Tag: government

How important is public transport to smart cities?

Public transit systems may be essential to a city’s success in the 21st Century.

One of things that stands out when discussing economic development with city governments is the importance of public transit for towns aspiring to be smart cities.

This was particularly notable in interviewing Gordon Innes, CEO of London and Partners, about British capital’s building upon the legacy of the 2012 Olympics and its quest become the digital capital of Europe.

At the centre of these developments is public transit, something mentioned by both Innes and Laurel Barsotti of the City of San Francisco.

Innes sees public transport as essential to London’s growth, “it’s absolutely critical to the physical growth of the economy.”

“In the run up to the Olympics nine billion was spend in upgrading the tube and Dockland Light Railway and that opened up all of East London’s economy in way because it wasn’t accessible or attractive for businesses.”

“Stratford now is the best connected train station in Europe,” declares Innes. “That part of the city and around the Docklands is much more accessible and that’s bringing in investors. It wouldn’t have happened if the transport infrastructure wasn’t there.”

In San Francisco, Laurel Barsotti sees a much more subtle advantage for the city in having, by US standards, a comprehensive public transit system in its bus, light rail and subway system.

“A lot of the entrepreneurs creating those companies are concerned their employees see people using their products,” says Barsott. “They want them riding the bus to and from work and see people interacting with their products.”

While in Barcelona, the public transport system is forming part of the local Smart City program where bus stops are Wi-Fi base stations and a fundamental part of the town’s communications network.

For cities, it may well be that having decent public transit systems is going to be the competitive difference in being a key part of the 21st Century economy.

Those parts of the world not investing in transport networks may find they are being left behind in the new economy.

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How did San Francisco become the darling of the tech scene?

How did San Francisco become the darling of the tech scene?

Regular visitors to San Francisco would notice how the city has changed in the last few years.

Companies that were setting up in Silicon Valley are now basing themselves downtown, the business community is energised and the seedier parts of the town are looking substantially spruced up.

To understand the change I interviewed Laurel Barsotti from the City and County of San Francisco as part of the Decoding the New Economy series of video clips.

Laurel is the council’s Director of Business Development and we discussed how the local government has worked with the community and business leaders to drive San Francisco’s economic growth.

The shift from Silicon Valley

A striking change in the tech industry is how the startup focus has shifted from Silicon Valley fifty miles away to downtown San Francisco. Laurel puts it down to a shift in the priorities of the sector.

“I think we benefited from a shift in the tech industry, being much more focused on design and user experience,” says Laurel.

“The people who are investing in that are people who want in San Francisco and people who want to live and work in the same city.”

“A lot of the entrepreneurs creating those companies are concerned their employees see people using their products, they want them riding the bus to and from work and see people interacting with their products.”

Changing the tax code

Like Barcelona, the Global Financial Crisis shook the city up, “with the economic downturn our whole city made jobs a top priority.”

Part of that review focused on the disadvantages of basing a business in San Francisco.

“It was bought to our attention that we were the only city in California that taxed stock options.” Laura says, “companies that wanted to go public were having to leave San Francisco to afford it.”

“We did an entire revision to our tax code which showed to investors they could count on San Francisco to be business friendly.”

Regenerating communities

Along with the problem of city taxes, the city was facing the problem of regenerating blighted neighbourhoods and the administration decided to address both problems together by offering incentives for businesses to setup in the mid-market district – I’d been warned not to call it ‘The Tenderloin.’

“We had a neighbourhood that was facing a lot of blight and we had not been able to successfully increase business and we had companies like Twitter telling us that our payroll tax was causing them problems and making it hard for them to grow in San Francisco,” Laura tells.

“So we combined those two problems and made it so a San Francisco company was able to move into a neighbourhood that needed more investment and business and it would be able to save some money while helping us improve the neighbourhood.”

The future for San Francisco

A common point when talking to city leaders and economic development agencies around the world is the focus on building a diverse economy and Laura sees that as part of the future for San Francisco.

In that vision includes manufacturing, biotechnology and tourism along with the internet based industries that are today’s investment and media darlings.

The focus though is on the city’s residents and how life can be improved for everyone, not just the business community and high tech investors.

“We are really focused on creating an economy for all,” says Laura. “We want to remain as diverse as possible.”

“Every San Franciscan, from no matter what socio-economic background, has a place that they can be.”

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Raising a citizens’ army

Will communities have to volunteer their own labour to make up for service cuts by cash strapped governments?

In the English Midlands the leader of Birmingham City Council, the wonderfully named Sir Albert Bore, recently suggested a ‘citizens army’ be raised to provide services such as libraries that are being affected by budget cuts.

Bore’s suggestion is a response to his council cutting library services in the face of community anger and legislative obligations, to assuage both pressures it’s hoped local volunteers can continue to run and maintain the threatened facilities.

The bind Albert Bore and the Birmingham City Council find themselves in is a quandary all communities and governments are facing as an aging population causes tax revenues to decline at the very time the demand for government services increases.

Faced with cuts, many groups are going to have to take matters into their own hands to keep services running. Some communities will do this well while others won’t.

