Broadband development led by city to open economy to the globe.
The city of Stockholm stands on fourteen islands on Sweden's south-central east coast. According to legend, the city's name tells you how it was born: as a fortress made of logs ("stock") on an island (“holm”) guarding the entrance to lake Mälaren. Stockholm has been Sweden´s political, cultural and economic center since the 1200s.
Sweden has charted its own economic and political course throughout the 20th Century. Stockholm was spared the destruction of two world wars and saw its economy boom in the post-war years, when Sweden instituted very high levels of social spending that consumed almost 50% of GDP in taxes. The bursting of a real estate bubble in the early Nineties caused a severe economic crisis, in which employment fell 10% and a run on the currency forced the Central Bank to briefly raise interest rates as high as 500% in an unsuccessful effort to defend a fixed exchange rate. In 1994, with a budget deficit exceeding 15% of GDP, the national government instituted multiple reforms and slashed spending to put its financial house in order. The result was to strike a new and apparently sustainable balance between cradle-to-grave social benefits for citizens and strong economic growth based on knowledge, creativity and innovation.
One out of every eleven Swedes lives in Stockholm, and in the first decade of the new century, their city has continued to find way to make "big" work better. The economy benefits enormously from Stockholm's status as the political and cultural capital. Most of the country's head offices and one in three foreign-owned companies are located there. Nearly one in three new Swedish companies is located in the county of which Stockholm is the capital. Education levels are high (51% of Stockholmers have studied at university levels compared with 35% nationwide) and average salaries are proportionally higher. By law, Swedish cities must deal with everything from childcare to the burial of a person, though in practice, much of the work is outsourced to private companies. The City of Stockholm is one of Sweden's biggest employers, with 42,000 employees (one for every 19 citizens) and a budget of 37.4 billion kronor (3.9bn Euros or US$4.6bn). Its efficiency and effectiveness inevitably go a long way toward determining the economic competitiveness of the city.
The Stokab Model
During the early Nineties crisis, the City of Stockholm decided to pursue an unusual model in telecommunications. The city-owned company Stokab started in 1994 to build a fiber-optic network throughout the municipality as a level playing field for all operators. Stokab dug up the streets once to install conduit and run fiber, closed them up, and began offering dark fiber capacity to carriers for less than it would cost them to install it themselves. Today, the 1.2 million kilometer (720,000-mile) network has more than 90 operators and 450 enterprises as primary customers and is now in the final year of a three-year project to bring fiber to 100% of public housing, which is expected to add 95,000 households to the network. Stockholm's Mayor has set a goal of connecting 90% of all households to fiber by 2012.
As an information utility, the Stokab network has become an engine for driving efficiency in every aspect of government. The City's Web site hosts a huge range of applications through which citizens can request and receive service online, from applying for social housing for the elderly to a schools portal that facilitates collaboration among students, teachers, school administrators and parents or guardians. Over 95% of renters use the housing department's portal to find apartments, and the library portal provides online access to the content of 44 individual libraries. After pilot projects in 2005, the city has also instituted a contact center to handle inquiries and complaints from offline citizens and to support users of e-services. There is a special telephone line for the elderly to call.
Much of the efficiency gain happens inside the walls of government offices. Stockholm uses a Web-based tool to manage its operations at all levels from the Municipal Assembly to schools and housing for the elderly. The system aims to automate routine administrative tasks, such as accounts payable and applying for vacation time, and encourage collaboration across agencies. Citizens can follow City Council meetings through Internet video, Internet radio and broadcast radio, as well as having online access to the minutes and documents of each meeting. The city is investing about 650 million kronor (59m Euros or US$72.2m) in developing the various services and in using IT to reduce operating costs and improve citizen services. To prevent redundant investments, Stockholm has introduced a coordination program through which agencies apply for funding for e-service projects from a central office.
In 2007, the City of Stockholm published Vision 2030, identifying the key characteristics the city aimed to have by that year. In 2030, according to the plan, Stockholm would be a world-class metropolis offering a rich urban living experience, the center of an internationally competitive innovation region, and a place where citizens enjoyed a broad range of high-quality, cost-effective social services. All employees of the city receive online training three times per year on the goals of the program and the changing nature of their responsibilities. The city also uses Web-based tools to track progress toward its goals and publishes good examples on the city-wide intranet to inspire others.
