam blast furnaces at Coalbrookdale
Despite their successes, Coalbrookdale’s slide continued, with coal production peaking in 1871 and a steady decline over the following century.
Today, there’s not a lot of industry in Coalbrookdale except for one plant that keeps the area’s engineering tradition running.
For Britain, the question is how the nation’s economy continues it’s engineering traditions, 45 minutes drive away is a relic of Twentieth Century industry — the Austin motor works at Longbridge.
Today an assembly plant fills a small corner of the formerly sprawling factory site and over it flies the flag of it’s new owners. The People’s Republic of China.
One of the most profitable areas for many companies has been in fixing broken products, now the internet of everything promises to put an end to that business model.
‘Break-fix’ has always been a good profit earner with business ranging from construction companies to washing machine manufacturers making good money from fixing failed products.
Speaking at a lunch in Sydney earlier today GE’s CEO of Global Growth and Operations, John Rice, described how the Internet of Everything is changing in the industrial landscape.
One of the big business changes Rice sees is in the ‘break-fix’ model of many industrial suppliers.
“We grew up in companies with a break fix mentality,” Rice says. “We sold you equipment and if it broke, you paid us more money to come and fix it.”
“Your dilemma was our profit opportunity,” Rice pointed out. Now, he says engineering industry shares risks with their customers and the break-fix business is no longer the profit centre it was.
Goodbye to the TV mechanic
This is true in many other industries as products become both more reliable and less economical to repair – the local TV repairman has largely vanished and the backyard computer support businesses are going the same way.
For many businesses, this means a change to how they service their customers and the nature of their operations. For many, it means close monitoring of their products will be essential to manage risk.
Rice also flagged how grid computing will improve the reliability of equipment and networks citing how giant wind turbine talk to each other.
“Every wind turbine has an anemometer on top that’s used to judge wind speed and direction,” says Rice. “If you had a problem with the anemometer the wind turbine shut down until someone could come out – maybe a week later – to climb to the top of the turbine, diagnose the problem and start the thing back up.”
“Today the technology is such that the wind turbines talk to each other so if you’re in a wind field of thirty turbines you don’t rely on one anemometer,” points out Rice. “This is a very simple example of machine to machine interface.”
Wind turbines and the road toll
Rice’s example of wind turbines talking to each other is similar to Cisco’s scenario of using the internet of everything to reduce the road toll where cars communicate with road signs, traffic lights and each other to monitor conditions on the highway ahead.
Those machines talking together also give early warnings of problems which reduces downtime and risk for industrial users, it also means less money for businesses who’ve made money from those problems.
The decline and recovery of US manufacturing is a story of our times – the industrialisation of Asia, trade treaties such as NAFTA and China’s joining the World Trade Organisation all saw Western producers move their operations overseas.
Coupled with domestic manufacturers’ increased investment in automated systems which makes labour costs a smaller factor and the sums start adding up for making things in the United States.
Unfortunately for the workforce, those automated plants don’t require anywhere near the staff older factories employed and the skills required in today’s mills are substantially different from those needed in those of earlier times.
Most industries are encountering the same change and new technologies make the modern factory very different to that of a few decades ago.
The jobs aren’t going to come back in the numbers that were once employed, as the New York Times story illustrates with the decline in the working population.
Despite the recovery in US manufacturing, today’s industry is very different to what it was last century, something that’s missed by those advocating a return 1950s style government policies to protect jobs in sectors like car manufacturing.
Even if they are successful in rejuvenating local car factories, cotton mills or coal mines, the days of these plants employing tens of thousands of grateful cloth capped workers are over.
Those politicians whose ideology is based on the old model, or businesspeople who want to work in the old ways, are going to find the modern economy very difficult and challenging.
