Issues

Mike Montgomery: Title II And Common Carriers: How The FCC Can Save Net Neutrality And Still Ruin the Internet

By Mike Montgomery

Prolonged discussions of Federal Communications Commission regulations are typically about as stimulating as a fistful of Ambien — except when it comes to net neutrality.

With the FCC poised to issue new rules governing how Internet service providers manage and price the traffic that flows through their networks, Americans woke up and spoke up so loudly that they crashed the agency’s website last month. The million-plus comments from concerned citizens were the most the FCC has ever received during a proposed rule’s public comment period — and just a few hundred thousand shy of the number of complaints that poured in after Janet Jackson’s infamous “wardrobe malfunction.” When we’re comparing tech regulations to Super Bowl nipple slips, you know we’re in a different kind of debate.

You probably haven’t had a chance to read all 1,067,779 comments. Neither have I. But most support an outcome preserving the wide-open Internet that birthed our current era of innovation, transformation and disruption. The question now is how to achieve this.

The debate so far has been oversimplified: Are you for net neutrality or against it? That reductive framing may lead us to embrace a solution that doesn’t solve the problem.

From where I sit at CALinnovates, representing tech companies dependent on the open Internet to survive, this debate is incredibly important. Disruptors like ride-share platform Sidecar and conference-call service Speek shouldn’t be forced to bid against deep-pocketed giants — or anyone, for that matter — for their share of bandwidth. Nor should they be forced to adapt to regulations that would suppress new ideas or hamstring the entrepreneurs who hatch them.

They, along with countless other startups and aspiring innovators, agree: We need an outcome that preserves the openness of the Internet.

Unfortunately, it’s not so simple. Let me explain. The leading proposal in Washington to achieve that goal is to reclassify broadband providers as “telecommunications services.” This would allow the FCC to regulate providers using authority granted it under Title II of the Communications Act of 1934.

As you have undoubtedly noticed, the Communications Act of 1934 was passed in 1934. That means the FCC is gathering input as it considers adopting the same legislative framework for the Internet that existed back when “wireless” meant the hand crank on your grandparents’ AM radio.

Title II turned our nation’s telephone system — a single network operated by a single company, Ma Bell — into a highly regulated utility, just like water and electric companies. While they helped protect consumers from the excesses of a corporate monopoly, Title II’s restraints hardly made that phone network an innovative one.

Ask your parents: Under Title II, innovation in telecom meant being able to buy a different color of the same phone chosen by the monopoly at a price set by the government. This same law can’t accommodate today’s sprawling, bustling, magically fragmented Internet, a miracle of technology unimaginable in 1934 — or even in 1996, when the act was updated for the “modern” era.

By turning the Internet into a utility, we’ll bleed tech innovation with a thousand paper cuts. Would we even know what an iPhone is if Steve Jobs had to run his pricing models past the FCC? Would Twitter be fomenting revolution if Jack Dorsey needed to check with regulators about what kind of data can be shared online and by whom?

It sounds far-fetched, but that’s how it would work. Under Section 214 of Title II, common carriers have to ask for approval before discontinuing nonperforming platforms or launching new ones.

Shoehorning Internet companies into Title II and treating them as common carriers won’t just slow Silicon Valley down to Beltway-at-rush-hour speed; it will also render impossible a great many things that have become part of our daily routines, like using on-demand services from location-based smartphone apps.

Under Section 222 of Title II, companies have a duty to protect the confidentiality of customers’ proprietary network information. Sounds benign, right? Well, it means wireless location data could no longer be shared with Internet companies for mapping or advertising. Location-based companies would be limited by, in the regulators’ lyrical stylings, the “use or disclosure” of “call location information concerning the user of a commercial mobile service.” In plain English, that means companies like dating service Tinder, car navigation service Waze and ride-sharer Uber could soon become relics of the past. At the least, they would have far higher hurdles and costs in launching and attracting investment capital.

The big losers in all this would very likely be startups and the consumers they seek to serve. For large, established digital companies, these new regulations would probably just be an inconvenience. For startups that don’t have the resources to fight Title II classification, or the in-house legal teams to interpret the new requirements, the rule changes would be a death knell.

Before we trade the devil we know for the devil our grandparents knew, we should pause to ask ourselves whether legally defining the Internet as a utility will keep it both open and innovative — or act as a drag on creativity and growth.

