Regional Wireless and Rust Belt Recovery

I'm out in the Silicon Valley for a few days, seeing friends and family and giving a presentation. But Pittsburgh's prospects and problems are never far away. To the north, Seattle P-I columnist wrote this generous comparison of the regional economic issues facing Seattle and Pittsburgh. We may think of Seattle as a high-tech mecca, but Boeing still casts a long shadow, and the technology industry there is still largely Microsoft and a cast of much, much smaller firms.

Meanwhile, the San Jose Mercury News brings word of "Smart Valley," a proposal to build a Silicon Valley-wide wireless network. The proposal is the brainchild of a government/industry consortium called Joint Venture:Silicon Valley. There are huge technical issues to work out, and the cost will be fantastic. The incumbent wireless carriers will fight it tooth and nail. Who knows if this will come to fruition?

The fact that the plan comes from a respected group of local business leaders is itself significant; this place has a "dream big and build it" mentality that is completely foreign to Western PA. If you need any further evidence of the difference between how Pittsburgh views the future and how an entrepreneurial high technology region thinks about the future, check out this reaction from a local tech analyst, quoted in the Merc:

Tech industry analyst Rob Enderle, of San Jose's Enderle Group, said he was optimistic about such an ambitious plan coming to fruition.
"I think it's definitely possible," he said. "You can certainly see a future where pretty much every place you go you could have free wireless access."
Enderle pointed out that the United States lags far behind other countries such as South Korea in terms of ubiquity and affordability of high-speed Internet access. The lag likely is more embarrassing in Silicon Valley, given its reputation as a base for advanced technology.
"If we really want Silicon Valley to not turn into the Rust Belt, we need to be competitive."

(my emphasis).

Pittsburgh isn't ready to be a Silicon Valley, and the Silicon Valley is afraid that it's going to turn into Pittsburgh.

Pgh Could Emulate . . . Miami

My colleague Michael Froomkin, who writes discourse.net from his home base at the University of Miami, blogs a brief post about what the U. of Miami is doing to help the City of Miami.

New Pittsburgh Quarterly

Chris sends a link to the new Pittsburgh Quarterly magazine, which he received in the mail, but I did not.

The magazine is produced by Doug Heuck, late of the Post-Gazette, and it has an impressive roster of contributors.

Does the emergence of the new Pittsburgh Quarterly mean that the original Pittsburgh Quarterly has gone away? Doesn't look like it. The trademark lawyer in me goes: Hmmmm.

P-G on Tech Transfer

Cori Shropshire writes about Pitt and CMU in today's paper.

There is much to add -- I wish that she had spent as much time talking to technology investors as she did talking to the university's technology managers -- but other matters are more important today.

Journalist to Blog in Pittsburgh

Print-based hand-wringing over what blogging means for traditional journalism is so 2004, yet the Post-Gazette is still at it. Bob Hoover dips his toe into cyberspace and reveals the following:

Unlike the established media, there are doubts about blogs' accountability, dependability and durability.

Also, outside of their mothers, it's hard to figure out whom these bloggers are targeting.

My blog, however, would be run through the Post-Gazette editing grinder intended to force out rumor, mistakes, innuendo, obscenity, gossip and speculation -- the very stuff that blogs are made of -- and keep the truth and correct grammar.

Sounds pretty boring, doesn't it? Could my dull blog attract any readers in a brave new world of snarky opinions and wild claims?

Well, I have a couple of not-so-snarky opinions and not-wild claims, confining my audience (and subject) to Pittsburgh:

First: There are some fine journalists in the local blogosphere. Check out Potts, Barnes, and Togyer, for starters. And there are an awful lot of other local bloggers who aren't snarky or wild. Stop by the next Blogfest and meet a few. Newspapers have to earn trust just like the next guy, Bob; no one simply takes the New York Times at its word any longer, let alone the Post-Gazette.

