VEDA Spring Conference Building a Community Innovation Strategy

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VEDA Spring Conference Building a Community
Innovation Strategy
The Honorable Aneesh P. Chopra Secretary of
Technology March, 2008
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Agenda for Discussion
I. The Innovation Imperative
II. Three Levers for Reform
III. Coda A Regional Opportunity
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The Innovation Imperative
Thriving Technology Sector a Key Pillar of
Virginias Competitiveness
Virginia Atop the Nations States
Technology Drives Virginia Economy

• In 2007 American Electronics Association noted
  Virginia has the highest concentration of tech
  workers in the nation
• Sixth lowest unemployment rate in the nation
  (3.1 as of July 2007)
• Kaine Administration 43,075 new jobs and 5.8
  Billion in new investment
• In 2006, Forbes.com named Virginia the best state
  for business

• 32 of all new jobs statewide created in the
  technology sector (year ending June 2007)
• Wages in the technology sector represent 29 of
  all Virginia salaries (year ending June 2007)

Employment Growth 2Q06 vs. 2Q07
2.1
1.0
All Industries
Technology Sector
Source Virginia Economic Trends 2Q2007, Chmura
and Virginia Employment commission AeA
Cyberstates 2007 Report
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Council on Virginias Future Indicators Reveal
Strong Performance
Virginia Performs
Source Virginia Performs Website
(www.vaperforms.virginia.gov)
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National Indicators Warn of Anxiety with Global
Economy
Drilling Down on Anxiety
CNN/Opinion Research Poll October 2007
WSJ/NBC Survey December 2007
Changes in Share of Employment By Occupational
Skill
What do you think foreign trade means for
America an opportunity or a threat?"
Do you think the fact that the American economy
has become increasingly global is good or bad
?"
46
45
58
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Threat
Opportunity
Bad
Good
The Sagging Middle
There is still strong demand for high-end
workersButdemand is increasing for some workers
at the low end of the pay scale the ones who
wipe brows in hospitals, care for kidsand stand
guard. The losers? The sagging middle D.
Wessel
Source How Polarizing Job Scene Squeezes
Middle, WSJ 10/12/07 CNN/Opinion Research,
10/07 WSJ/NBC Survey, 12/07
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Three Levers
Working to Ensure all Virginians Benefit in the
21st Century Economy
I State RD Investments
II An Innovation Infrastructure
III Filling Tomorrows High-End Workforce
STEM Education Strengthen Virginias K-12
system by growing tomorrows science and
engineering leaders
Universal Broadband Develop public-private
partnerships to ensure access to low-cost
high-speed services
Investing in Guided Innovation Support 1.2
billion RD goal through state funding,
incentives to promote corporate research
SoTech Agenda
Workforce Reform
VRTAC Reform
CIT Agenda
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Corporate Leaders Under-invest in RD, Fail to
Leverage Universities
Concern 1 Underinvestment in Corporate RD
Corporate RD Expenditures Per 1,000 of
Corporate Sales
University RD Expenditures Virginia Total and
Industry-Sponsored RD
Universities on track to achieve 1.2BN goal by
2010, mostly driven by federal government
949M
795M
52M
40M
2002
2006
Industry RD grew 1.8 over same time period
nationally
Virginia ranks 20th nationally on private RD
funding 2.25 of 2004 Gross State Product and
falling
Source 2007 MA Innovation Index, National
Science Foundation, The New Economy Index,
National Governors Association, 2007
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Kaine Economic Development Strategy Links
Prospect to RD Assets
State RD Investments
Building the RD Agenda 2007 VRTAC Priorities
2008 CTRF Awards
Modeling Simulation

• Life Sciences (3) 882,610
• Technology (2) 511,555
• Modeling and Simulation (1) 451,013

Energy
Life Sciences
Technology
1
2
3
Nanotechnology

• 117 matched 52 by private industry
• 75 involve university collaboration
• 80 jobs attracted with growth potential