It’s also going to be interesting to see how this plays over generations with baby boomers being far more likely to volunteer than their GenX or GenY kids, something probably caused by more precarious job security in the modern job market and the need for younger couples to work harder and longer than their parents to pay their rent or mortgage.

Angry baby boomers demanding the ‘government ought to do something’ may well find the onus is thrown back onto them to provide the services they believe they’re entitled to.

What is the most fascinating part of this predictable situation is how governments around the developed world have blissfully pretended that this wasn’t going to happen as their populations aged.

Perhaps the biggest citizens’ army of all will be the voters asking why the Western world’s governments and political parties ignored  obvious and inevitable demographic trends for the last fifty years. That would be a question worth answering.

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The real thing behind the internet of things

We need to think beyond technology to get value the real value from the internet of things says Alicia Asin, the CEO and co-founder of Spanish sensor company Libelium.

We need to think beyond technology to get value the real value from the internet of things says Alicia Asin, the CEO and co-founder of Spanish sensor company Libelium.

Libelium and its CEO Alicia Asin has been covered previously on this blog and we had the opportunity to record an interview with Alicia at the 2013 Dreamforce conference.

Alicia told us about her vision for how she sees cities and governments evolving in an era of real time accessible information, in many ways it’s similar to where the Deputy Lord Mayor of Barcelona sees his city being at the end of this decade.

“I would say the biggest legacy the internet of things can bring is transparency,” says Alicia. “In the smart cities movement the IoT gives an opportunity for have a dashboard for cities.”

“You can see the investment made for reducing traffic investment downtown, the carbon footprint reduced and the return on investment,” says Alicia. “You can have very objective facts to supply to the citizens and they can make better decisions.”

For this vision to become true, it means government data has to open to the community which is something that challenges many administrations, however Alicia also told the story of how her company supplied Geiger counters to volunteers monitoring the radiation fallout around the damaged Fukushima nuclear reactor in Japan.

“We made a project in Fukushima when the nuclear accident happened where we sent some Geiger counters to the hacker space,” says Alicia. “Suddenly all the people with the Geiger counters started to publish the data onto the internet.”

“They were keeping a totally independent radiation map made by the activist citizens.”

Alicia raises an important point of how citizens can be using technology independently of governments. This was most notable in the Occupy movements across the United States that sprung up in late 2011 where hackers set up independent communications networks and recorded events outside the control of mainstream media and government agencies.

While citizens can use these tools to get around official restrictions, governments play an important role in developing new industries around these technologies, Alicia sees the smart city investments made by Spanish cities as creating the start of a Spanish Silicon Valley.

“Despite the economy, we are seeing a number of projects in Spain around smart cities,” Alicia observes. “In fact, I’m saying Spain is becoming the Silicon Valley for smart cities.”

“In terms of attracting big companies to look at what’s going on in Spain and to build a bigger brand around the Internet of Things, I think that really helps.”

With government and citizens working together, Alicia sees the Internet of Things delivering great changes to society as it enables citizens and makes governments more accountable.

“It’s the real thing, it’s beyond technology.”

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Can Russia build a Silicon Valley?

Can Russia build its own Silicon Valley in Skolkovo?

Like many other countries, Russia is trying to build its own equivalent of Silicon Valley at Skolkovo on Moscow’s outskirts as Tech Crunch reports.

Across the world governments are trying to find a way to replicate Silicon Valley – from London’s Tech City to Australia’s Digital Sydney, the hope is they can create the same environment that built California’s success.

In some respects, Russia should be well placed to create their own Silicon Valley having had the same massive Cold War technology investments as the United Stated. The old Soviet system also left a deep scientific and mathematics education legacy.

As the Tech Crunch article points out though, the Russian financial and legal systems are working against the nation with most local startups looking at incorporating in offshore havens like Luxembourg and Cyprus rather than taking their chances with the local tax laws and courts.

If finance was the sole criteria for succeeding then Skolkovo would be almost guaranteed success with twenty billion US Dollars of private and government fundiing behind the project.

Funding alone though isn’t enough, and most industrial hubs are the result of happy accidents of transport, natural resources and skills being found in one region.

It might take more than a load of cash for Russia to build their own Silicon Valley, but with a shrinking and aging population the nation needs to find a way to diversify away from simply being an energy exporter.

Image courtesy of Skolkovo Foundation through Flickr

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Can governments save declining cities?

Detroit’s decline illustrates the limits of government powers in the face of economic and historic forces.

Following yesterday’s post on comparing the relative problems of Detroit and the Chinese ghost city of Ordos, The Fiscal Times has a somewhat wistful description of Motor City’s decline by one of the city’s sons, Eric Pianin.

Pianin’s story charts the various attempts to revitalise the city following the disastrous 1967 riots that triggered the middle class and white flight from downtown.

As last week’s events show none of these efforts worked, which begs the question of what governments can do to save cities and regions facing structural decline.

Every city has an economic reason for existing — it could be transport links, natural resources or an industrial cluster. When that reason fades the population moves on.

For Detroit, the high point was the late 1960s as the US motor industry reached its zenith. Through the 1970s the sector languished and was then displaced by smarter, better Japanese competitors.