Second: Print journalism is indeed under attack today. But the real crisis has nothing to do with the blogosphere, and little to do with trust. The real crisis is that newspaper revenues are drying up as advertising shifts to the Internet. Print-based classified advertising is evaporating slowly. Google bought dMarc Broadcasting the other day, a move that may seem to have little to do with newspapers. In reality, that deal clearly signals that Google is first and foremost an advertising company, and it wants to dominate advertising across all media, not just via online search. Newspapers may get the display ads that Google brokers, not the ads that they sell themselves.

No revenue, no news hole, and eventually no newspaper. Google is part of the Post-Gazette's economy. Get used to it. Eventually, newspapers that don't embrace the Internet and blogging and other kinds of networking will disappear. Embracing the Internet means being willing to share advertising revenue and readers. A readable blog doesn't just have engaging content; a readable blog attracts readers who want to be pointed elsewhere, to other engaging content. I go there because I want to be sent away.

So welcome to the blogosphere, Bob! Don't hoard your readers. We'll read you if you send us away.

Mark Cuban to Pay for 'Burgh Bailout

"Cuban Makes First Pittsburgh Investment" hit the newspaper this morning with all the breathlessness that characterizes a damsel in distress, spying her knight in shining armor. Given what actually happened (Mark Cuban, the mercurial and fabulously rich son of Mt. Lebanon, made a little local real estate investment, then said that he has no plans to make more), the P-G could have announced the deal under the headline, "Cuban Makes Last Pittsburgh Investment."

If the media is going to play who's-going-to-save-us-now, why stop at speculating that Cuban will buy the Pirates and the Penguins? Why not wonder aloud whether he will build Pittsburgh a new arena or better, whether he'll simply pay off the accumulated debt of the City of Pittsburgh and buy the city outright?

Through no fault of his own, Cuban is no shining knight. Cuban is Godot. I've met his mom and I've heard stories of his childhood. If every son and daughter of Pittsburgh had this guy's entrepreneurial streak, this City wouldn't need to be rescued.

Bill Johnson Gets It (Sort Of)

A follow-up column by Pittsburgh's newest bestest friend in Denver.

Pittsblog Hits Online WSJ

Blogging about blogging: Today's online WSJ links to Pittsblog. Thanks!

Pittsburgh Wi-Fi

When Robert Scoble arrived in my office at Pitt yesterday, his first question was whether the law school offered open wi-fi. No, was the answer.

But Robert was still excited about the free wireless at the Pittsburgh airport and at the Omni William Penn.

This NYT piece covers some of the politics behind open wi-fi for cities.

UPDATE: Chris sent me this link, which reports on delays in creating wi-fi access for downtown Pittsburgh.

Mellon v. Mellon

Only in Pittsburgh. Follow carefully.

Richard Mellon Scaife, publisher of the Tribune-Review, publishes an editorial that calls for the head of Mellon Financial Corp. CEO Martin McGuinn.

We commend to your attention the names of nine members of Mellon's 15-member board. Some are local; others once were. Lest they look forward to a personal black eye, we call on them to grow a spine and do their civic duty in aiding a city that can afford to lose nothing more.

These high achievers must see to it that Mellon's management changes direction and, most specifically, that the stubborn and arrogant Mr. McGuinn is removed -- long before the September 2007 deadline for retirement he set for himself.

In the Post-Gazette, McGuinn fires back:

"But with both the organic growth that we are showing now, very good momentum and our ability to make acquisitions to fit our strategy, we think our shareholders are being well served," Mr. McGuinn said. Management believes "our strategy is the right one for Mellon."

Still, in a different P-G interview, McGuinn said that the Trib editorial was "beneath response."

If you look at this on the merits, it seems clear that Pittsburgh's future as a financial center is cloudy -- at best. It's hardly clear that re-energizing Mellon
is likely to save the company at all, let alone save it here in Pittsburgh.

