|Monday, February 3, 2014|
|How Did 17 Million Kenyans Exchange $20 Billion Last Year?|
In 2013, the people of Kenya sent each other US$19.6 billion in payments and money transfers. According to Herbert Wattanga, author of Nairobi County’s Smart21 nomination (pictured right), the total of their transactions exceeded Kenya’s national budget by more than $1 billion. And guess what? Not one of those transactions went through a bank. Instead, all of them went through mobile phones.
At ICF, we write a lot about the impact of the broadband revolution on every aspect of our lives, and about the urgent need it creates for cities and regions to adapt to its demands. You would be hard-pressed to find a better example than mobile banking in Kenya – even though it uses a technology many years older than smartphones.
In 2007, a mobile carrier called Safaricom introduced a new money transfer service called M-Pesa. Up to that point, banking in Kenya was largely controlled by foreign banks, which tended to serve only the most affluent Kenyans. Then the central bank rewrote its regulations in an attempt to expand access to financial services. One new regulation allowed mobile operators like Safaricom to provide mobile payments.
Safaricom’s move was meant to be business-as-usual: a new service that would help reduce customer churn. It allowed users to load money onto their phones through the same process they used to prepay for airtime. Money was moved with a simple text message, with each transfer incurring a fee of between $0.25 and $0.70. The money deposited was held, not by banks, but in an independent trust that Safaricom does not control.
Business-as-usual it was not. By 2012, there were 17 million M-Pesa accounts generating nearly US$300 million in fee income for Safaricom. And Safaricom’s success pales in comparison to that of Kenya. With 70 percent of adult Kenyans – and 50% of the poor – using it, The Economist estimates that M-Pesa has boosted national GDP by as much as 25 percent. So popular has the service been that it drove an overall increase in mobile penetration from 49% in 2008 to 77% in 2012 – and greater phone penetration alone has generated $2.4 trillion in economic growth, according to a report by Deloitte (Mobile Telephone and Taxation in Kenya 2011
So if you ever wonder what all the fuss about broadband is really about, M-Pesa offers a clue. Sure, it’s not broadband – but it is a revolution in online applications. It makes clear that the same technology bringing you you cute cat videos and spam in your inbox can profoundly change lives – but only in places that are prepared to seize the benefits technology offers.
|Monday, January 27, 2014|
|Incense Rising – Taichung and the Announcement|
Passion is so much a part of motivation. So is pride. A genuine sense of both filled the massive ballroom in the Millenium Hotel in Taichung last week as I named two new entrants from Taiwan (Hsinchu City & New Taipei City) to the ranks of the world’s Top7. Along with them were named five others from Canada and the USA. As you can see from the news report on FTV News out of Taipei, the place erupted when the names of its two “hometown nation” finalists appeared. (For the record, there was even robust applause for Columbus and Toronto. I learned later that it was coming from people in the room who have an ICF alumni relationship in Columbus, and young people who have lived in Toronto.) The Smart21 also received one more deserved round of applause from a group of 300 community business leaders, academic, students and Mayor Hu’s administration.
It was a moving three days in Taichung. I again saw a community and a nation that few see, or bother to look for when considering Taiwan. For most of the world and the media, it is “All China all the time.” Not here. Not within the Intelligent Community movement. It is my prediction that China may look a lot more like Taichung someday than Taichung will look like China. China is rushing to understand ICF’s “Wisdom Communities,” as they call them. Good for them. Perhaps they too will soon understand what is at the heart of an Intelligent Community: great communities thriving on the construction of creative, clever, open industries and local governance. As Taichung Mayor Hu said in his keynote, “Smart cities do not do foolish things.”
Taichung has certainly not fallen victim to foolishness. At least not yet. Why do I like this place so much? Because it has a soul and, as my father used to say, it knows how to use its head. In my keynote address (titled “Brain Gain: Creating the Cities of the Future with only 1300 grams.”) I quoted tech investor Paul Graham, who said of that California phenomenon, Silicon Valley, that “for all its power, Silicon Valley has a great weakness. It has soul-crushing urban sprawl.” When a money guy like Graham refers to a “soul-crushing” experience I pay attention because it begins to reinforce my belief that a community with creative courage looks at itself as an artist looks at a blank canvas.
In traditional Taiwanese culture incense means longevity. When incense is invoked in art here it is meant to symbolize the extension of today’s efforts into eternity. This was the ancients’ way of suggesting sustainability of purpose and person through good work and a long-range view. When applied to the development of an economy and a community it is the ultimate, unmeasured, distance between a powerful, rich and merely “smart” place, and theTaichungs and Eindhovens, whose wealth will be more rounded but immense.