In the face of this there was little local, state or Federal governments could do. Detroit’s importance, wealth and population were destined to decline as industry left regardless of how much money was spent on grand schemes to revitalise the town.

Perhaps sometimes we just have to accept there are limits to government power and the predicaments of cities like Detroit are the natural course of history.

Over time, it may be Detroit manages to reinvent itself however the city will almost be very different, and smaller, city that it was in its heyday.

View of Detroit Central Terminal Station by Jason Mrachina through Flickr.

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Why Australia is losing the digital race

Despite the best intentions of government, Australia is falling behind in the digital economy. What can the nation’s political leaders do?

This story originally appeared in Business Spectator on 17 June 2013
At the beginning of this century, Melbourne hosted a meeting of the World Economic Forum. Among the visiting luminaries was Microsoft founder Bill Gates who laid out his vision for governments in the digital economy.

“The Government itself needs to become a model user of information technology,” Gates said at the time.

“Literally seeing government work with its citizens, with its businesses will change how we do our taxes, licences, registrations, all these things, on a basis where you don’t have to know the organisation of government and its various departments, you don’t have to stand in line, you don’t have to work with paperwork.”

Last month in Brisbane, the Federal government re-released their Digital Economy Strategy with the ambitious goal to make Australia a “leading digital economy by 2020”. A key part of the strategy is for the government to allow citizens to “fully complete priority services online”.

Thirteen years after Bill Gates articulated the need for governments to move services online – and he was by no means the first person to do so – the Federal government has posted a target to partly achieve this by the end of the decade.

It’s hard to see how achieving such a belated objective will put Australia in a position of leadership in a rapidly changing world, although this is a direct consequence of deliberate decisions made by the nation’s leaders, and society, over the last thirty years.

Thirty years ago the debate on Australia’s position in the global economy resulted in the Hawke government’s Clever Country policies. In many ways, today’s Digital Economy Strategy is an echo of the Labor’s halcyon days under Paul Keating.

Keeping things in perspective

In Sydney on the day before re-releasing the strategy, Minister Conroy channelled Paul Keating in talking about the J-Curve of technology adoption at a lunchtime panel with the Australia Israeli Chamber of Commerce.

Preceding Senator Conroy’s panel was Anna-Maria Arabia, general manager of the Questacon National Science and Technology Centre in Canberra, who described her trip to Israel to look at how the nation that derives 40 per cent of its export incomes from high tech industries is nurturing its technology sector.

Arabia was accompanying Federal minister Bill Shorten and she described a meeting with the chief scientist of the Israeli Ministry of the Economy, Avi Hasson, where Shorten asked him about the success rate of Israeli government research and development projects.

Hasson’s reply was very different to the risk averse response often heard from Australian bureaucrats, ministers and business leaders.

“Had I been told that we enjoyed an 80 per cent success rate I would have concluded the government was investing in the wrong projects,” Hasson is quoted as saying. “Such a success rate would have meant we were investing in low risk projects and, quite frankly, the private sector could have taken care of that.”

The risk-reward equation

In Australia, there is no such vision or appetite for risk. At best the Federal government has announced another review of tax rules and industry support programs while the opposition is vague on its plans to support innovation and R&D should it occupy the Treasury benches later in the year.

While it’s easy – and fair – to criticise both sides of politics, the business sector is equally negligent with its reluctance to invest in research and development while claiming R&D tax credits for projects that are closer to capital improvements rather than real innovation.

Two weeks ago the ABC Business Insiders program had featured an interview between Business Spectator’s Alan Kohler, Dow Chemical CEO Andrew Liveris and Australian Business Council chief Tony Shepherd where they discussed Australia’s role in the modern global economy.

Australian born Liveris, who is also chairman of the US Business Council and sits on the Obama’s board of innovation, said Australia needs a vision building on the country’s strengths.

At present he warns the country is in a state of rigor mortis having “lost the will to innovate.”

Thinking beyond mining

When Gates visited Australia in 2000, he warned that the nation needed to think beyond mining and agriculture and secure a place in the high tech economy.

That warning was disregarded and Australia as a nation made the decision to focus on domestic consumption driven by rising property prices and mining exports.

Reserve Bank of Australia governor Glenn Stevens summed up that national decision in a speech made to the Australian Industry Group in 2010 where he dismissed Bill Gates’ warning about ignoring high tech industries at the beginning at the decade.

“Ten years on, though, it does not seem to have been to Australia’s disadvantage not to have built a massive IT production sector,” Stevens sneered. “On the contrary, the terms of trade are at a 60-year high, the currency just about equals its American counterpart in value and we face an investment build-up in the resources sector that is already larger than that seen in the late 1960s and that will very likely get larger yet.”

Stevens’ speech illustrates the Australia we have today – high-tech industries along with the research, development and innovation are something other countries do.

The vision for Australia being a global leader in the digital economy by 2020 is a laudable and equal to any of the noble objectives proposed in the Gonski education review or the Asian Century report.

Unfortunately to achieve those aims, and to overcome the deliberate national decisions we’ve made over the last thirty years, it’s going to take more than the modest and belated objectives of last week’s re-released Digital Economy Strategy.

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