James Fallows on the Importance of Location
|January 9, 2007||Posted by Staff under Archive, Progress Report, The Progress Report|
Online Economy Hasn’t Brought Down Site Values
Location Seems to Matter More, Not Less, in Electronic World
by James Fallows
Most Net people assume this is true: that as connection and communication matter more and more, physical location will matter less and less.
The widespread and generally unchallenged Net belief is that the age of communication — from email to teleconferencing to wireless devices everywhere — will finally make physical presence and location irrelevant. Work will be farmed out around the world, wherever talented people are available. The living-hell of airline travel and commuting will diminish, as we perform our work from a location we choose.
Everyone knows the evidence of this proposition. People log in from around the world to connect with the head office. Cargo ships deliver countless wares produced overseas, using designs sent to manufacturers by email. But consider the evidence on the other side:
- The real-estate premium for choice, central locations — Manhattan, the San Francisco Bay Area, Seattle — versus the hinterlands is higher than ever before, suggesting that people in the same business find physical proximity to work worth an ever-rising price.
- Well over half of all U.S. venture capital flows through Northern California, rather than dispersing — as it would if location didn’t count.
- The biggest and most fiercely competitive knowledge-industry companies make a point of concentrating their work in central locations, rather than scattering it across the country. Land is far pricier in Redmond, Washington, than in Amarillo, Texas, but Microsoft keeps putting its new buildings close to the old Redmond ones.
- Just as the “paperless office” era has led to steadily higher pulp consumption, so the age of the “virtual office” has led to more passengers on the airways and more commuters on the roadways than ever before.
So the question is: Why should we think it will ever be different? When, exactly, will location and face-to-face contact cease to be as important as they are now?
This is an excerpt from an article by Fallows that appeared in The Industry Standard.
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