The real story, though, may be that we're watching the last breaths of an old Pittsburgh family feud. That Scaife hates the Mellons, and moderate Republicans generally, is pretty well-known. A detail that I hadn't heard before -- but that was forwarded to me by someone in the local MSM -- is that the Trib's antipathy towards McGuinn may be payback for McGuinn's failure to support George W. Bush during the last election.

As if we don't have more important things to worry about. Maybe if the P-G didn't give the story any dignity, we could set aside grudges past, and focus on grudges yet to come.

Xplosion

I just love how much space the Post-Gazette gives the Pittsburgh Xplosion, an ABA basketball team that draws about 500 fans per game and plays in a league which appears to have outlawed defense.

Clearly, the team needs a new arena. The current facility isn't, well, xploding.

Toujours Pittsburgh

I've got the country wrong, but peterb's vignette of a morning spent savoring the best of the Strip calls to mind nothing so much as books by Peter Mayle.

Is Pittsburgh Mean?

Pittsburgh ranks number 20 on the list of "meanest cities in America" released recently by the National Coalition for the Homeless.

Pittsburgh wasn't on the 2004 list. What went wrong?

UPDATE: The City Paper explains.

Scoble on Pittsburgh

Thanks to Robert Scoble for all of his kind words about Pittsburgh!

Pittsburgh is having a steel hangover.

That’s what I kept hearing all day long. My life really is interesting because I’m now getting to a diverse enough group of cities in a short amount of time to get a feel for what’s happening in each city.

I didn’t expect what I found.

Why? Cause I, like many others even who live here, remember Pittsburgh’s past. It’s the city of steel.

I expected dirty, grimy, economic ruin, and all that.

But, I found a really pretty city that has great educational institutions and a vibrancy that many other cities wish they had.

But, there’s that steel hangover.

The city is still trying to figure out who it is. Is it a football town? A technology town (I met a couple of Apple employees tonight, for instance, who work here and Google is opening an office and Bill Gates donated a bunch of money to Carnegie Mellon where I’ll be getting a tour of the robotics lab tomorrow)? Or something else? A geek town?

If you want a visual log of Robert's tour, check our his Flikr photostream.

Donkeys Hate Pittsburgh; Pittsburgh Doesn't Care

Looking ahead to next Sunday's AFC Championship game, Denver's Rocky Mountain News sent a columnist to find the true Pittsburgh, and all he found was an out-of-date stereotype.

I will tell you this, something I would never tell one of the locals. Pittsburgh is one butt-ugly town. It is precisely the type of town that would name its professional football team the Steelers. Old mills, long stilled, dot the town. Weeds spill from smokestacks. Across the Ohio River from where I write this rises downtown Pittsburgh, as dark and forbidding a skyline as you will ever encounter.

Sure you're in the right city, Bill? Because that's not my city you're talking about. For Donkey fans looking to start a fight with Pittsburgh, here's a clue to the truth: We don't care about you. No one in Pittsburgh thinks that Pittsburgh is a better or nicer or more successful city than Denver is. But no one in Pittsburgh cares. No one in Pittsburgh thinks that Denver is a lousy football team. Anyone with a sober moment to spare knows that Denver has had a hell of a season. Sunday's game is going to be brutal -- regardless of the outcome. Close your eyes for a moment and imagine Hines Ward hitting John Lynch coming over the middle. (That's right: Hines, the wideout, hitting John, one of the most fearsome hitters in the game.) Imagining that collision is painful. But no one in Pittsburgh cares. Pittsburgh fans don't sit around agonizing over the talent on the other side of the line or the hits that our guys are going to take. Steeler fans -- and this includes Steeler fans everywhere, even in Denver -- are Steeler fans 24 hours a day, 365 days a year, world-wide, win or lose. Steeler fans believe that the Steelers are going to win every game, every season, regardless of the opponent. Oh, we walked around last week trying to keep our expectations low. The Colts were the best team in football this season. But beating them wasn't a miracle. The heart attacks provoked by the last two minutes of that game notwithstanding, we always knew that we could play with the Colts. Get the running game going, get the blitz working, and we'll be OK. We're proud of our guys -- Ben, Jerome, Willie, Troy, Hines, Joey, Alan, Aaron, Kimo, and I could go on, but I've got only a typical Pittsburgher's take on the team; I'm not a real fan -- and we'll still be proud of them, and we'll still be fans whether or not they go on to the Super Bowl. Real Steeler fans don't hate the other team -- unless the other team is Cleveland, including old Cleveland and new Cleveland -- and they don't go around perpetuating old stereotypes about other cities. Because the game isn't won in the newspaper columns. Steelers by 4.