For over a century, Sweden has been an export economy. Timber, iron ore and hydropower remain important exports but 50% of Sweden's output now comes from its engineering sector, including telecom, automobiles and pharmaceuticals. These are the industries in which Stockholm leads. The big pharmaceutical company AstraZenica manages its global life sciences research in the Stockholm region. ABB, a global leader in automation and robotics, has R&D facilities in nearby Vasteras (a 2006 Smart21 Community). Ericsson, one of the biggest names in network equipment and related services, does most of its R&D in Stockholm's Kista Science City.
Kista got its start in the mid-Seventies as a mixed-use satellite city combining workplaces and apartments. Several companies including Ericsson and IBM placed factories or facilities there, and small to mid-size companies began locating there to gain access to them. In 1985, the City of Stockholm decided that Kista needed more active management and brought together stakeholders, companies and universities in a non-profit foundation to encourage knowledge transfer. This motivated several research institutes to start operations there, including a branch of the Royal Institute of Technology and the computer-science school of the University of Stockholm. As the ICT cluster gained momentum, Stockholm created the Kista Science City Company and the Stockholm Innovation and Growth (STING) incubator. Today, about 31,000 people work in Kista Science City, which houses 1,400 different companies of all sizes. WIRED Magazine, in a review of technology clusters around the world, ranked Kista second, beaten only by Silicon Valley.
In addition to Kista, Stockholm economic development efforts focus on its life sciences cluster, ranked third in Europe, and on its clean tech industry, consisting of 2,700 companies with annual export growth of 16%.
City government is a significant customer for clean tech, currently investing 1.7 billion kronor (160m Euros or US$207m) in energy-efficiency equipment. This has been characteristic of Stockholm since the mid-1990s. City government believes in making big investments of money, resources and time in the economy and society without neglecting the need to make sure that "big" continues to get better. On February 23, 2009 the City of Stockholm was appointed the first Green Capital of Europe by the European Commission. Stockholm was appointed for its holistic vision that combines growth with sustainable development and includes the ambitious target of becoming independent of fossil fuels by 2050.
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Labor Force: 442,500
Intelligent Community of the Year 2009
This manufacturing center and naval base responded to economic stagnation by building a competitor-neutral broadband network, which stimulated strong growth in broadband services and penetration (+50%), with a wireless system now under development.
The Municipality of Jönköping lies midway between Stockholm and the southern coastal city of Malmo. It is made up of 16 smaller cities, of which the city of Jönköping, with 84,000 people, is by far the largest. The remaining 48,000 citizens are spread across more than 500 square kilometers (190 square miles) of countryside. Its economic legacy is in forest products – the Jönköping exhibition center is home to the world’s largest forestry fair – but that same facility also hosts the world’s largest LAN party as well as the DreamHack events.
90% Broadband Availability
Bridging urban and rural, Jönköping faces the broadband infrastructure challenges common to such places. DSL is accessible to all, but speeds and quality of service vary widely. Jönköping is investing alongside national government to push high-speed networks beyond the urban clusters and provide 90% of companies and households with access by 2020.
Building a Knowledge Workforce
On that foundation, Jönköping is seeking to muster its human and business resources to accelerate the economy and ensure sustainability throughout its territory. The municipality is home to Jönköping University, which offers business-oriented programs at the undergraduate and graduate level. But the municipality also struggles with drop-outs who lack the skills to succeed in the modern economy. A program called Youth Arena targets young people who have dropped out of secondary school. It aims to coach and motivate them to finish their education and then find rewarding jobs in the municipality. Since 2001, Youth Arena has worked with 800 cases and provided individual coaching to more than 230, of whom 70% have gone on to further education or work.
The Innovation Runway project provides the same kind of support to companies. It coaches business owners and managers on innovation strategy and product and service development, and encourages spin-out of new companies. Launched in 2015, the program has already led to the formation of a new company providing digitized construction drawing services.
