Silicon Silliness revisited

Silicon this. Digital that. There are places all over the country that would have you believe that they are new hotbeds of high technology and job opportunity. We take a look at the reality behind their myths.

"We have jet service here," brags Chris Young, a senior project manager at the North Dakota Department of Economic Development and Finance. "We have hot water, we have heat, and we have electricity."

Young isn't joking. He says many people have an otherworldly mind-set about North Dakota. He recalls a recent visit to New York when someone asked him how he had made his way there: "I said, 'Didn't you see my horse outside?' "

Young's job is to attract high-tech employers, not all of whom can name the capital of North Dakota (Bismarck) or even know exactly where it is (between Minnesota and Montana, and just as cold).

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What's in a Name?

Are Silicon Prairie, Silicon Glacier and Silicon Bayou among the hottest of the country's high-tech hot spots?

"They are not real," says Michael Nieset, a principal at Christian and Timbers. So they're just Silicon Valley wannabes? "I wouldn't even give them that much credit," Nieset sniffs.

Keith Dawson, editor and publisher of the online newsletter "Tasty Bits From the Technology Front" (www.tbtf.com), has made something of a specialty of cataloging these "siliconia." He says there are more than 100 such places now, most of them in the U.S.

There are 10 places going by the name Silicon Prairie, five Silicon Beaches, three Silicon Mountains and two each of Silicon Bayou, Forest, Gulch, Parkway, Swamp, Tundra, Village and Vineyard. There's a Silicon Hollow in Tennessee and a Silicon Holler in Virginia. Just west of Philadelphia lies Philicon Valley, and Fairfield, Iowa, is Silicorn Valley. "I think a lot of places are doing themselves a disservice by being 'silicon' copycats," says Ross DeVol, director of regional and demographic studies at the Milken Institute. "It raises credibility issues. You're better off saying you are not Silicon Valley but you have some of the basic ingredients to actually make something happen there." Dawson says that in order to become a high-tech mecca, a city or region needs excellent schools, a political consensus for technology promotion at state and local levels, good access to venture capital and "some sort of local booster club or trade association." And not being Silicon Valley is now a plus, Dawson says. "It's impossible to drive in, undesirable to live in, impossible to buy a house in. It's basically choking," he says. Perhaps the only high-tech growth area in the U.S. not to have crowned itself with a "silicon" title is Boise, Idaho, which has the ninth-highest percentage of technology workers among all U.S. cities. "The area has not really marketed itself," says Bob Lokken, president and CEO of Knosys in Boise. "It's a well-kept secret."
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In addition to heat and electricity, Young says, the state boasts a low cost of living and workers who are extraordinarily well educated yet are often employed in jobs well below their abilities. "Underemployment—in huge capital letters—is our problem," Young says. But the state's problem is a golden opportunity for high-tech employers, he insists.

It will be some time before any North Dakota city joins the ranks of techno-enclaves such as San Jose, Seattle, Boston or Washington. But the state is unmistakably an up-and-comer in high technology. Recently, the Santa Monica, Calif.-based Milken Institute published a list of the top 50 U.S. cities in terms of growth in high-tech output during the 1990s. Grand Forks, N.D., and Bismarck ranked 37th and 43rd out of the 315 cities considered, respectively.

Trying to improve their chances of landing on one of these lists, many metropolitan areas have aped Silicon Valley by adopting names such as Silicon Prairie, Silicon Gulch or Silicon Bayou.

About two years ago, in an article titled "Silicon Silliness" (March 22, 1999), Computerworld investigated some of these locales to find out which of them truly deserved their titles. Deciding it was time to take another look, we're presenting an updated list of Silicon Somethings.

It's not clear how much this moniker mania has helped attract high-tech companies. But a number of small and midsize cities have, almost unnoticed, begun to morph into digital domains.

The Milken Institute's list of 50 top "tech poles"—which combines several measures to arrive at a city's overall "technology gravitational pull"—includes perennial favorites such as San Jose (No. 1), Boston (4) and San Francisco (22). But also making the top 50 are Albuquerque, N.M. (7); Boise, Idaho (24); Cedar Rapids, Iowa (35); Minneapolis-St. Paul (32); and Colorado Springs (42).

These upstart tech poles say three things give them an edge: well-educated, highly motivated workers; modest living costs and tax rates; and lifestyle amenities to die for.

"Having to sit through a stoplight twice here would be considered a massive traffic jam," says Bob Lokken, president and CEO of Knosys Inc., a software developer in Boise. "Our offices are about 100 yards from the river. Guys go fly fishing at lunchtime if they want to." Lokken says one-third of Knosys' 100 employees came from outside the state, many looking for access to fishing, backpacking and skiing. They came, too, for Boise's laid-back, low-crime community. And few ever leave Boise, it seems, giving Knosys a turnover rate close to zero.

That turnover rate, combined with low taxes and living costs, gives the Boise area's 360 high-tech companies a huge advantage over their counterparts in Silicon Valley, Lokken says. Technology companies with a major presence in Boise include Hewlett-Packard Co. and Micron Technology Inc.

In a recent study of the country's top 60 "cybercities" that was conducted by the AEA (formerly the American Electronics Association), the Washington-based trade group ranked Boise second after Fort Worth, Texas, among small cities for growth in high-tech employment from 1993 to 1998 and found that Boise had the shortest average commute time (16.3 minutes).

Poised for Growth

Colorado Springs ranked first among all cities in high-tech employment growth, second after San Jose in percentage of homes with computers and Internet access and second after Boise in average commute (18 minutes). A number of relatively remote small and midsize cities ranked high in the AEA's various measures of technoprowess.

Semiconductor makers have been in Colorado Springs since the late 1970s. But the area got its biggest boost to high-tech status in 1992 when MCI Corp. moved hundreds of software developers there from northern Virginia.

Now, at a population of 515,000, the area has reached the critical mass that attracts ever more high-tech workers, says Rick Scott, president of the Greater Colorado Springs Economic Development Corp. He says technology workers can move to Colorado Springs knowing that their spouses can probably find employment there and that if they lose their jobs, they can easily find new ones.

Places like Colorado Springs and Boise can now profit by comparison with areas that are saturated with technology companies and people, says Ross DeVol, director of regional and demographic studies at the Milken Institute.

"In Silicon Valley, Atlanta and Fairfax County, Va., what was a 20-minute drive to work is now an hour and 20 minutes or longer," DeVol says. "And the median house price in Silicon Valley for a three-bedroom house is $550,000."

Nevertheless, getting IT executives to move to small, out-of-the way places isn't easy, no matter what the quality-of-life benefits, says Michael Nieset, a principal and managing director at Christian & Timbers, an executive recruiter in Cleveland. It's far easier, he says, to get midlevel managers and programmers and analysts to take jobs in those places.

In fact, Nieset says, companies established in large cities might well open branch offices in more remote locales to take advantage of the low costs, much as some companies today outsource software development to India. The most senior employees might be moved to those places for, say, two-year tours of duty while more junior employees would stay permanently.

Some high-tech workers will always want to be in one of the country's technology epicenters, "but many other young workers are deciding there are other places that offer a better lifestyle," DeVol says. "They have been voting with their feet." In the next five years, the biggest growth in high-tech employment will be in cities like San Diego, Colorado Springs, Salt Lake City, Boise, and Austin, Texas, he says.

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