For sure Taichung has a heart and soul. It is big and deep, and is accelerating into the future a remarkable economic engine hungry for more talent to drive it. Culture is at the heart of the new strategy. Taichung has a Cultural and Creative Industries Park upon which it seeks to “build industries on the foundation of local culture.” It is not mere Party sloganeering either. Yes, I am typing this on an ACER laptop, which was made here in Taiwan, as are at least 70% of the world’s notebooks. And yes, Taichung is a monstrously successful manufacturer of precision machinery of the high-tech kind. And yes, the real estate industry, which underwrote the Top7 Day events here is booming, and there is no end to the potential of this place. You cannot go three minutes in either direction without seeing construction. People are getting rich here – but not flashing it. And yes, they continue to create more wealth. They are proud of that and loving it. They are also developing another type of wealth that is at the heart of civilization and essential to sustainability.
That “wealth” is made from a community which has a policy for excavating, innovating upon and using ICT to nurture local culture. This is the big idea here. Taiwan president Ma must have heard my father’s phrase because during a recent trip to Africa, Mr. Ma (former Mayor of Taipei) told his guests that despite a lack of natural resources, “we in Taiwan dig into our brains.” The story of Taichung’s success is about that. It is a new idea that has persisted her for nearly ten years. It places dual emphasis on culture mining and environmental stewardship. Its Calligraphy Greenway project won the first prize in the LivCom Awards program in, of all places, China. The project has transformed an entire swath of the city.
During the Top7 Announcement dinner, a really hot jazz band with an unusual number of saxophones was blowing away. Why so many saxes, I asked? I learned that Taichung is the world’s largest exporter of jazz saxophones, which they produce for private label brands worldwide. Industrial output of this type is a part of the overall strategy. This jazz was also reflective of the fact that a lot creative riffing is going on. Some of it is massive. Taichung is rushing to complete a new opera house, the brainchild of Mayor Jason Hu and the famed Japanese architect Toyo Ito. It will be the most physically interesting place in Asia to watch people die dramatic deaths, courtesy of the genius of Italian composers! It is also an ode to the future of democracy. Like the idea behind New York’s Central Park, its massive outdoor park and public spaces within are odes to a place emerging as a strong democracy. Democracy and a sense of fairness have taken root, and the result is a fusion of East and West at its best. What a place!
American columnist Thomas Friedman has written that with the exception of the USA, Taiwan is his favorite country. I get it. Among the many places I comfortably call “home” among the 126 Intelligent Communities of the world , this place, Taichung, has a special place in my heart. I am happy for them. The “Mechanical Kingdom” has become the Kingdom of the Intelligent Community.
As the Year of the Horse races toward Asia, we acknowledge seven communities, two from tiny Taiwan, who are out of the gate and running toward the 21st Century by using ICT and, yes, heart and soul to let their incense continue to rise. Good luck to them all - and thank you again, Taichung!
|Tuesday, January 21, 2014|
|City-Building Advances with Technology|
People have built their villages, towns and cities for thousands of years. Early signs of construction of shelter date back to over 500 thousand years. Technology transformed these settlements - from the invention of fire and the wheel leading ultimately to applications of the steam engine; and from the advent of the automobile to the adoption of the Internet in everyday life of people around the world today. Technology, whether by revolutionary invention or as everyday innovation, has continuously transformed communities and will continue to do so for eons to come. However given the technology available to us today, it is highly likely that we will see incredible changes ahead in our cities in a shorter period of time than previous decades and centuries. This makes it all the more important for decision-makers, urban and regional planners, architects, economic development officials and engineers to play a more important role in engaging everyday end users through the use of technology and together to embrace advances in technology to create the most efficient, safe and culturally rich communities possible around the world. Every village, town and city should ask themselves if they are doing this for the betterment of their community and if not, it is essential for them to find the ways in which they can.
The use of sophisticated computers, availability of affordable high speed broadband, mobile applications, advanced software and entirely new approaches to how things should be done, mixed with technology savvy and highly trained knowledge workers makes it possible to witness a perfect storm in the works, ensuring community-wide transformation to occur. However for many communities, the way healthcare services are provided and municipal services are delivered, such as administering zoning and building bylaws, community participation practices and development services in the most traditional of ways, would suggest that they have not kept up with available technological and procedural advances. Municipal planners, economic developers and decision makers need to advocate for community wide acceptance of new approaches to undertaking our city-building of the future, today.