The Factory is a new program of the public library system that, inspired by the MakerSpace and CoderDojo movements, aims to build a bridge between traditional education and new creative forms of expression. It has introduced personal development courses, coding workshops and presentations on digital technology and culture.
With these projects, and a sustainability plan that will reduce its children’s exposure to hazardous chemicals in everyday use, Jönköping is pursuing a future that borrows from the new-economy prosperity of that start-up capital, Stockholm, while preserving its proud history as a trade center for Sweden’s natural wealth.
The newest district and community in Sweden, Hammarby Sjostad has incorporated “future proofing” principles based on ICF’s vision. It boasts the first broadband network in Europe to be “Access Directive” compliant under new EU rules.
Spain's second largest city, Barcelona is a financial, tourist, exhibition and cultural center on the Mediterranean coast. In this city, tech-based innovation has a physical address: [email protected], a digital district that is the home of a series of projects uniting business, the university sector and government to create economic growth and improve the city's quality of life. Aiming to regenerate an old industrial zone known as the "Catalan Manchester," the city created [email protected] to house its growing information and communications technology cluster, which includes global brands like HP, IBM and Fujitsu as well as homegrown innovators. To lay the foundation, city government blanketed much of Barcelona with a WiFi mesh to run city services and deliver Internet access to citizens and businesses. Within the district, the city began piloting technologies from charging stations for electric vehicles to fiber to the premise. [email protected] is home to Barcelona's business incubator, called Media TIC, which also houses the "Cibernarium," an education center that has provided digital literacy training to nearly half a million citizens over the past 10 years. Going one step further, a project called Virtual Memories engages secondary school students to develop multimedia projects in collaboration with elderly citizens, preserving their memories while introducing them to the potential of digital technologies. Barcelona is also using ICT to bring citizens new ways to become involved in civic life, from digital signs displaying text messages submitted by residents to a "Fix My Street" open data initiative that uses online reporting by citizens to set priorities for public works. With this range of projects, Barcelona aims to create an environment where the world's most innovative companies will feel right at home.
Using digital technologies to leverage traditional strengths in tourism and food production.
This inland community, bordering Spain, has suffered the fate of many small, rural communities. As young people left in search of opportunity, its population gradually shrank and its economic base eroded. Tourism based on its 500-year history became Castelo de Vide’s most important industry, but the community was hard-pressed to compete with coastal cities and towns to the west. To create a sustainable future, the city decided to re-connect its economy to the world. It developed a wireless broadband network to serve businesses, citizens and tourists and put its municipal IT “into the cloud” to reduce costs and expand capabilities. This new infrastructure has made the community more attractive to residents from nearby cities who seek a higher quality of life. Castelo de Vide has also succeeded in attracting numerous film and television productions, which can take advantage of its unspoiled beauty while remaining connected to the network. The city’s newest project is the City of Books, which will provide local booksellers with an online sales portal while providing a hub for Portuguese and Spanish publishers to distribute their products and build an audience.
The Eindhoven Region, south of Amsterdam, is a very successful place. Officially designated in Dutch as Samenverkingsverband Regio Eindhoven (SRE), the region has long been the industrial center of Holland, with 730,000 inhabitants and a workforce of 400,000. Its major cities are Eindhoven (pop. 212,000), Helmond (88,000) and Veldhoven (43,000).
Eindhoven generates €24 billion of GDP and €55 billion in exports, one-quarter of the Dutch total. It absorbs 36% of all private Dutch R&D spending and is home to globally recognized companies including Philips, the healthcare, lighting and consumer product giant, and ASML, maker of photolithography equipment for the production of silicon chips. Eighteen percent of all Dutch automotive jobs are in Eindhoven, and nine percent of all life technology employment. The Eindhoven University of Technology, with more than 7,000 students, is considered one of the top three research universities in Europe. The High Tech Campus Eindhoven founded by Philips houses over 80 companies employing another 7,000 residents.
Yet the region faces major challenges, and its ability to rise to them will determine whether its success can continue.