I’m pro-net neutrality, but anti-1934-style strangulation. Where does that leave me? According to the approaches under consideration, I may soon be a man without a country. Good thing the Internet, at least for now, doesn’t require a passport.

Mike Montgomery is the Executive Director of CALinnovates,

This piece was originally published in The Huffington Post.

Mike Montgomery: New Report by Faulhaber, Singer, And Urschel Shows That In Tech-Driven Economy, FCC Needs To Step Up

By Mike Montgomery

It’s clear that technology is a key driver of prosperity in today’s modernizing economy. Trillions of dollars in economic activity flow through the networks which make up the internet, making America’s digital economy the envy of the world. Networks are redefining the services people consume and the income people derive. For example, according to a Pew survey, 72 percent of Americans have used a sharing or on-demand service.

That’s why the Federal Communications Commission has never been more important. From last year’s Net Neutrality rules to current proceedings about set-top boxes, internet privacy and business services, FCC rules are shaping the future of the internet – and the broader economy that it fuels. Whether you agree or disagree with these regulations, everyone agrees they will have a profound impact.

That is why it’s so disconcerting to see the FCC disconnected from the economic impact of its decisions. In a report he published in July, the FCC’s very own former chief economist, Gerald Faulhaber, Ph.D., along with economists Dr. Hal Singer and Augustus Urschel, raised alarms about the agency’s dangerous turn away from economic analysis in its decision making.

In the report, Dr. Faulhaber, Dr. Singer, and Urschel ask: Why do the U.S. Department of Labor, the U.S. Environmental Protection Agency and the Consumer Financial Protection Bureau all conduct stringent cost-benefit analyses on their decisions while the FCC does not?

The FCC has simply become too important to the economy for it to fail to explore the economic impact of its decisions. For example, numerous economists warned the FCC that its decision to impose so-called Title II regulations on internet service providers, which treats today’s advanced broadband access in the same way as telephone services from generations ago, will have a negative impact on investment and innovation while not solving the issue we all want addressed: how to ensure that internet traffic is treated fairly across networks, regardless of where it comes from. Yet, when issuing its Open Internet Order, the FCC conducted no economic analysis of the impact its proposed rules would have on consumers, innovation or investment.

How is that possible?

The problems continue. The FCC is currently facing a major backlash from Congress, Hollywood and many innovators for its proposed new technology standards for set-top boxes.

Economists and legal analysts, including Harvard’s Laurence Tribe, are protesting a new FCC proposal to apply stifling “opt in” rules for internet privacy – distorting the market by creating arbitrary and inconsistent requirements for the same data when it is used by different companies and precluding companies from even the most mundane communications with their customers.

The agency is even considering abandoning years of economic precedent on whether and how markets should be regulated to impose rate regulations in business services where competition is thriving.

How the country utilizes spectrum is another issue where the FCC seems intent on picking winners and losers instead of maximizing the economic value of this public resource. In other words, once again, economics is taking a back seat to some other agenda.

If the FCC had undertaken rigorous economic analysis and evaluated the costs and benefits of these proposals it could have avoided these controversies and worked toward genuine consensus on pro-consumer, pro-innovation policies. That is what we should expect from a government agency that is supposed to be a subject-matter expert.

Traditionally, responsibility for managing the economy fell to the White House, the Treasury Department and the Federal Reserve — all economically expert operations. But the FCC is now elbowing its way into this mix by flexing jurisdiction over the internet and much more. But as the saying goes, with great power comes great responsibility.

So what can be done? If the White House isn’t prepared to insist the FCC factor economic impact into its decisions, it will be up to Congress.

Lawmakers have many tools at their disposal. Oversight hearings can shine a light on how the FCC makes its decisions. Congress can ask the Government Accountability Office to investigate how the FCC factors economics into its decisions – or fails to. And, of course, if Congress thinks the FCC has made decisions based on faulty or no economic reasoning, it can pass legislation to overturn faulty rules.

Hopefully the FCC will take stock of the criticism from people – like Faulhaber– who know it best, and make changes that will help the agency take the economic impact of its decisions into account.

After all, if the FCC wants to sit at the “adult table” when it comes to deciding our economic future, the very least we can expect them to do is their homework. According to Dr. Faulhaber and others, the agency hasn’t earned that seat just yet.