For instance, in the last decade there has been considerable innovation at the intersection of urban planning and technology. Availability of open data, especially where government data has been made available for others to access and use has been a major catalyst, as well as practices such as social networking opportunities, crowdsourcing and GIS-based advanced mapping applications. New approaches to including civic participation and building on sustainable communities initiatives, programs based on asset management technologies, also referred to as smart cities, and programs involving more holistic intelligent community initiatives focusing the work of ultra-high speed broadband in community development make this an exceptionally exciting time to be involved in the urban planning environment.
Technology and future city-building initiatives are now hot topics at conferences and trade shows; on the lips of civic officials learning about neighbouring communities having benefitted from an asset management exercise with a friendly technology vendor; and as part of competing regions rolling out massive programs to ensure the efficiency, sustainability or attractiveness of their community to attract investment or talent to their community.
To ensure that our cities are being planned to transform in the way that will best benefit our current and future citizens, urban planners and their colleagues in the architecture, economic development and engineering fields, as well as politicians in city councils, must be open to adopting and investing in technology and new techniques beyond incorporating computers and flat screen monitors in Council Chambers. For instance, “asset managers” in Cambridge Ontario worked with IBM to become the first “Smarter Planet community” to use routers and other data management tools and processes to monitor city infrastructure which has helped the city to more efficiently service their citizens and plan for their infrastructure and maintenance budgets.
In architecture, infrastructure development and engineering design, technology has transformed its boundaries. Using digital technology permits complex calculations to assist in creating complex forms, increasing the possibilities in architectural design that has benefits far beyond the building use itself. For example Frank Gehry designed the Guggenheim Museum in Bilbao and Disney Concert Hall in Los Angeles, among others, using a design process similar to that used to design Mirage jet fighters from conceptualization through to manufacturing. Other architects and design engineers are using advanced computations and design technologies to create new ways to design and implement their creations and ensure the safety of the designs, especially as lighter, thinner materials are being used. But the benefits are more than about the buildings themselves. They evoke excitement and dynamic possibilities about their community that attracts investment, tourists and talent, such as has evolved in Bilbao since the Guggenheim Museum was created. It inspires others to be part of a community that thinks beyond the banal and conventional and as a result is a strong advocate and tool for attracting and retaining key resources in their community, the talent and human resources that come together in civil societies around the world and have options to move to where the best opportunities exist. This has been referred to as the stickiness of a city to be able to retain the investment and talent that it initially grew or attracted. Excellence in urban design, architecture and planning can make the difference between a dynamic and well regarded community that everyone would want to live in and one that experiences annual brain drain and investment exodus.
Technology in infrastructure and civic design are extremely important applications, but so too are communications and civic approval processes involving the everyday citizens of a city. For instance, in Brazil, the State of Rio Grande do Sul pursued a web-based “policy crowdsourcing initiative” in which citizens were invited to co-design solutions to address health challenges in the state. Through the use of technology the state received over 1,300 proposals, resulting in more than 120,000 votes on the prioritization of these different proposals. Normally initiatives facilitated by technology have been characterized by relatively low response in terms of citizen engagement, but this example demonstrates a change in how people are beginning to accept technology in urban planning practices.
The City of Melbourne's strategic city planning process is another example where technology has aided in the development of a dynamic, real time process to help reengineer their planning process through the use of a wiki permitting broader public participation. Much like what people today experience through active involvement with Wikipedia, Melbourne’s plan called “Future Melbourne” is designed to permit anyone to edit it. In other jurisdictions graphic modeling is used to explore options to define building intensification or the shape of buildings to ameliorate negative wind and sun conditions. Experiments in civic design using monitoring equipment and video also help planners to design better spaces, places and urban experiences. The ubiquitous piano stairs experience is not only fun but helps planners to better understand how people relate to urban form and movement systems. Others experiment with technology to create unique lighting designs and messages on buildings and through projections onto mountains.
Technology in these communities has ventured beyond the banal and everyday use to exploring new meaning and opportunities, adding to a new kind of exciting ecosystem for the community. For instance, in Chattanooga, Tennessee, the use of ultra-high-speed broadband is not only able to transfer large amounts of data and video, it aids in creating exciting new ecosystems, attracting investment and retaining talent. Chattanooga’s Electric Power Board (EPB) created North America’s first Gigabit city, which has helped to attract such major investments as Amazon’s key distribution center, major insurance employers, major logics firms and even a highly sought after advanced robotics-based Volkswagen assembly plant. Chattanooga’s EPB deliberately installed high speed communications infrastructure to enable economic development success while delivering government services for transit, public safety, public works and education. And the EPB didn’t just build a fiber network for basic business and residential Internet connections. It was the backing of its entire electric utility, making it possible to offer gigabit services at affordable prices for those that needed it. It also built the system to be differentiated by offering fully symmetrical services – with both a gigabit up and gigabit download speed. With this capability, radiologists in Chattanooga built their own application so that they could view digitized scans wherever and whenever they needed to. Without a fully symmetrical network, these kinds of applications could not have been dreamed of.
