Will Silicon Valley Remain the Center of the Tech Universe?

Silicon Valley is the hub of the technology industry, but is its status on the wane due to the high cost of living and a more mobile work force? Sure there are days when I’m tempted to live where the action is instead of Austin, but an Economist article showing the migration of workers from California helped remind me why I stay put.

It’s expensive to live and work in the Valley. Businesses have to pay higher salaries (check out the latest numbers from Glassdoor out today showing those salary averages in the tech industry), and also deal with onerous government regulations that benefit workers and the social good, but come with a cost. It’s also expensive for employees living there in terms of high housing costs, high income taxes and a variety of other expenses.

The Economist today published an article and fancy maps showing the migration away from the Valley. But while it blames high taxation, I think there’s another trend at work here — broadband. Dr. Mohit Kaushal, director of health care for the FCC’s Broadband Strategy Initiative, put it very succinctly earlier this year when he told me that broadband has the ability to eliminate temporal and geographic boundaries. And that is giving people a freedom to pursue their jobs, especially those of us in technology, in areas of the country where that may have been impossible a decade ago.

Our society will take a while to catch up (as will our infrastructure), but for those who have fast connections and the type of profession and company culture to embrace remote working in a wide scale, they can be part of a distributed workforce. This isn’t about outsourcing to India; it’s about having the level of geographic freedom once reserved for consultants and perhaps freelancers. So while there’s a meme in the tech press pitting New York against Silicon Valley, the real meme may well be pitting the Valley against anywhere else.

Right now, there’s capital, big companies and inertia keeping a huge number of startups, employees and businesses in Silicon Valley, but for how long? The economics are the same — or perhaps marginally worse for California businesses lately — but the technology has changed. Has it changed enough, or will the Valley continue to draw in the lion’s share of technology talent?

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