Mike Montgomery is executive director of CALinnovates, a San Francisco-based technology advocacy coalition.

This piece was originally published in Morning Consult.

Retail Isn’t Dying, It’s Being Revolutionized

By Kish Rajan

There’s almost nothing more depressing than the sight of a dying mall. If you’ve ever walked through one of these places, you know the sadness of the empty store fronts, the echoing atriums and the going out of business sales at the few remaining shops.

It’s enough to make anyone think that we’re witnessing the end of in-person shopping as we transition to online purchasing. But don’t let those sad malls fool you. Retail is far from dead — but it is evolving in ways that could benefit both shoppers and workers.

First, it’s worth noting that the death of brick and mortar shopping has been greatly exaggerated. E-commerce only accounts for 10% of retail overall. According to NPD, 95% of Americans shop at Wal-Mart while only 42% shop at Amazon. And those dying malls? They’re more a sign of overdevelopment than a harbinger of the obsolescence of retail. The number of malls in the U.S. grew more than twice as fast as the population between 1970 and 2015 according to research from Cowen & Co. What we’re seeing now is more of a rightsizing than a decline.

And many malls are reinventing themselves. Take the Westfield Mall outside of Los Angeles. Located in the heavily Asian San Gabriel Valley, it’s often almost impossible to find parking there on the weekends. Once a sleepy shopping center stocked with the usual suspects, the mall is now home to outposts of hot Asian retailers like SST&C out of Taiwan and Muji, a Japanese lifestyle store.

You see this kind of rethinking of retail everywhere you go. Online stores like Warby Parker and Modcloth are popping up in real life around the country. At the same time classic brick and mortar shops, like Nordstromand Best Buy, are using their physical stores to help drives sales online and vice versa.

This kind of creativity is exciting but it is just part of the overall evolution in retail. As more shopping moves online, it’s inevitable that we’ll see a change in the overall demand for different kinds of workers. Just look at Amazon Go, the online retailer’s latest foray into the real world. The Settle-based supermarket will work completely by automation. You just take what you need and leave and Amazon charges your account without requiring any human interaction at all. It’s a delight for shoppers but could dramatically reshape the number and types of jobs in future grocery stores.

As low-paid jobs fade, they’ll be replaced by higher-paying jobs in both physical and online retail. A recent study by the Progressive Policy Instituteshows that while retail saw a gain of 27,000 jobs last year, ecommerce jobs climbed by 97,000. Those ecommerce jobs pay an average $21.13 compared to an average $16.65 per hour in general retail.

But the trick will be moving displaced workers into better jobs that will pay more. It’s naïve to think that a laid-off cashier in a small town in Alabama can just pick up and move to a higher paying ecommerce job that might be located in Washington state.

In order for the new economy to benefit everyone, we have to make sure these new jobs are available to everyone. We can do that by ensuring technology jobs are spread throughout the country, not just concentrated in places like Silicon Valley and Boston. Smaller towns can become tech hubs. Just look at what’s happening in Augusta, Ga., where a group of entrepreneurs are building incubators and helping to create a tech-friendly environment.

We also need to laser focus on retraining workers. That means tech companies and government working together to come up with smart new ways to train people. One good example of this is TechHire Eastern Kentucky. Launched by Ankur Gopal, the CEO of Interapt out of Louisville, Ky., with support from the local government, the program trains people through class study and apprenticeships to move into tech jobs.

If we are to successfully move to the next phase of retail, which will be a mix of brick-and-mortar and ecommerce, we need to make sure there are new and better opportunities for workers. Those opportunities will come from creative new shops as well as good-paying tech and warehouse jobs. It’s a mix that will be good for customers, and good for employees.

Kish Rajan is Chief Evangelist at CALinnovates.

CALinnovates Statement on the Appointment of Commissioner Jessica Rosenworcel to the FCC

According to multiple reports, the White House has decided to nominate former FCC Commissioner Jessica Rosenworcel to return to the agency. We join a bipartisan chorus in declaring that it’s about time.

Should Rosenworcel’s appointment be confirmed by Congress, her return to the FCC will inject an even greater amount of wisdom and forward-thinking to this currently condensed policy-making body. As we noted when she was initially appointed to the FCC in 2012, and as Senate Minority Leader Chuck Schumer has correctly pointed out, Rosenworcel understands the rapidly changing nature of technology and the important role the tech sector plays in the innovation economy. Among the many issues Rosenworcel has championed that will return to the regulatory discussion include a vital continuation of the education and advocacy she continues to lead around the closing of the homework gap. The FCC and the nation will be well-served by her experience, expertise and intellect.