Tax Subsidies Piece in the P-G Goes Missing

Chris Briem has an excellent op-ed in today's Post-Gazette business section that hasn't shown up, yet at least, on the paper's website. A quick summary can't do it justice, but in short, Chris argues that an upcoming United States Supreme Court case -- Cuno v. DaimlerChrysler -- isn't getting the attention that it deserves. Cuno, which comes out of the Sixth Circuit Court of Appeals, analyzed income tax breaks (investment tax credits) that Ohio offered to DaimlerChrysler as incentives to get an auto factory built in Toledo. The Court of Appeals ruled that the credits were unconstitutional under the Commerce Clause.

Chris argues that these kinds of deals are both incredibly common and incredibly problematic as a policy matter precisely *because* of their one-off nature. Instead of figuring out what across-the-board state and local policies are good for economic development, state and local officials tax-break-and-wheel-and-deal their way to one good-looking project after another.

What would it mean if state and local governments could not offer such packages in the future?

Some say it will mean the end of tax reform as we know it. But if unable to offer firm-specific incentive packages, state tax laws may be forced to address broadly the question of what tax structures promote investment and growth.

No longer would there be the distortions that are generated by project specific incentives. There will even be less need for lobbyists whose sole job is to promote particular projects and gain government support. The savings from that alone could be incalculable.

Chris doesn't draw the connection between Cuno and a better-known (or infamous) recent case -- Kelo v. New London, the case that narrowly upheld local authorities' discretion to define circumstances under which condemnation of private property was appropriate. The cases arise under different parts of the Constitution, but they raise similar questions for local development authorities: Are there any legal limits on what tools those authorities can use to promote development? From that point of view, condemnation and tax credits are flip sides of the same coin. The Supreme Court may not look at the problem as an integrated one, but if it does, you might see Cuno decided like Kelo was -- and investment tax credits restored. On the other hand, if you didn't like Kelo, then -- maybe -- you should like the idea of banning one-off tax subsidies for specific projects.

Meanwhile, Chris couldn't have expected that the P-G would run his piece on the top half of a page that also carried this letter from local investor Robert Capretto, praising Rick Santorum for intervening with federal authorities to come up with a $4.8 million federal highway subsidy to make the Tech21 project -- Medrad's new corporate home -- a reality. So much for abandoning government subsidies that distort overall policy judgments about growth!

UPDATE (1/18): Chris Briem's piece is now online.

Pittsburgh Business Blogging

New blog alert: Venky and Mike are up and running with Pittsburgh Business Blogging.

Technology Council Blogging Event

I'm looking forward to full blog posts reporting on the Pittsburgh Technology Council's blogging event, which is Thursday night, January 19. The PTC reports that the event is sold out. Here's the description:

The Blog
Blogging and podcasting are revolutionizing the way companies interact and communicate with customers, suppliers, partners and employees. Learn how these new tools are impacting marketing and branding efforts as you hear from a panel of regional and national experts, including Microsoft's Robert Scoble, Pepper Hamilton's Jim Singer, Schwartz Communications' John Moran, Pittsburgh Bloggers co-founder Mike Woycheck and moderator John Soat, Producer of InformationWeek's The News Show.

Thursday, January 19
6:00 p.m. - 8:00 p.m.
One Mellon Center, Third Floor Conference Room
$25 for Council and TiE Pittsburgh members, $35 for non-members
The event is SOLD OUT!