Chattanooga didn’t just focus on attracting the big employers either; they created an ecosystem that benefits both big and small employers and encouraged a climate of homegrown entrepreneurial efforts that attracted and retained smart, tech-savvy people such as through their Demo Day experience. Through clever marketing and access to advanced technologies, several tech companies agreed to move to the city. Chattanooga also works closely with the University of Tennessee, which established a supercomputing center and a non-profit commercialization entity that licenses the technologies developed by its students and professors. Even the city now uses many of their applications, such as in disaster management and large-scale urban planning simulations.
According to former Chattanooga Mayor Ron Littlefield: “Don't rule out many unexpected benefits (of the use of technology in city-building). We got into robotics and energy development when they were popular many years ago. But our fiber network is like having the first city that discovered fire.” Accordingly, Chattanooga is just beginning to see benefits from its Gigabit environment.
Likewise Toronto’s waterfront is being redeveloped as an Intelligent Waterfront focused on its Gigabit environment as well. A new Innovation Center will be a focal point of the redevelopment blending built form, technology and new uses and applications for the city and region. The Pan Am Games next year in Toronto’s waterfront will expand new applications that will also attract investment and talent for years to come.
|Monday, January 13, 2014|
|"You Will Never Stop Building Towers"|
Stockholm has done it. So has Dublin, Ohio and the entire nation of Australia. Next on the list: Lac Ste. Ann County?
In December, I was in western Canada providing the services of our Community Accelerator program to the government of Parkland County, Alberta, which is on the 2014 list of the Smart21 Communities of the Year. Parkland County is a municipal district, which is a fairly common form of government in the sparsely populated province of Alberta. With a population of 30,000, it has an average density of 32 people per square mile or 13 people per km². We’re talking rural.
I was there to address gatherings of citizens and small business owners in village halls, the traditional centers of village life that are being transformed into digital hubs thanks to Parkland County’s infrastructure of wireless towers. The county has not gone into the telecoms business: rather, it has built a network of towers, capitalized by grant funding, for wireless ISPs, mobile carriers and first-responder networks to equip with radios. By building the utility-grade towers and interconnecting them with fiber, the county is drastically reducing companies’ cost of entry for serving new markets – in particular, low-density areas where a for-profit carrier would otherwise find it impossible to turn a profit. The towers are already generating rental income and within a couple of years, will provide enough cash flow to fund continued operation and upgrade, while enabling the private sector to serve customers who would normally be on the wrong side of the digital divide.
It’s called open access, and it has worked in many cities and suburbs. Parkland County is bringing the strategy to a rural place, and doing it with a mix of caution and daring – always with an eye on the bottom line – that are the hallmarks of successful community network deployment.
Part of that strategy involves helping surrounding counties and municipalities do the same thing. The bigger the total network, the greater efficiencies Parkland County and its partners should enjoy, and the more leverage they will have with hardware, software and service providers. So, one of my stops was in the City Council chambers of Lac Ste. Anne County, to the north of Parkland.
We’re talking way rural here: 3.6 people per km2. The Council was deliberating an investment in a few towers that would bring them into the Parkland County network, and members were concerned about the kinds of things Councils should worry about. Would the investment lose money? Would changes in technology make towers obsolete? Would voters get upset to see towers rising on the horizon? Al McCully of Parkland County and the network designer, Allan Bly, answered their questions. Bly stressed the work that Parkland County had put into standardizing its tower designs, which eliminates the need for specialized antenna contractors and reduces long-term costs.
Then he said something that every Intelligent Community should keep in mind when considering its broadband destiny.
He cautioned that their decision was not a one-time thing but a first step. Once people get a taste of real broadband, he said, “you will never stop building towers.”
He was right. When Intelligent Communities contemplate creating networks, all attention goes to that first, white-knuckle decision: do we or don’t we? How will the private sector respond? Will voters really be behind this or will there be a backlash after the inevitable problems arise? Are we really able to pull this off?
But once you enter the business of broadband infrastructure, you will always be in that business, just as you will always be in the business of maintaining roads and sidewalks, picking up garbage and fixing streetlights. These are good businesses to be in, because they make your city or county a better place to live, work, start a business and raise the next generation. And that’s why local government exists, isn’t it?