“Americans from Silicon Valley to the Hudson Valley will benefit greatly from Jessica Rosenworcel’s reappointment to the FCC. Welcome back, Commissioner Rosenworcel. You’ve been missed,” said Mike Montgomery, CALinnovates executive director.

Solving Infrastructure Problems From the Bottom Up

By Kish Rajan

Walking down the streets of San Diego, it’s not immediately apparent that the city is at the center of a technological revolution in infrastructure. That’s because the technology, 3,200 sensors, is hidden inside the city’s new street lights. The sensors collect data that will help the city save $2.5 million on electricity each year, track air quality, and improve traffic flow and parking. They can even be of use to public-safety first responders.

San Diego’s smart lights are just part of the city’s push to rebuild its infrastructure. Last June, voters approved the Rebuild San Diego ballot initiative, which will provide up to $4 billion for infrastructure projects over the next 25 years.

Expect to see more local and state governments taking infrastructure problems into their own hands. Given the realities of politics in Washington, they know the folly of waiting for the federal government to step in and save the day. And it’s highly unlikely that any new infrastructure plan that did emerge from Washington would cover more than a fraction of the $4.6 trillion that the American Society of Civil Engineers (ASCE) estimates it would cost to fix everything — more than the federal government spends in a year.

ASCE’s latest report card gives America’s infrastructure an overall grade of D-plus. And no one knows better than those at the local level how our deteriorating infrastructure makes us less competitive globally, not to mention the safety concerns it raises for the people who use crumbling bridges, overpasses and tunnels every day or who drink water that might be contaminated by sewage overflows, just to name a few issues. They need to take a page from San Diego’s playbook and find creative ways to start solving infrastructure problems from the bottom up.

It’s already beginning to happen. South Bend, Ind., for example, is a sewer overflow city. Hundreds of billions of gallons of raw sewage overflow into local rivers and lakes every year. Aiming to improve the situation, the city, under Mayor Pete Buttigieg, has begun using a system called CSOnet, developed by a local company, that collects data from sensors inside the sewers so the city can redirect water to empty pipes and reduce the overflows.

In Multnomah County, Ore., more than a third of the commercial buildings use more energy than they should. But the Building Ready Multnomah initiative, started by former County Commissioner Jules Bailey, helps finance capital improvements that reduce energy consumption or generate energy. The organization leverages public and private resources for the loans and encourages participants to use the savings generated from becoming more energy efficient toward seismic upgrades to prepare for natural disasters.

And as some Western states struggle to build up their renewable-energy infrastructure, other states, including California, have excess renewable energy capacity. California state Sen. Bob Hertzberg has proposed the creation of a regional grid operator and energy exchange to make it easier for states to buy and sell energy to each other, which could reducing overall carbon dioxide emissions.

These efforts might seem small, but they can add up to a serious impact. With the continuing dysfunction in Washington, it may be years before we see a comprehensive federal infrastructure effort. But as these local leaders have shown, that doesn’t mean we can’t begin to improve our grade.

Big Data Will Help Revolutionize The Pot Industry

By Mike Montgomery

Getting a Rocky Mountain high may soon be legal in all 50 states, which means pot is fast on its way to becoming just another industry, albeit an exploding one. And as the marijuana industry comes aboveground, it’s opening a huge space for the usual disruptors — tech startups and data analytics firms.

Startups like Eaze in California began with medical marijuana, using technology to provide on-demand marijuana deliveries via an app. Eaze also provides data to help retailers predict supply and demand. MJ Freeway offers an agricultural tracking product that helps marijuana license holders manage their businesses and comply with regulations in Colorado. Both companies can be scaled up easily as more states come online with recreational use.

Dozens of other startups are devoted to finding ways to use technology to improve mundane tasks, including human resources, transportation, regulatory compliance, insurance and mobile payments.

On the analytics side, Cannabase is a Colorado-based wholesale market that treats marijuana just like any other commodity. It provides real-time market insights to wholesale growers and retailers, helping them anticipate market trends, price changes and volume fluctuations in both the medical and recreational markets. Cannabase also provides analytics to advertisers looking to market to growers and dispensaries. “Data-driven operations are the ones most likely to survive,” says Jennifer Beck, Cannabase co-founder.

