Broadband and New Factories

There is a lot of talk across the political spectrum about the need to bring manufacturing back to the US. The pandemic has made it clear that the US is far too dependent on other countries that make the things we need to succeed. I found it painful back in March and April watching governors pleading with foreign countries to ship us the basic supplies needed to test for the coronavirus.

Medical supplies are just the tip of the iceberg and as a country, we’ve outsourced goods across the spectrum. It’s disappointing to look at the iconic American companies that no longer make their goods in the US. We’ve outsourced Schwinn bikes, Rawlings baseballs, Levi jeans, Converse All-star sneakers, Fisher-Price toys, Samsonite luggage, Brach’s candy, Fender guitars, Dell computers, Black & Decker and Craftsman tools, Radio-Flyer red wagons, and even America Girl and Barbie dolls.

Over 60,000 US factories have shut since 2001 when China joined the WTO. Manufacturing jobs at the end of WW2 II represented over 60% of all jobs in the US economy, and that has dropped today to under 9%. The reasons we’ve lost American factories are complex. While much of it can be blamed on manufacturers chasing higher margins through lower labor costs, many US factories also grew old and obsolete as owners didn’t put profits back into modernization. The strong US dollar has often contributed to US-made goods being at a disadvantage on world markets.

The current administration has made it a priority to create American manufacturing jobs and has succeeded in adding back about 900,000 manufacturing jobs since the start of 2017. Joe Biden in his recent presidential acceptance speech talked about creating policies that would create 5 million new manufacturing jobs. The pandemic has made it clear to politicians on both sides of the aisle that we need to manufacture critical goods like drugs and electronics in this country again. It’s insane for the country to have to rely on others for basic commodities like medicines.

The question I ask today is if communities in America are ready for new factories? New factories are different than traditional factories. New factories will almost universally include at least some level of automation. New factories will require a fast and secure broadband connection. Factories today are tied into the cloud for much of the software they use. They use the Internet to interface real-time with suppliers and customers. Factories are often connected to other branches of the company that collaborate over broadband in real-time.

Any community that wants to attract new factories must have great business broadband. That means not only fiber to connect to the business parks where factories are located, but it means diverse fiber routing so that a factory doesn’t lose broadband if somebody cuts a fiber inside of a city. It also means having diverse Internet routes leaving a city so that a fiber cut doesn’t isolate broadband. Factories are not going to locations where the Internet connections are not iron-clad.

Many communities I work with are still working to solve the first issue, which is to build the basic fiber infrastructure. We always hear about communities that have made the big plunge to build fiber to everybody in town, but there are far more communities that have quietly found ways to bring fiber to industrial parks and other key employers.

However, building fiber to business parks is only half of the needed solution. It’s just as important to a community that the fiber connection between the community and the Internet is secure. Factories really don’t care if the reason for fiber outages is inside or outside the community – they want to locate in places where broadband connections are virtually guaranteed.

Unfortunately, many communities are served by poor middle-mile networks that make the community susceptible to Internet outages. This blog from May talks about the counties in northwest Colorado that have suffered as a region every time there has been an outage on CenturyLink’s middle-mile fiber. It was fairly common for a fiber outage in the region to knock out broadband to the whole region and the key infrastructure like hospitals, law enforcement, and factories. These communities banded together to construct Project THOR – a fiber network built to guarantees that a fiber cut or an electronics outage doesn’t disrupt broadband.

If we are going to see a resurgence of new factories, then communities need to make an honest assessment of the local and regional broadband capabilities and vulnerabilities. Cities that have sound broadband infrastructure need to be crowing about it, and communities with gaps in Internet capability need to get in gear and find ways to solve broadband problems. If we indeed see a flood of new factories being built, it might be a once-in-a-generation event, and cities don’t want to miss out due to not having decent basic fiber infrastructure.

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