The event is co-sponsored by TiE Pittsburgh.

Pittsblog Coming to Blogfest 5

I'm planning to come (a bit late) to Blogfest 5, tomorrow night at Finnegan's Wake on the North Shore. See you there.

A Cappella Concert Next Weekend

You or someone you know may be interested in a cappella singing groups, may be interested in college singing groups, or may be (or want to be) connected to Yale. If that description fits, consider coming to the Ellis School in Shadyside next Saturday night (January 21) to hear the Whiffenpoofs of Yale, one of the premier undergraduate men's a cappella singing groups in the country.

Concert details:

Date, time, and location -- Saturday, January 21; 7:30 p.m.; the Ellis School, 6425 Fifth Avenue, Shadyside.

Tickets -- $30 at the door; reservations not required, but email me at pittprofessor@yahoo.com if you're thinking of coming, so that we can estimate attendance and ensure that there's room. Yes, it's pricey, but given the fee that the Whiffs charge, the local Yale Club will do well to break even.

Besides, where else can you see 14 guys in white tie and tails sing "Midnight Train to Georgia" -- with Pip-like choreography?

What's a Whiffenpoof?

Heinz and Economic Development

I'm not on the mailing list for these press releases, so, no, I hadn't heard:

More on Heinz Endowments ... By now, you may know that CMU Vice Provost and Chief Technology Officer Christina Gabriel is set to join the foundation on Feb. 1 as director of its newly renamed Innovation Economy Program. This is a real coup for Heinz' economic development efforts as Dr. Gabriel is well-known and respected for revamping the university's technology transfer office to speed its ability to bring inventions to the marketplace.

It's also an indication that tech-focused economic development -- growing viable successful technology firms with the strength of Pittsburgh's research and medical institutions -- is going to be a top priority for the foundation.

Dr. Gabriel wasn't specific about her plans, but she did suggest that it could be time for the region to take a look at the direction and focus of some of its tech-oriented economic development organizations, including those funded by Heinz such as the Idea Foundry, the Technology Collaborative and the Pittsburgh Life Sciences Greenhouse. "All of them have been in operation long enough [to see] what's working really well and what should be changed."

Lastly, Dr. Gabriel said that Heinz's role as a convenor of ideas and strategies around the region to make the tech industry better will continue. "I want to broaden the conversation a bit ... It's really about our attitude. We're much more willing to think big and try new things."

Link: http://www.post-gazette.com/pg/06014/637843.stm

Here's a suggestion for all of the "economic development" folks around Pittsburgh: Think Small. Don't Think Big. Thinking Big feels like and sounds like the old-time top-down, CEO- and institution-driven Pittsburgh way. I hear echoes of one five-year-plan after another, as the local economy continues to sink slowly into the Ohio.

I've had a lot of conversations with local entrepreneurs, investors, technology transfer folks, and lawyers since the Post-Gazette published my piece last November about the shortcomings of the local technology community, and I've learned a lot.

The most important thing I've learned, and the most consistent message that I've heard across the board, is that Pittsburgh has a shortage of deals. "Deal flow," in business jargon, is thin. One remedy for the local economy, therefore, is to figure out ways to increase deal flow. Put more technology in play; find ways to get investors off the sidelines and back in the game. Stop using economic development plans to pick likely winners and likely losers among local firms; let the market loose. From my point of view, Thinking Small means lots of deals. Lots of companies. Technology licensing. Partnering. Joint ventures. Buyouts and spinoffs. In a word: Movement.

None of that can happen overnight, and I've heard different views expressed regarding whether the direction of the current economy is positive (more deal flow), negative (less), or neutral. I'm sure that the right answer depends on a number of things, and moving "deal flow" in the right direction involves a lot of variables. Maybe I'm wrong, and Thinking Big isn't old-style Pittsburgh strategizing, but instead involves thinking about those variables and about how to stimulate more deal flow. If so, then great, and then Heinz's move is a good one. Thinking Big is really Thinking Small in disguise. But if Thinking Big means another five-year plan for saving the city, then we're better off without it.