Beck is talking about when marijuana is legalized across the U.S. Right now, it is still a Schedule 1 drug, regulated in the same manner as cocaine and heroin. But a trio of new bills proposed by members of the Congressional Cannabis Caucus in the House of Representatives brings federal legalization one step closer. The Regulate Marijuana Like Alcohol Act is self-explanatory, while the other bills pertain to pot-industry taxes and reforms to banking and research regulations.

Although it’s legal for recreational use in just a handful of states, marijuana already is the fastest-growing industry on the planet, according to Arcview Market Research’s 2017 report on the marijuana market. Sales hit $6.7 billion in 2016 — a 34 percent jump from the previous year. Arcview expects the legal marijuana market in North America to be nearly $23 billion by 2021 — all without federal legalization.

Those are the kinds of numbers that draw venture capital. The total amount of capital raised by cannabis companies in 2015-2016 was more than $2 billion, up 45 percent from the previous year, according to Arcview, which itself has invested $118 million in more than 145 companies.

Another cannabis VC company is Poseidon Asset Management, which has more than $15 million invested in technology firms like Headset and Wurk. Poseidon invests mostly in ancillaries — genetic research, biotech, agtech and, of course, data analytics. “The industry is evolving and that’s where technology companies come into play,” says Emily Paxhia, managing director of Poseidon Asset Management. “It’s being powered by people who are entrepreneurial in spirit and willing to participate when it’s still a little more high-risk.”

When legalization happens — and it will — companies with access to big data will have a big advantage in the multibillion-dollar market. As legalization spreads, prices will decline and the number of products will explode, making branding and marketing vital. Big data in particular is necessary to gain insight into the potential of the pot industry. “Data allows people to make informed decisions, track trends, merchandise products and advertise effectively,” Paxhia says. “From a regulatory standpoint, this is critical to demonstrate the evolution of the industry.”

Right now, the entire legal-marijuana industry is a somewhat unknown space, but soon it will be filled with unlimited data on sales, markets and consumer behavior. “The rest of the business and innovation world is infatuated with data, and there is no reason for cannabis to be the exception,” Paxhia says.

Could One Of Italy’s Most Beautiful Regions Emulate Next Silicon Valley?

Tourists flock to the region of Liguria in Italy for the area’s natural beauty. Nestled against the Mediterranean at the northern tip of the Italian boot, Liguria boasts the Cinque Terre, a string of five picturesque fishing towns connected by idyllic hiking trails.

But according to Marco Bucci, Liguria is rich in another resource: tech talent. Bucci, who is running for mayor of Liguria’s biggest city, Genova, joined Mike Montgomery and Jeff Capaccio, of counsel at Silicon Valley law firm Carr & Ferrell, a member of CALinnovates’* Advisory Board and the founder of the Silicon Valley Italian Executive Council to talk about the potential for the region.

Bucci believes that by reducing taxes, better marketing Liguria and utilizing best practices from Silicon Valley, he can help turn Genova into an Italian tech hub.

The region has home-grown potential with academic institutions as home to the Italian Institute of Technology and the University of Genova which has an excellent engineering program. The trick will be getting students from those schools to stay in the area and avoid the brain drain that has affected the area for far too long, according to Bucci. Bucci says that will be one of his top priorities if elected.

Click to listen to this podcast and don’t forget to subscribe to A Step Ahead on either Soundcloud or iTunes.

*CALinnovates does not endorse candidates.

SCOTUS Smacks Down Patent Trolls

By Mike Montgomery

In all the political hoopla dominating the news lately, many people probably missed a U.S. Supreme Court decision that will actually have a huge impact on technological innovation. On May 22, the court ruled to restrict where patent lawsuits can be filed. The decision is likely to lead to a reduction in the number of cases filed by so-called patent trolls. It’s about time.

Trolls don’t build anything, employ anyone or add any value whatsoever to the economy. They simply buy up overly broad, somewhat vague intellectual property (IP) patents and use them as cudgels to bully plaintiffs into paying them to go away. Trolls count on a trial being more expensive than an out-of-court settlement.