Eindhoven is a manufacturing center in a high-cost country. By focusing on producing high-value, technology-based products, it is in competition with fast-growing manufacturing centers in nations with much lower costs. Many are striving mightily to perfect the complex manufacturing capabilities that have made Eindhoven successful, which creates unceasing pressure for the region to boost productivity. Foreign competitors are also seeking to raise their own game in R&D and knowledge creation, and Eindhoven, which generates 50% of all Dutch patents, needs to stay ahead of the curve.
At the same time, however, Eindhoven is saddled with Europe’s demographics, in which a low birth rate and aging population is reducing the regional labor force. To win the battle for the talent that provides its competitive advantage, the region must make itself economically and socially attractive to knowledge workers from around the world.
The Brainport Model
Eindhoven’s answer to these challenges is a public-private partnership called Brainport Development (www.brainport.nl). Its members include employers, research institutes, the Chamber of Commerce, the SRE, leading universities and the governments of the region’s three largest cities. A small professional staff meets regularly with stakeholders to identify their strengths, needs and objectives, then looks for opportunities for them to collaborate on business, social or cultural goals. Any stakeholder of Brainport has the opportunity to create new initiatives or partner with other stakeholders. Their work is based on a strategic plan called Brainport Navigator 2013 (with a 2020 version in the works funded in part by the Dutch government). It calls for focusing on five key areas for development: life technologies, automotive, high-tech systems, design and food & nutrition.
It sounds simple enough, and little different from strategies and collaboration groups at work in cities and regions around the globe. It could even be derided as a “talking shop” in which endless meetings take the place of action. But that would be a mistake.
Take healthcare. The region already has about 825 businesses active in the health sector, which employ 17,000 people. To drive further growth, Brainport created a project called Brainport Health Innovation (BHI). Its goals are to foster increased well-being for the elderly and chronically ill, to reduce healthcare costs and increase productivity, and to do so while generating economic opportunities for the region.
The total cost of regional healthcare is forecast to rise from €17bn now to €25bn by 2020, in large part because of the need for 100,000 new healthcare workers to meet demand. BHI’s conservative goal is to improve productivity by 1 percent per year, which would reduce demand for new personnel by 25,000 and save about €750 million. Meanwhile, BHI’s work expects to generate 150 new companies employing at least 10,000 people. It is a conscious effort to reduce employment demand in one area in order to increase it in another, where the region as a whole can benefit more.
BHI has involved hospitals, insurance companies, technology manufacturers local government and individual patients to design and implement realistic technology solutions that offer a profitable operating model. In the works are the Living Lab eHealth project, in which aging people test new services and products introduced by the BHI participants, including remote monitoring and diagnosis over broadband.
A Care Circles project aims to more efficiently share capacity among providers for home care of the elderly and disabled. The longer such patients can be cared for at home, the happier they generally are and the lower the costs of their care. The nighttime hours represent the biggest challenge to home care. Through Care Circles, all calls go to a central dispatch, which matches the location to the partner organization closes to the patient. The result is better quality and availability of care at a lower total cost.
Track Record in Collaboration
Some partnering, some pre-commercial testing, some cost-sharing – at first glance, the BHI projects sound worthy but hardly enough to light up the night. But that is the Brainport method. Bring together the players from business, government, institutions and citizens groups. Figure out specific projects on which they can cooperate for clear mutual benefit. Then manage the projects carefully until they produce results and gain the ability to become self-sustaining.
The range of Brainport projects is extraordinarily wide. The Automative Technology Center involves 125 organizations in collaborative projects that, from 2005 to 2008, generated €4.5m in new investment. The start-up of new high-tech systems and ICT companies is stimulated by incubators with names like Catalyst, Beta II and the Device Process Building.
Design Connection Brainport manages a wide range of projects in design and technology, in order to encourage the industrial design expertise that is as essential as information technology to all of the SRE’s industrial clusters.
Paradigit is a systems integrator founded in a university dormitory that built a fast-growing business producing build-to-order PCs and name-brand systems. Through membership in Brainport, the company identified an opportunity that turned into a program called SKOOL. This program pro-vides over 800 Dutch primary schools with a combination of hardware and software that vastly simplifies the integration of information technology into education. Students receive SKOOL laptops from Paradigit. When students start up the laptops for the first time, the systems automatically connect to the SKOOL server, download all of the applications specified for that school and configure themselves. SKOOL provides remote management of all servers and PCs at its client schools, as well as an online interface for students and teachers to communicate and share content securely. So "bullet-proof" are the hardware and software that SKOOL's technical support department consists of just three people.
