Cloud Computing and Small Towns

Cloud Computing and Small Towns

boydtonitpacsWe all agree with the idea that cloud computing technology benefits people and enterprises thanks to its innovative potential both technological and economic.  But, going deeper with the analysis, it is clear that there are some social problems that we need to discuss, especially about the relation between small centers and over-the-top companies such as Apple, Google, Microsoft, etc.

As Quentin Hardy reported in New York Times, the small town of Boydton, VA is now facing this kind of issue because, here, Microsoft is building six hangars with thousands of computer servers (the program is about other 21 buildings in the area). This run of building networks in local area to provide services over the internet, a technology trend known as cloud computing is still increasing among technology giants like Amazon, Google and Microsoft. Google indeed started building in eastern Oregon to be near cheap hydroelectric power on the Columbia River, and most recently it has focused on Iowa, Alabama and Tennessee. Furthermore. Microsoft has a center in Wyoming, and it bought a nine-hole golf course as part of a complex near West Des Moines, Iowa. Amazon recently built similar giant facilities on the outer reaches of Columbus, Ohio, and Dulles, Va.

Local people, along with many economists and officials, often think these data centers are a key to an industrial revival, but the situation is not so simple. Let’s try to explain it.

The companies come to places like Boydton for basics like land, water and electricity. Even with low local wages, people are a high-cost item. According to E. W. Gregory, the head of the local electrical workers’ union, this is hard for local people to find long-term position at the data center. It is a problem because in the past, textile and furniture industry created a big power grid in the area but nowadays those jobs have gone. In Boydton, for example, the prison closed in 2012 and Burlington Industries textile plant shut in 2002 and it was razed in 2012 (2,000 jobs lost). In Clarksivlle a Russell Stover candy factory (700 jobs lost) closed in 2001 and now here there is a data center for the Department of Homeland Security.

The development of cloud computing industry in the area is related to South Virginia tobacco economy collapse. With vision, the state of Virginia used money received in a settlement with cigarette makers to build high-speed fiber-optic lines throughout the region. So, the development of broadband infrastructure and fiscal aid called Microsoft to Virginia (Apple also was interested in building a big cloud center for consumers’ photos and music in Boydton site but it went across the border to North Carolina, a state with tax breaks on data center equipment): Wayne Carter, the county administrator says that Microsoft obtained 350 acres by Mecklenburg County and other tax concessions. This policy should have help the country because, in his words, “even temporary workers rent houses, stay in hotels and eat in local restaurants”.

In return for this advantages Microsoft promised that “an average, data centers employ tens to several dozen people” between corporate and contracted positions. Mr. Thomas C. Coleman III, the mayor of Boydton, is more pessimistic: he says that “it’s a slow process” and “we can provide a place to live, but all those contractors will move on to the next town where they’re building,”. In fact, construction workers on the data centers rent houses and eat in local restaurants, but the economic boost is temporary.

Moreover, new jobs are too few or low-wage to cover the demand: unemployment is likely to hundreds of applicants because they look for a work as digging ditches, laying pipe, wiring starting at few dollars an hour. Although working as a security guard or testing the wires inside the data center is better paid, there are not many position. In addition to this, Microsoft prefers to not hire people who have worked for its competitors, so the situation is truly complex also for the fact that this business is very profitable.It has been estimated that business in cloud-computing is worth $1 trillion or more and the biggest three companies are trying to extend it globally. To achieve the goal, they spend more than $2 billion annually.

Also Professor Erik Brynjolfsson from Massachusetts Institute of Technology (MIT) admits that the phenomenon is growing rapidly because “it is the key enabler of all kinds of technology advances, starting with the things companies do now, but lots cheaper, including outsourcing tech jobs”. In his opinion for towns like Boydton people are going to have to move to new places. This prediction is quite incredible if we think that Boydton is the quintessential quaint courthouse town. The challenge of the future might be how ensure that this huge value created by cloud computing technology creates shared value among people.

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Il cloud computing è visto come un fattore innovativo, sia dal punto di vista economico che tecnologico. Non sempre, però, si calcola l’impatto sociale che l’installazione di questo tipo di infrastrutture ha sul territorio che le ospita.