TIF Abuse

I'm almost at a loss for words.

The grand new PNC skyscraper, the building that's going to save Pittsburgh, is the subject of a TIF (Tax Increment Financing) application.

That's right: The City of Pittsburgh and the Pittsburgh Public Schools are going to be asked to rebate the tax revenues that the building will generate, so that PNC Bank's real estate arm, which is developing the building, can generate a profit on the project.

Is this a great country, or what?

There are moments, folks, when a flailing community needs leadership. When the people of the city, the hard-working, tax-paying, long-suffering citizens of the Steel City need someone to speak up and take a stand for them and for their future. Someone who steps up to the plate and says, um, wait, aren't we already short a bunch of millions of dollars and why, anyway, are we giving more to PNC Bank so that it can build a luxury hotel and 30 top-floor condominiums? Isn't the money supposed to flow from the building to the city?

It's a simple test of character. Bob O'Connor, we're waiting.

MIT Enterprise Forum on Entrepreneurship

The local MIT Enterprise Forum is planning a program on entrepreneurship. Here's the link; the event is on February 22 at the Pittsburgh Golf Club, next to the Schenley Park Golf Course.

The website doesn't give much of a description. Here's the text of a flyer sent by a friend:

What Makes a Great Entrepreneur?

Just what does it take to be a “great” entrepreneur?

• Some say it’s the realization that you sometimes need to go beyond knowing the answers to sometimes seeking the answers.
• Others think it’s being at the right place at the right time.
• And still others think great entrepreneurs are gutsy risk-takers who simply achieved success through trial-and-error.

In any work we do, our performance and success is built upon education, formal training plus our accumulated knowledge from practicing the craft. Entrepreneurship is no different. Still, there is no comprehensive formula for realizing ultimate entrepreneurial success. After all, entrepreneurship is very much an art rather than a science - which makes it one of those subjects difficult to learn with any great degree of precision.

Until now, that is.

Join the MIT Enterprise Forum of Pittsburgh as we provide the early entrepreneur (as well as experienced ones) valuable “lessons learned” from some of our region’s best-known entrepreneurs:

• Ron Bianchini, PhD – Founder of Scalable Networks and Spinnaker
• Roger Byford – Founder of Vocollect
• Rob Cochran –Chairman, President and CEO #1 Cochran, Inc.
• Ken Gabriel, PhD – Founder of Akustica
• Raoul Vellez-Perez, PhD – Founder of Vivisimo
• Astro Teller, PhD – Founder of BodyMedia

Our esteemed panel will discuss important attributes of entrepreneurship and each will discuss one of their personal entrepreneurial traits and describe a specific episode where it helped in growing their company. We will also dedicate time to an extended “Question and Answer” session guided by our moderator, Jack Roseman a serial entrepreneur and award-winning educator.

While there is no simple ‘one-size-fits-all’ path to entrepreneurial development, it is a learnable skill - and discipline - and our esteemed panel’s leadership experiences will undoubtedly help you improve your own competencies along every step of your own entrepreneurial journey!

Invited to the Inauguration?

The big party is today. Are you going? Neither am I.

The truth is that Tom Murphy just wore us out. He was a very earnest guy who long ago lost whatever ability he had to inspire and lead. Sort of the Jimmy Carter of Pittsburgh.

Is Bob O'Connor likely to do any better?

Bobby Grier's Sugar Bowl Anniversary

Today's NY Times runs a tremendous story about Pitt footballer Bobby Grier, who was the first African-American player to compete in the Sugar Bowl, back in 1956.

"A black football player had never played in the Sugar Bowl, which is held annually in New Orleans. . . . Pittsburgh officials agreed to participate only if Grier, a fullback and linebacker, could play and if the sections of Pitt fans were not segregated."

The Post-Gazette's coverage was back in October, running alongside Pitt's celebration of that team.