Until this recent decision, the trolls’ favorite place to bring suits was the Eastern District of Texas, which has rules — and juries — that favor IP plaintiffs. It’s not a huge surprise that more than 40% of all patent lawsuits are filed there. One East Texas judge oversaw more patent cases than the federal judges in California, Florida and New York combined. The region became a troll haven partially by accident, but mostly by design. All those lawsuits — more than 2,500 last year in the region— bring in legal teams that spend money at area hotels and restaurants and usually even throw a few crumbs to the local legal talent.

But the SCOTUS decision sounded a death knell for their cottage industry. In the two weeks preceding the ruling, 74 patent cases were filed in the Eastern District. The week after — just four cases. The well dried up fast. That’s because the ruling in Heartland v Kraft means patent cases must be filed where the infringement took place, or where the defendant has an established business. That’s usually not East Texas.

This decision is going to make a huge difference for startups and small businesses that can’t afford to fight expensive legal cases in far-flung towns, especially when the deck already is stacked against defendants. It’s easier to settle immediately, or to just not go down that innovation path.

Patent trolls waste billions of dollars each year and ultimately hurt consumers. Studies have shown that trolls syphon off money from research and development, venture capital investments and tech startups in particular. Patents are designed to protect investment and innovation, and they work in some industries like big pharma. But the tech industry has been crying out for reform.

Unfortunately, Congress has repeatedly refused to act, despite two bills that would reform the tech patent industry. The Patent Act would make it more difficult to file troll suits, while the Innovation Act would cut down on the broad, vague language used by trolls and, more importantly, force them to pay legal fees when they lose.

Of course, action may not be as necessary now. The new ruling most likely will make it harder for trolls to consolidate cases, thereby eliminating marginal cases and potentially leading to a reduction in the number of cases filed overall.

Mike Montgomery is the Executive Director at CALinnovates.

Farming Takes Flight

By Tim Sparapani

Ernest Earon was walking through a client’s farm recently when he noticed one of his company’s unmanned drones flying over the fields snapping photos. It was a heart-tugging moment for the entrepreneur. “Unexpectedly coming upon one of our aircraft, up there doing its job, was just a pretty cool moment for me,” said Earon, co-founder and chief technology officer at PrecisionHawk, a drone mapping and analytics company that helps users collect and analyze data coming from drones.

PrecisionHawk has been expanding throughout South America and Australia for years but was stymied in the U.S. by onerous regulations. After the FAA loosened those regulations in late August 2016, growers started adopting new drone technology at a breakneck pace.

It’s just one aspect of the booming “ag tech” (agricultural technology) field. Just this week, CB Insights identified more than 100 private companies in ag tech, sorting them into nine main categories including sensors, smart irrigation, and robotics and drones.

Farming has always been an information intensive industry: Growers need answers to hundreds of questions about air and soil conditions, plant stressors and optimal timing for everything from planting to harvesting. In the past, obtaining the data needed to answer those questions required thousands of hours and lots of workers. Many of today’s farms are efficient, data-gathering dynamos. Tractors have IP addresses, harvesters can measure the yield as it’s coming out of the ground, biometric sensors report on livestock health, and sophisticated algorithms help farmers manage tasks such as watering and seed ordering.

Researchers suggest the full-scale adoption of these technologies could mean an increase in farm productivity unseen since mechanization. The tractor, for example, led to a 140% jump in farm productivity between 1910 and 1950. Other mechanization, such as automatic harvesters and automatic planters that incorporated herbicides, spurred another climb of 170% between 1950 and 2010, says Michael Walden, professor of agriculture and resource economics at North Carolina State University. “That’s more than double the productivity gains in the nonfarm economy.”

Walden thinks we’re about to take another leap forward in productivity as more farmers adopt ag tech. “That’s what technology does,” he says. “It allows us to get more from less.”

Technology is important because “no one’s giving out new farmland,” says Earon. “The costs of spraying pesticides and fertilizers everywhere is too great. We have to do more with less. Farmers know the climate is changing. Everyone is looking for ways to get that leg up and continue to produce.”

Drones are a key part of the data gathering. They can cover large distances very fast, take high-resolution photos and fly over fields without affecting crops, all at a relatively low price.

“We put a lot of different sensors on them and can collect the exact insights you need to address the problem in front of you,” says Earon. “They see that the section of the field with drainage issues — which we know about because we’ve done 3D modeling — lost a lot of nitrogen because of the rain and we need to reapply it. The drone is collecting the information and providing that insight back to the grower.”