Priorities selected by reviewing existing
strengths, revenue growth potential, and
alignment to industry
Source Research and Development Strategies and
Directions for the Commonwealth of Virginia,
VRTAC, March, 2007 Commonwealth Technology
Research Fund
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Case Study
Rolls-Royce Deal a Blueprint for 21st Century
Economic Development
A New Model
Prince George Rolls Royce commits 100 million
to establish aero engines expected to create 500
jobs Research Key lever a research
collaborative between UVA and Virginia Tech to
support advanced manufacturing
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Double-Click on Importance of Higher Education
Workforce Enhancement New Technology and Products
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Opportunity to Spur Public, Private, University
RD Collaborative
The Path Forward
2009-2010 Competitive Research Budget Package
Research Priorities Independent research
confirms Virginias strengths in renewable
energy, life sciences, and technology sectors
Opportunity for All Encourages university
collaboration, support for economically-distressed
areas and historically black colleges
Matching Funds Secures 2M in matching funds to
induce industry investments in Virginias
universities
Energy RD Strengths Khosla Ventures Framework
Public-Private-Academic Partnerships Missed
Opportunities
Solar
Case Studies
Wind
Tools
Geothermal

• 500M partnership with UC-Berkeley, U. of IL,
  BP-Amoco to create the Energy Biosciences
  Institute BP invited 5 universities to bid (none
  in VA) 70M in state incentives
• 435M public-private partnership to seed INDEX
  with SUNY-Albany, Harvard, Yale, MIT, AMD,
  Freescale, IBM, Intel, Micron, TI to focus on
  Bell Labs for Semiconductors 80M in state
  incentives

