The Rules of Attraction

Top of Mind

The Rules of Attraction

By Paula Bernier, Executive Editor, TMC  |  May 22, 2012

This article originally appeared in the May 2012 issue of INTERNET TELEPHONY magazine.

It’s been several months since TMC’s (News - Alert) last big trade show ITEXPO East 2012 in Miami, but there’s one moment at the event that I continue to revisit mentally. It was the moment when TMC CEO Rich Tehrani (News - Alert) mentioned the upcoming Facebook IPO and said that the public offer would create a lot of wealth for many in Silicon Valley, a fair portion of whom would be likely to sink that money into new enterprises.

Ah ha, I thought, maybe this is an opportunity for Arizona (my home base for more than 13 years) to attract more high-tech businesses. The state has been trying to do this for quite some time and, as a veteran tech reporter/editor, I would love for that dream to be realized.

So I sat down at my computer and I wrote a letter to the editor and e-mailed it off to The Arizona Republic. In it, I talked about how getting new tech businesses to move out of their comfort zone (Silicon Valley) and into Arizona would be a challenge given a lot of the money is in the San Francisco/San Jose area, and it’s an exciting and fertile place for start-ups. But, I went on to suggest, it was worth a shot. Arizona, I noted, could be a plumb location for many of these new organizations considering its close proximity to Silicon Valley; its relatively affordable cost of living; and its lack of earthquakes, hurricanes and tornados – which would seem to make it an ideal place to locate data centers.

Whether Arizona politicians and the local business community move on that possibility remains to be seen. They certainly haven’t had great luck on this front so far.

Google (News - Alert) was in Arizona for a short while, but split town a few years ago, apparently because the talent it sought was not available in the area. To make matters worse, I just read that the other giant in high-tech – none other than Apple – picked Austin over Phoenix as part of its expansion plans. Apple is investing $304 million to build a new Austin campus, which brings with it new jobs with annual salaries in the $40,000 to $200,000 range.

Bummer, I thought. But, then again, Austin is pretty sweet. Good food. Fun bar scene. And they have ITEXPO (News - Alert) and a little event you may have heard of called SXSW.

In any case, this all got me questioning exactly what it takes to get businesses to start or expand operations in one location vs. another, and exactly how some states and cities successfully become high-tech hubs while others seem to flounder.

After my The Arizona Republic piece that I wrote ran, Matt Pittinsky, CEO with Parchment Inc., an online education credential data company, gave me a buzz and hosted me for an interview at the company’s Scottsdale-based location. Matt, who founded the successful business Blackboard (News - Alert), told me he located his business here for family reasons.

In any case, he added, Arizona is becoming a specialty high-tech hub of sorts for the education space. And he noted that Apollo Online, Grand Canyon Online and Pearson are all in the area.

I asked him what more Arizona, or any location, needs to attract high-tech business, and what might prevent them from doing so. He said places that lack second- or third-generation product development and engineering talent are most challenged in attracting high-tech businesses of any sort. And he emphasized the importance of events that bring visibility to the tech activities in a given community.

Edited by Stefania Viscusi