1. Economic Development: The Killer App For Local Fiber Networks
Jim Baller
Baller Stokes & Lide, PC

2. Overview What is a “Killer App”? What is “Economic Development”?
What Have We Learned About Broadband and Economic Development?
What Are Successful Communities Doing?
What’s Next? The Future of Work

3. What is a “Killer App”?
“[A]ny computer program that is so necessary or desirable that it proves the core value of some larger technology, such as computer hardware, gaming console, software, programming language, software platform, or an operating system. In other words, consumers would buy the (expensive) hardware just to run that application. A killer app can substantially increase sales of the platform on which it runs.” Wikipedia,

4. What is “Economic Development”?
“Economic Development creates the conditions for economic growth and improved quality of life by expanding the capacity of individuals, firms and communities to maximize the use of their talents and skills to support innovation, lower transaction costs and responsibly produce and trade valuable goods and services. Economic Development requires effective, collaborative institutions focused on advancing mutual gain for the public and the private sector. Economic Development is essential to ensuring our economic future.” U.S. Economic Development Administration

5. Economic Development Strategies
Attract or retain a few large employers, or a larger number of smaller employers, or a combination of both
Increase profitability of local businesses, the number or quality of local jobs, or some of each
Support of all local industries, or target particular industries – e.g., high-tech, health care, data centers, etc.
Community vs. regional approaches

6. Common Economic Development Tools
Tax incentives (e.g., TIF, NMTC), “zones” and “districts” of various kinds
Loans, grants, loan guarantees, or other financial incentives
Upgrade infrastructure (roads, sewers, power, fiber, etc.)
Make available attractive, low-cost sites
Accelerate franchises, permits, and other authorizations
Support workforce development and training
Help boost sales via marketing support, demand aggregation, etc.
See Texas Municipal League Economic Development Handbook,

7. Why It’s So Hard to Quantify the Relationship Between Fiber and Economic Development
Still early – limited data base
Circumstances vary widely
Many different kinds of economic “success” (or “failure”)
Fiber only one of several critical factors
Competition varies in and among communities
Corelation v. causation
Many more factors

8. What Have We Learned So Far?
Studies of First-Gen, Low-Capacity Broadband (2005~2015) (NTIA, Gillet, Crandall, Ford, Kolko, Whitacre, SNG, etc.)
At least an association, probably a causal relationship in some situations
More rapid growth in employment, number of businesses, especially IT-related businesses
High levels of adoption in rural areas cause income growth and increase in employment
SNG benchmarking econ impact of small business usage

9. What Have We Learned So Far? (continued)
Studies Focusing on Fiber Networks (2010-current)
Home-based businesses on fiber networks annually add at least $40 Billion to US economy (RVA)
Fiber networks increase property values approximately $5,000-$6,000 on home of $300,000 in US (RVA and several other studies)
Early data suggest that fiber networks increase local GDP more than 1% (Sosa)

10. What Have We Learned So Far? (continued)
Recent RVA study of impact of FTTH on local economies
Compared metro areas that have more than 60% FTTH with metro areas that have less than 25% FTTH
Results:
10-year impact on jobs: 72% better for FTTH cities
10-year impact on gross metropolitan product: 64% better for FTTH cities
10-year impact on business formation: 46% better for FTTH cities

11. What Have We Learned So Far? (continued)
Dr. Bento Lobo’s studies of economic impacts of Chattanooga’s fiber network in Hamilton County, Tennessee
Estimated household, community, business, and utility benefits (e.g., lower communications service bills (incl. from competitors), new investments and jobs, telehealth, telecommuting, increase in venture capital, publicity for community, business efficiency gains, disaster recovery, etc.)
Results: On investment of $195 million, created 2,800-5,200 jobs and $865 million - $1.321 billion in economic benefits

12. What Have We Learned So Far? (continued)
Steve Ross (Broadband Communities) studies of all US Counties for the years 2010 through 2013
Counties in the bottom half of their state rankings for access to 25 Mbps download speeds had a population growth of only 0.27 percent
The top half enjoyed growth of 2.79 percent – more than 10 times greater
Counties in the bottom half of their state rankings added just 134,390 people, and those in the top half added more than 7.2 million

13. What Are Successful Communities Doing?
See “Killer App” paper for 23 examples (
Essential: one or more 24/7 local “champions”
Strong, holistic commitment to success of the community
Extensive and ever expanding knowledge of community
Bold, realistic, and pro-active vision
Extensive research into everything necessary to succeed
Ability to make, articulate, and execute action plans
100% commitment to succeed in face of opposition

14. What’s Next? The Future of Work
Some forms of economic development are better than others
Best ones create work opportunities that enable residents to earn a decent living and feel fulfilled
We’re now in the “Age of Accelerations” – especially given job-threatening artificial intelligence, robotics, and globalization
How will adaptive communities deal with this?

15. Questions?
Jim Baller Baller Stokes & Lide, PC (202)