NC Media Watch

A quest for reason and accuracy in letters to the editor, guest editorials and other issues of interest to the citizens of Western Nevada County.

Tuesday, June 07, 2005

Transition from manufacturing to service economy

As more companies in Western Nevada County transition from manufacturing to services, our leaders need to be aware of the impact this transition could have on the local economy. Services do not generate the level of tax revenues that products do.

Research and development services are an expense, but a necessary part of the business cycle. R&D must create new products to replace the mature products which can become low revenue commodities, often with stiff competition from knock off foreign competitors. That means companies must innovate. They must leverage the services they provide. The global economy is driven by connectivity, providing an opportunity to create levels of service that cannot be matched by competitors.

Tomorrow’s Grass Valley Group, Litton and Telestream are working in their second bedroom, garage and back forty barns to create must have devices and services. However, many lack the broadband connectivity needed to grow in the globally connected economy. Grass Valley, Nevada City and the County must pay more attention to our telecommunication infrastructure weaknesses.

A priority for the ERC, since 2000 when Larry Burkhardt formed the Telecommunications Infrastructure Resource Team, has been to expand broadband connectivity. The ERC has had some success in getting SBC to turn on more DSL remote terminals. In other cases, the ERC encouraged entrepreneurs to development wireless alternatives to DSL which prodded SBC to be come competitive and turn on additional remote terminals. Yet, many home based business still do not have the connectivity need to succeed. The home-based businesses need help from local political leaders. Roseville community leaders worked with Surewest, then Roseville Telephone, to insure that all new business parks had vital fiber optics infrastructure. Surewest is now bringing fiber optics to the home in many neighborhoods. Our city and county leaders shouldd be encouraging SBC and the Comcast to expand broadband services.

Local telecommunication issues that need immediate leadership attention:
New buildings in Whispering Pines Business Park cannot get SBC telephone voice and data circuits. Planners lacked insight into future telecommunications needs. I have no idea what leverage the City can apply, but local developers cannot rent these new buildings without telephone and data services. Empty buildings do not generate much tax revenue.

The Nevada City Central Office (CO) is so stuffed with equipment, there is no room to put the fiber optic distribution systems need to activate DSL remote terminal in the rural neighborhoods. The CO must be expanded or moved to a new location. Expansion in the historical district will be difficult without the cooperation of City Council and the local NIMBY organizations. Moving will require extensive trenching, and the disruption of local businesses. It will also impact city tax revenue, if the new CO is moved outside the city limits. Yet, insuring emerging home based businesses have DSL, or cable broadband, connections are vital to growing a connected service economy. Nevada City leaders should work to eliminate the CO bottleneck as soon as possible.

More details on ERCactivitiess, including a map of current broadband coverage( here).

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