The Taskforce Technology, Education and Employment program (abbreviated TTOA in Dutch) focuses on promoting the interest of young people in engineering, attracting foreign knowledge workers, career counseling and lifelong learning. A project called Technific has created an award-winning game called Medical Investigators, in which the student is an investigator accused of committing a crime. His goal is to prove his innocence by collecting evidence throughout the game using an electron microscope, infrared equipment and DNA testing. Each completed experiment helps the students advance to the next level. Another 1,500 kids take part in BrainTrigger, in which they work with local companies to develop innovative solutions in the fields of sustainability, mobility, safety and health.
Responding to Crisis
As the financial crisis gripped the region, TTOA funded research projects for more than 2,000 workers who faced layoffs in order to preserve their skills until the economy recovered. An additional €670,000 went to retraining personnel within businesses. A Dutch entrepreneurs organization identified Helmond, the SRE’s second largest city, as offering the Netherland’s best response to economic crisis.
TTOA also goes on the road to international career fairs in the US, Europe, Turkey, India and China to promote opportunities in the Eindhoven region. Its Expatguideholland.com Web site provides information and services to smooth the path of highly-skilled immigrants and their families.
Information and communications technologies are also brought to bear on creating a quality of life that attracts and retains the digitally literate. Digital City Eindhoven attracts a half-million visitors monthly to a Web-based social media tool that encourages residents to learn more about the region. A WMO Portal involves 20 organizations in answering resident questions on health care, social services and housing. Bestuuronline puts political meetings in the city of Eindhoven online, while Virtual Helmond involves residents of that city in decision-making about planning, building designs and street furniture.
An online game called SenseOfTheCity allows anyone with a GPS-equipped mobile phone to create a personal map of the city and identify what they like best and least. A 12-day festival called STRP, which attracts 225,000 visitors, features music, film, live performances, interactive art, light art and robotics. GLOW is another festival that celebrates Eindhoven's history as home to the Phillips lighting division. The center of the city of Eindhoven is transformed for 10 days into an open-air museum of design in light, much of it interactive, for 65,000 visitors.
The Enabling Infrastructure
The most long-standing innovation projects of Brainport and the SRE concern broadband. From 1999 to 2005, the Dutch government funded a pilot program called Kenniswijk (“Knowledge City”) to subsidize installation of fiber to the home. The program ended after connecting 15,000 homes, but it was followed by a classic Brainport project: Be-linked, which brought together companies, institutions, social organizations, governments and residents to promote broadband deployment and applications. Over the ensuing years, it has stimulated a remarkable range of activity.
A commercial provider, Reggefiber, has aggressively expanded in municipalities where at least 40% of residents commit to taking service. It is now serving more than 230,000 households. Eight industrial parks, backed by loan guarantees from the city of Eindhoven, have installed their own fiber networks. The City of Eindhoven has offered its 100+ schools service on a fiber network at low fixed costs, as well as help in using it streamline management processes and improve teaching outcomes.
A nonprofit Eindhoven Fiber eXchange Foundation, established by the city of Eindhoven and the Eindhoven University of Technology, interconnects service providers throughout the region to let them make the most efficient use of assets. Its members include a broadband consortium of 21 social organizations, which share their own networks through the exchange. In 2010, eight of the region’s 21 municipalities set up a €2.4m fund to create a virtual regional network made up of interconnected service providers.
In the small village of Neunen, two residents succesfullly lobbied the Dutch government to capitalize deployment of a fiber network, called OnsNet, which achieved a 97% penetration within 3 months of start-up. That remarkable goal was achieved through a cooperative ownership model. Property owners were asked to pay for the "last-mile" connection from the core network into their buildings. The case for citizens to put their own money into operating the coop was simple: they were investing in a home improvement that would increase the value of their property.