Photo credit: Steve Nagy
|Tuesday, December 31, 2013|
|Success the Crooked Way|
In eight hours 2014 arrives. People have begun to elevate to the point of hysteria their claims for it to be a “new start.” Rather than act in the moment, while it is still 31 December, most figure it best to begin tomorrow morning, or perhaps afternoon. I wish them well. While the future is being eagerly fantasized over, the year 2013 is being obsessively analyzed, and first drafts of its place in history are being posted digitally, tweeted endlessly and chatted about on TV as if one stroke after Midnight makes them a tidy conclusion. Linear thinking. Who needs it?
In New York City, where I am celebrating this evening, a new mayor prepares to take office and “make the city better,” while a departing Mayor, Michael Bloomberg (whose kind words helped the Intelligent Community Forum establish credibility in New York ten years ago), claims that during his tenure the city was made better. Americans are a restless bunch.
As you know, success in a city or a community is never assured. In the end success ultimately depends on factors that evolve from collaboration, daring leadership and the ability to make programs works and ideas believable. This is the age of the civic experiment and the community is a canvas and a lab. As we head toward the selection of our next group of the world’s seven most representative communities for the future, Intelligent Communities are right smack in the center of the innovations that are taking place at the local level. What will be the outcome? I believe it will be more successes shaped around our five criteria and the realization that most problems begin and end in the place we call “home.” No need to travel to find trouble. Just look inside, as the Buddhists say. Of course in the final analysis a confluence of events that we call dumb Luck are factors we must also weigh into the mix. There may be more wisdom in China than thought, as it is a place where people pray for luck and let hard work and the pursuit of economic success help guide It along.
Guiding luck toward success is tricky business. President Toomas H. Ilves of Estonia pointed out recently that if his nation, whose phone system in 1993 was literally one from 1938, had taken Finland’s offer of a free analog system from the late 1970’s, things would be far different in places such as its capital and five-time Top7 Intelligent Community, Tallinn.
But Ilves said no. “We do not want to get stuck with 1979 technology” (especially not in 1993), he told his citizens. It is better to take a leap and go straight to the most modern technology.” The decision was taken and it was followed by success of a type others now envy and study. Before Skype was purchased for US$8.5 billion, it was dreamed of in Estonia. Tallinn, because of its Intelligent Community status, is today mentioned in the same breath as entrepreneurial communities such as London, Silicon Valley and Eindhoven. On a per capita basis, Estonia generates as many start-ups as the USA. How long does it take to start a business in Tallinn or any part of Estonia thanks to its digital infrastructure? 18 seconds. (Try that with a Communist-inspired network.)
But the discussion we will have after Midnight is increasingly NOT about technology. The fact remains that you can define success in three words: we want it. We want it very bad. We want it so we can find ways to build better places, rationalize our investments and our decisions to live in that place; to improve the cities in which we live and to go forward confidently in the knowledge that where we stop is reachable by following a path built from our hopes and not our fears. “Help us,” a common prayer says in petition, “to walk a walk of faith and not of fear.”
We have found a way to get there, and the Intelligent Community Forum will keep the path open. In a few days, I will speak about this new horizon for cities in a place that has taught me much about the subject, Eindhoven, The Netherlands. Its motto, “creating the industries of the future,” is where the train to community thinking can begin.
The future of Place, that is of local economies and OUR HOMES, depends on the degree to which we manage two things: our ability to create not merely jobs, which churn fast and vanish, but industries that thrive and define us. The future will be shaped around another type of success that we often ignore: the success of our ideas. We understand that true growth – the real seeds of life – come from each individual pursuing personal growth. This means liberty. This means a free gymnasium for the exercise of conscience. This means creativity at the center of life. The fact that in 2010 the first synthetic organism was produced is not a metric that economists or governments will look at as the evolution of an industry – or industries. But it is all of that. Everyone spoke endlessly about “jobs” in 2013. In 2014, as you will discover, the new Top7 and ICF will be talking about new industries. My keynote in Eindhoven will start the year on this path and it will be followed by a gathering in the reigning Intelligent Community of the Year, Taichung. In Taichung, as the Top7 will be named in the city that has married industries to universities to government. If you attend the city will show you on 22 January how it is done. Contact us for more details.
Will it all roll-up neatly into a package, or arc upward in a straight line? Hell no. When did it ever, except after several drinks on the last day of a year when our nostalgia got the best of us. Now, it nearly Midnight. Friends and community are waiting. It is time to have those drinks, enjoy the possibilities, and tomorrow get on the path forward.
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