Two Economic Development Lessons from Danville, VA’s Fiber Network

Danville’s City Manager Joe King is one of the speakers on a panel session about broadband’s impact on local economies I’m leading tomorrow at the Intl Economic Development Council annual conference. Some of the following story to give session attendees valuable insights to take back to their communities.

Danville, VA ’s public utility company (Danville Utilities) started its nDanville fiber network in 2004 to connect municipal and utility buildings, the K-12 schools, and then went commercial in 2006. nDanville now has 135 miles of fiber that passes more than 1000 business locations including five business parks. 100 Mbps is available to most commercial customers, and 1 gigabit and 10 gigabit services are available upon request.

nDanville was born as a last-ditch effort to save a town on Economic Death’s doorstep. As tobacco farming died out in the state, towns shrunk with the vanishing employment opportunities. Those in the workforce who remained faced serious challenges using their skillsets in other industries.

One of two important lessons to learn from nDanville stems from the question, is economic development helped best by using broadband to first attract new businesses, or do you work with your existing businesses first. Danville used the latter approach to facilitate the former.

The Danville Regional Medical Center is one of Danville’s largest employers. They have several clinics around town that move a lot of data among the facilities. The organization used nDanville to develop a quality and quantity of medical services that make them a major draw for businesses looking to re-locate to the town. It has expanded a lot over the past couple of years, opened a new facility and partnered with the Virginia College of Osteopathic Medicine for its residency program. This subsequently draws a notable number of younger professionals to the area who hopefully will stay and, in time, start their own practices.

After putting its business community on sound broadband footing, the town used the network to enticed a number of technology companies to start up here or move to the area. This in turn created a positive spiral effect as the high tech presence grew with the arrival of organizations such as Noblis, a nonprofit science, technology and strategy consulting organization that brought a supercomputer to the office it opened in Danville.

“High tech companies attract other technology companies,” says Corrie Teague, Marketing and Research Manager for Danville’s Office of Economic Development. “Some of these, particularly data centers, represent a high capital investment into our community. Each one can bring hundreds of millions dollars in innovations and construction as well as increase local tax revenue. Microsoft, for example, announced data center with a $500 million capital investment, and they’re doing $150 million in expansion within their first year.”

Tech companies offer the added bonus of being both trendy and offering higher paying jobs, which attracts younger people. At a personal level, the network should contribute to keeping these workers in the area to eventually start families, buy homes and thus further increase tax revenues.

While it is important for communities to assess their resources, demographics and even geography to determine what types of businesses are best suited for each respective community, it seems businesses in every industry have one question. “’Do you have fiber, do you have redundancy?’ is a standard question on every RFI that businesses send to communities to where they’re thinking about relocating or expanding,” says Teague. “When you meet with site selection consultants, the state economic development agency and business executives, it seems that broadband has moved higher on the list of criteria for a new location.”

The second lesson from Danville is that improving the education system and economic development go hand in hand. If a community is going to use broadband to grow current and newly recruited companies, their strategy plan must contain a strong education component that spans k-college to build the workforce skills these businesses demand.

Danville’s public school system incorporates broadband and tech devices into the curriculum, starting with pre-schoolers, using computing tablets with Internet access and special classes. Danville Community College has the Regional Center for Advance Technology and Training (RCATT). They work with companies to tailor these training programs, which increases graduates’ likelihood of being hired, plus the college offers generalized training.

At the moment, many states and localities are pouring vast sums into computing devices and other technologies including broadband for their students to prepare them to work in the digital economy. To maximize these investments, smart communities are building highspeed Internet networks so students also have sufficient bandwidth at home. And similar to leveraging a broadband-fortified medical community and its resources to attract new businesses to move into an area, so too stakeholders can deploy broadband to leverage the education community as part of their economic development strategy.