Water
Natural Gas
Coal
Plastics
Materials
Electrical Efficiency
Efficiency
Building Materials
Oil
Mechanical Efficiency
Corn/ Sugar Fuels
Future Fuels
Cellulosic
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Concern 2 Infrastructure Investments Incomplete
Unique Infrastructure Strengths (Dulles, Port)
Mask Statewide Need
Access to Global Talent With direct flights to
every continent on Earth, Dulles Airport provides
access to the best minds across the globe Dulles
was a key factor in recruiting Janelia Farm, the
groundbreaking research arm of Howard Hughes
Medical Institute
Access to Global Markets The Port of Virginia is
the 4th largest exporting port in the United
States it is the only port that has the option
of expansion the Ports existing 50-foot
channels are deeper than any other East Coast
port and can accommodate the worlds largest ships
Access to Global Information Virginia ranks 13th
in broadband penetration despite record
investments in rural infrastructure deployment
(funded by the Tobacco Commission) Kaine
Administration calls for universal access to
broadband for business by 2010
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Healthy Coverage Across Sites, Distance a Factor
for Underserved
Measurement
VA Scan In Brief
Goal Establish a baseline for Governor Kaines
economic development strategic plan calling for
universal access to broadband for
business Economic Development Database VEDP
maintains VirginiaScan, a database of 4,000
commercial properties throughout the Commonwealth
Results 85 have access today of those
without access, 60 are available now 2x as far
from an airport (40 miles) or highway interchange
(16 miles)
Source Virginia Economic Development
Partnership, Verizon, Comcast, Cox, Lenowisco,
Citizens, BVU, nTelos
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Emerging Technologies a Growing Share of
Broadband Market
Technology Blueprint
Wireless Infrastructure SVEN Case Study
Virginia High Speed Lines by Technology Other
(Not DSL, Cable)
464 growth rate (likely due to improved
reporting)
22.6
4.0
June 2005
June 2006
Cost per Home Served By Technology
1,500
125
WiMAX Appomattox-Pilot
Fiber-to-the-Home
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Business Models
Private Sector Investment Spurred by Public
Sector Collaboration
Capital Investment Private Partner, 000s
Cash Flow Customer Distribution
County Economics By Source
Public safety grant covers 50 of County
investment, funds tower
County participates as a customer, pre-pays
five-years of service at 24K
Residential (220) 43
County Spend 14
500
Waived Lease Revenue 18
Business (104) 57
Capital Savings
123
Access to Public Infrastructure (Non-Cash) - 69
Actual
Build-out Estimate
Cash flow generated from wireless operations
(260k) exceeds initial capital investment,
accelerates further build-out
Capital spend covers 70 of geographic region
Publicly-owned towers support 6 of 7
infrastructure locations
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Community Outreach
A Coordinated Effort to Attract Needed Broadband
Capital
Federal Broadband Funding Virginia of Total,
2006 Data
Leadership at the Congressional, state, and local
levels helps attract above-market share
Town Hall Well over 100 residents (out of 700
population) attend meeting to discuss broadband
only 8 attend on public sewer project
7.6
1.6
RUS Community Connect
Federal Universal Services Fund
RUS Community Connect in 2005 Lenowisco PDC
secures 500K to serve residents and businesses,
including blog!
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Educational Attainment, Test Scores Affect Our
Ability to Compete
Concern 3 Too Many Virginians Left Behind
Educational Attainment Virginia
Test Scores and Economic Growth OECD Countries
A highly skilled workforce can raise economic
growth by about .67 a year (30 of 2007 real
GDP growth of 2.2) if America led the world in
math and science achievement over the past decade
- Hanushek
Source Council on Virginias Future Education
and Economic Growth, Education Next, Hanushek,
Spring 2008
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Filling Tomorrows High End Workforce
Dual Strategy to Improve Our Finest, Extend
Opportunity to All
Virginia awarded 13.2M from Exxon-Mobil to drive
up the utilization of AP exams through training
and student incentives
Governor named 6 Academies modeled on the
Governors Schools seeded by 500K NGA grant to
uncover hidden talent
AP Enrollment (At Least One Course) Virginia
Public High School Students
Computer Engineering or IT as Planned Major
Virginia High School Seniors
Number of students scoring 3 or better increased
12.3
VAs 6 CTE Academies will serve 2,800 students in
first year
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12
2005
2002
2006
2006
From Competence to Excellence
Our education goal should be to promote true
excellence by moving beyond our focus on
competence, as measured by scores on standardized
tests of minimum expectation. Governor Tim Kaine
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THEORY
S K I L L C O M P O N E N T S
HANDS-ON
Nothing But Questions
Theoretical Physics
Experimental Physics
Addressing the Curriculum Gap
Discover describe existing world
Discover languagesto quantitatively describe
existing world
Design buildnew systems
Fabricate operate new systems
Build or repair existing systems/components
Traditional
Welding HVAC Electricity Plumbing Electronics Man
ufacturing (Surgeon 19th C.) A Comp
Repair Comp Network Admin CISCO Network ORACLE
Internet CAD Model Simulation
Wind Tunnel Aircraft Maintenance Airframe/Powerpla
nt Particle Detectors Integrated Circuits
Physicist Chemist Biologist Research
MD Astronomer Geologist
Algebraist Geometer Topologist Statistician
Aerospace Automotive Chemical Electronics Computer
Civil Model Simulation Research Surgeon
21st Century
4-yr College ()
2-yr college/OJT
4-yr College ()
4-yr College ()
HS with National Certifications
Traditional Academic
CTE
Current K-12 Gap
Sometimes Instrument Maker
Source Jim Batterson, NASA
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Public-Private Partnership to Harness Regions
Innovation Assets
Coda A Regional Opportunity
A Regional Collaborative
The Chesapeake Crescent will become a recognized
global leader in the innovation economy by

• Linking federal labs, universities, entrepreneurs
  and investors to build a culture of innovation,
  creativity and entrepreneurship
• Creating linked investment strategies to attract
  small and large businesses to the region in such
  areas as energy, IT, environment, life-sciences,
  and homeland security
• Utilizing the buying power of the regions 10
  million consumers and multiple government and
  private sector buyers to invest in and adopt
  innovative technology products and services

On January 29th, 2008, Governors Kaine,
OMalley and Mayor Fenty announce public-private
partnership to increase the region's global
competitiveness