So far, adoption of data technology is highest where there are problems, such as on farms where drought or pests are present. It’s also getting easier to buy and use the technology. Drones cost as little as $1,000, and PrecisionHawk gives its software away for free. “We want as many people using it as possible so we get that feedback to help us make it better,” say Earon.

He’s already looking at a future where crops and sensors are developed together, and fewer humans are necessary to plant and harvest crops. “Farming is going to be less about driving tractors and a whole lot more about making decisions on what’s coming up next year,” he says. “Humans are not going to be involved except to manage the whole process.” There’s already a group in England attempting to grow a barley field without any human activity on the field itself using drones, driverless tractors and remote-controlled combines.

As technology takes over the rote parts of farming, different kinds of human work will be required. In fact, PrecisionHawk currently is staffing up on agronomists, geo-spacial scientists and other experts. Other drone companies in the farming space include TerrAvion, Agribotix and Skycision.

“Let the machines do what they’re good at,” says Earon. “Robots are very good at doing the same thing over and over and over again. They don’t care how hot it is. They just take good pictures.”

Humans, on the other hand, are good at using data to build new tools and figuring out new ways to use it. “We’re not putting people out of work,” says Earon. “We’re letting them do other things.”

Tim Sparapani is Senior Policy Fellow at CALinnovates.

SB 182 Will Help Move California’s Economy Into The 21st Century

By Kish Rajan

If you live in any big city in California, chances are you’ve used a rideshare service to go to or from the airport. It’s become such an easy option that most of us take it for granted.

But a lot of effort goes into making that ride so easy for you. And much of that effort comes from the drivers — independent entrepreneurs who have turned their cars in to rolling small businesses.   These small business owners enjoy the freedom, flexibility and rewards of being their own bosses — even if just for a few hours per week.

And while they are experts in navigating the streets of their communities where they drive, they can often be challenged by all the government regulations they have to navigate. Los Angeles County, for example, is made up of 88 different municipalities and each of those municipalities has its own business license standards for drivers. As they drive through different towns, drivers are subject to different licenses, fees and requirements.

Driving from San Jose to Oakland a driver goes through 5 different cities. All over the state, drivers are moving through different cities every day — and running the risk of getting fined for not having the right business license.

But to expect drivers to obtain licenses from every municipality they might go through is unreasonable. Most licenses cost around $100 each and those fees start to add up creating a serious barrier to entry for new drivers who are really entrepreneurs (87% of Uber drivers, for example, say they drive because they want to be their own boss). As a state, we want to do everything we can to encourage entrepreneurship and to help give people the freedom to change jobs and build new businesses. We don’t want to burden people with unnecessary regulations.

This is as perfect example of a modern industry operating under outdated regulations. Of course it’s important that people feel like they are in the hands of licensed professional whether they’re getting a massage, hiring a plumber or getting a ride. But forcing those businesspeople to get often redundant business licenses just because they cross a municipal line is old-fashioned thinking. In today’s economy, people need to be able to go where their customers are and that’s not always in the same town.

That’s why we support SB 182. The bill would allow drivers to obtain one business license that could be used across municipal lines. Drivers would be able to move freely around the state knowing they are licensed to operate everywhere; and passengers would get the assurance that they are in a car with a driver who has a business license in addition to the stamp of approval from the rideshare company.

The bill also stands to benefit the many different municipalities of California. Instead of having the state issue the business license, it could be issued by the driver’s home town. That way, if a driver is based in Livermore but mostly picks up riders in San Francisco, Livermore would get the benefit of the licensing revenue.

SB 182 also helps protect drivers’ privacy. Some jurisdictions publicly post addresses of people who apply for business licenses. Because drivers essentially work out of their cars, their home addresses have been made public. SB 182 would ensure that when drivers apply for licenses, their addresses remain private.

This bill should be seen as a model for legislation going forward. The sharing economy (or as I prefer to call it, the personal enterprise economy) is going to continue to be an important part of our economic mix. We need to make sure our laws and regulations are updated to protect workers as well as customers. SB 182 acknowledges that the world is changing and creates smart regulations that make sense in today’s world.

Kish Rajan is chief evangelist at CALinnovates and former director of Gov. Jerry Brown’s GOBiz initiative. He can be contacted at kish@CALinnovates.org.

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