The citizens of Nuenen own 95% of OnsNet and join technical and operational executives at meetings to identify new ideas and solve current problems. And the pace of innovation has been unceasing. An online exercise and weight-loss program, with a "virtual fitness coach," is popular. A "Window on Nuenen" channel provides access to video cameras strategically positioned around town, which allows the housebound elderly to stay connected to the life of the community. The OnsNet community TV service trains locals in the use of video equipment and makes it simple to upload video clips. Clubs and societies post video of their meetings and events. A local church offers live broadcasts of baptisms and weddings on a paid basis. Parents and grandparents chat over video with children and grandchildren far away.
OnsNet is an example of something Brainport calls “open innovation.” The Brainport nonprofit terms itself is an open innovation platform, in which many players pursue their own interests in collaboration with others, with Brainport acting as instigator, facilitator, negotiator and traffic cop.
The model is simple to explain in theory but hard to carry out in practice. World markets are changing fast and demographics are presenting challenges to growth all around the globe. The hope of the Eindhoven region is that years of practicing open innovation, on a foundation of information and communications technology, provide an advantage that competitors will find it hard to match.
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Intelligent Community of the Year 2011
Smart21 2008 | 2009 | 2010 | 2011
Top7 2009 | 2010 | 2011
The Kempen is a 60-square-kilometer region extending from southeastern Netherlands to northeastern Belgium. Its name comes from the Latin “campina,” meaning “region of fields.” Until the 19th Century, it was a land of heath and sparse pine forests too poor to support agriculture. Then Napoleon Bonaparte dispatched a military ruler to the conquered territory of the Netherlands, and he decided that revolutionary change was in order. He organized a massive effort to collect animal and human waste from farms, villages and cities and have it worked into the soil. Years of hard work produced fertile farmland that, today, contributes to the Netherland’s #2 position in the world for the value of its agricultural exports.
Agriculture and tourism are mainstays of the economy, as in so many other rural regions. But in the Dutch Kempen, home to 108,000 people, the provincial government of North Brabant, its municipalities and intrepid individuals are applying Intelligent Community principles to build a new model of rural development.
House of Innovation
Huis van de Brabantse Kempen (House of the Kempen Region in Brabant) is an economic development agency for the region that consciously applies the Triple Helix or Innovation Triangle model. It brings together provincial government, business, education, healthcare and other stakeholders to cooperate on projects that create business opportunities and employment while addressing quality of life in the region. It has taken much time and energy to align all the parties, agree on objectives and investment choices and begin to take action. Founded in 2012, the Huis now has programs that educate local youth about career opportunities in the Kempen, train businesses in technology, connect entrepreneurs across the Belgian-Dutch border and promote renewable energy development.
Urban Levels of Fiber Coverage
This innovation program operates on an enviable digital platform. Village centers in the region have long been well-served by DSL and cable systems, but until recently, the rest of the region went begging. That changed when a Dutch broadband pioneer, Kees Rovers, began planning a fiber-to-the-premise network with local partners and obtained government grants to capitalize it. Through this effort, the region has already reached 97% coverage at fiber speeds, with property owners in many cases contributing to the cost of the last mile. Work is now underway to fill in the last and most expensive 3%. At age 70, Rovers is a serial broadband champion, having led the fiber network deployment in the village of Nuenen that contributed to Eindhoven’s selection as the 2011 Intelligent Community of the Year.
Many Hands Make Light the Work
Dutch culture is known for valuing self-reliance, and the Brabantse Kempen region is no exception. The village of Hoogeloon established a cooperative healthcare facility to stem the outflow of elderly residents who left to seek better care. Summa and the Pius X College partnered to establish a digital marketplace for eldercare services and program in which students care for elderly citizens in exchange for hands-on learning in gerontology.
Two brothers who own a potato farm, the van der Bornes, have become viral stars in the world of precision agriculture by publishing a stream of videos and presentation on their remarkable, self-taught uses of technology to boost yields from the field. A local success tory, the Vencomatic Group, sells its automated poultry-raising systems from South Korea to West Africa, demonstrating that a location in the countryside is no bar to global success. Across the Dutch Kempen region, that success is made up of one part strategy, two parts hard work – and a generous helping of individual initiative aimed at the common good.