It’s pretty well accepted that Seattle is the epicenter of cloud computing, with the industry’s two giants, Amazon Web Services and Microsoft, both headquartered here and a host of smaller companies streaming into the area to build connections and share in the talent pool.
Could the same thing happen in Seattle, or statewide, with the Internet of Things? A group of business and government notables kicked that idea around Friday during the half-day Washington IoT Summit, hosted by law firm Davis Wright Tremaine and the state’s Department of Commerce.
Their consensus: It could happen, but it won’t be easy.
“Can Washington State really become the nation’s leader, perhaps the world’s leader, in terms of IoT?” asked Dave McCarthy, senior director of products for Bsquare, an IoT-software company in Bellevue, east of Seattle. “I would say, ‘Why not?’ We have all the right ingredients from business, from government, to be able to do this kind of thing.”
Added Ron Zink, CEO of consultancy ZTack, “If you’re going to do IoT and go directly to the cloud, you have the two major companies in the world here. If you’re going to go through a system integrator, you have a bunch of companies working with them. … The No. 1 thing we can do is ask how to create a center of excellence where everyone gets together and creates an ecosystem.”
Panel moderator Joseph Williams, lead for Washington Gov. Jay Inslee’s Information and Communication Technology sector, said of the idea, “That’s something tangible we can pursue. It’s not likely, but it’s something we can pursue. Maybe it’ll happen.”
Part of the difficulty, he suggested, is that Washington is a “very complex state,” with multiple funding sources and sometimes-competing interests.
“We have PUDs that are able to do certain types of investment in broadband and IoT in the Smart Cities initiative,” Williams elaborated. “We have ports, which have the ability to drive economic development. We have EDCs (economic-development councils) and government-supported agencies that are looking for business development. We have it at a city level, a county level. The state does its thing. Trying to pull all that together to actually drive the innovation [is difficult],” he said.
Creating such a center might take collaboration between Washington’s counties and cities, Williams said. “Do I see the mayor of Seattle talking to the mayor of Tacoma talking about joint economic development?” he asked rhetorically. “I haven’t witnessed it yet, but that’s not to say it’s not on the agenda.”
Another obstacle, he said, is that Washington State is constitutionally prohibited from making direct investments in corporations. “So could the legislature allocate $100 million to build an IoT research center of excellence? Probably could, but the political will in a McCleary year is very low for something like that. What we don’t have is the same type of levers other states can pull around economic-development activities. Indiana and North Carolina have more levers to pull.”
McCleary is a state supreme court decision requiring the legislature to improve and fully fund public education by 2018.
Meanwhile, other cities and states aren’t standing still when it comes to luring IoT business and development, Zink noted.
The University of Wisconsin-Madison has an IoT lab where 25 companies have come together to work on the technology, including obvious candidates — IBM, Intel, GE, Johnson Controls — and some that are less obvious, such as refrigerator-maker Subzero, Briggs & Stratton and even American Girl Dolls.
Chicago has its 1871 center for technology and entrepreneurship, which is working on IoT projects with local companies that are, as one news story put it, “making Chicago a global leader in the Internet of Things.” GE is moving its headquarters to Boston from Connecticut for $145 million in incentives, promising to put $50 million back into the Boston community.
“We don’t necessarily have to open our wallets,” Zink said, “but how can state and local governments provide leadership to create a nexus of people doing wonderful things? We should set this goal for ourselves and set a date and say ‘Let’s get this done.'”