Walt Plosila likes to talk about the future. But, really, the car accident of the future?
Yes, really, says Mr. Plosila, president of the Montgomery County High Technology Council in Rockville. Picture this, he says: A car flips, and the driver has spinal injuries. Paramedics arrive with equipment unlike anything available today. Their machines not only take a high-resolution image of the driver's spine -- while he's still inside the car -- but also beam it to the hospital.
To Walter H. Plosila, that story carries both hope and warning. In the 21st century, communications webs will tie the world together -- even more tightly than today. Accident victims will benefit -- as will business people who can communicate faster, cheaper and more comprehensively.
And those communications webs should offer a nice little present to Maryland's information technology industry, tied just as tightly in a nice little bow.
After all, the businesses created through such innovation could be endless, and there's every reason those spinoffs should happen here. Maryland has an established telecommunications industry and university base, it is slowly getting better at transferring research from lab discovery to marketable product and its region has the highest concentration of federal research in the country.
But then again, Mr. Plosila points out, the imaging equipment that saves the car accident victim could be made in any state. Maryland's employment in some segments of the information technology business has been shrinking since 1986, despite industry growth, and the in-state industry's base of defense work and other government contracting has seen better days. The opportunity of the next decade is huge, he says, but eminently blowable.
"We have a good base here," Mr. Plosila says. "But we're not taking advantage of it, and it's not going in the right direction."
That's what Mr. Plosila and others are trying to reverse. Along with much of the electronics industry and university sector, the High Tech Council is pushing a proposal to build a Maryland Information Technology Center. Plans call for the center -- which could open within a year -- to be a high-tech networking center.
The focus won't be on basic research -- the center will do little, if any, of that. Instead, the focus will be turning Maryland's research base into products and jobs.
The stakes are high. The information technology industry employs an estimated 125,000 to 150,000 people in Maryland, at an average wage 70 percent higher than other jobs in the state. "If we can just hold our market share, we'll do well," Mr. Plosila said. "But it's not clear that we're going to maintain our share."
In theory, universities, companies small and large, and government researchers can work together at the center to develop new applications of emerging communications technology and to tailor the innovations to their needs.
Companies could catch up on the latest marketing developments, courtesy of the center's staff. Equipment makers could train workers and equipment users, or could test new products on an elaborate communications network that Bell Atlantic Corp. has agreed to make available in Silver Spring. Software makers could spend time with hardware makers to learn more about the next generation of products.
At bottom, the idea of the MITC is that all this networking will help Maryland high-tech firms (as well as the service companies who will use this technology) compete globally in a time when it will simultaneously become harder and more important to do so. Maryland communications companies need to loosen their grip on corporate individualism and competition to keep up with foreign competitors, who are ahead on the most important research and who have a better record in commercializing technology.
"We win our Nobel Prizes for research, but we don't win awards for product development," Mr. Plosila says. "We need somewhere to pull our capabilities together. . . . The Japanese don't shy away from competing once they get to the marketplace, but they don't shy away from collaborating before they get to the marketplace."
The center, an implicit challenge to laissez-faire ways of doing business, straddles a delicate line. American business always has bristled at strong oversight from government or outside agencies, so the center's backers painstakingly deny that they're trying to guide high-tech development with Japanese-style industrial policy.
They are careful to say that the Maryland MITC won't be like the powerful Japanese Ministry of International Trade and Industry, or MITI. They know business won't accept the center if it's an instrument of state control.
"It's different in that we haven't said, 'This is what we're going after and the government is nakedly going to make alliances with particular industries,' " says Selig Solomon, director of the Office Technology Development in the state Department of Economic and Employment Development. "You can't do it. It goes against the American corporate culture."
The center can guide technology development with its budget and can bring people together who will take technology in certain directions. But it won't issue mandates.
"What works is a partnership," says Rudolph Lamone, dean of the University of Maryland's business school and member of a committee that helped write the MITC's business plan. "That's what this is. . . . That's industrial policy of a different type than something purely government-led or government-directed."
If the purpose of the MITC is to help the state's information technology industry usher in a new communications revolution, Walt Plosila looks like a most unlikely ringleader.
That Ph.D. after his name isn't in engineering -- it's in public and international affairs. For someone whose mouth can be so bold sometimes, and whose mind is so highly praised, he can initially come across as much milder than he really is.
But ringleader he is. The MITC business plan contains nine pages of names of people who served on committees for planning research, marketing, technology transfer and other services. They come from state and federal government, industry and academia. Mr. Plosila's name appears on every committee.
And he's not shy about his role.
"I'm a translator between science and business, neither of which understands the other very well," Mr. Plosila, 46, says. "I guess I'm a visionary who likes not just to have a vision but to see it developed. One weakness in our society is a lack of vision. We're so specialized that we forget to see the forest for the tree."
Walt Plosila is a set of paradoxes. He has a strong ego, but keeps it in check. He's pushing an idea based on a passionate belief in the power of private investment to effect change, but he's never worked full-time in the for-profit sector. And he's a Republican (a liberal Republican, if you remember those), but he believes in government's ability to help business.
He's a thinker, but he's also a salesman and network-builder. As deputy secretary of commerce in Pennsylvania, where he served from 1983 to 1986 before joining the Montgomery High Tech Council, he masterminded an economic development program called the Ben Franklin Partnerships.
The Franklin partnerships offer challenge grants that match private investment in new technology, management assistance and other help to entrepreneurs, and training programs for high-tech workers. It was lauded as a national model in a 1988 book published by Harvard University Press. Matter-of-factly (and accurately), Mr. Plosila says, "It's looked at as one of the granddaddies" of other states' programs.
"He put together what most people still think is the best overall state high-tech program in the country [in Pennsylvania]," says Thomas J. Chmura, deputy director of the Greater Baltimore Committee. "He thinks that you can understand how industry works, and design public policy to intervene. Adam Smith
wouldn't have had any of that. The Japanese are more heavy-handed [in their intervention] -- Walt's more surgical."
The center could open in as little as six to nine months, Mr. Plosila says. It will start its life in leased space near Silver Spring, where Bell Atlantic Corp. has agreed to let the center use a $20 million demonstration communications network.
The center's backers will launch a national search for a chief executive this spring -- a job Mr. Plosila says he won't seek.
The center's start-up funding is still falling into place. Backers have already raised $3.2 million from private sources, and are trying to win grants of $500,000 in federal money. In years to
come, Mr. Plosila says, the center's federal money won't come from grants -- the center will pursue contracts to do research for federal agencies. Financial plans also call for the state to contribute $1 million a year -- but only for the first five years.
"The federal money should exceed the state money in the long haul, and the private sector money should exceed both," Mr. Plosila says.
From the start, the MITC was designed to be different from other state- or federally-supported research centers. It's not really supposed to do basic research -- its job will be turning existing research into products.
"It's an effort to solidify the technical information we have, make sure it's leading edge, and make other places come to us," says Mr. Solomon, the technology office director. "I don't deny that I'm more crass than the federal government. The federal government isn't interested in turning a buck. I am."
The planners of the MITC quickly settled on three branches of technology for the center to stress. Two are network management, or the art of linking groups of computers and other communications equipment, and imaging technology, which creates pictures from digital computer data and can include everything from computer monitors to sophisticated medical diagnostic machines. Imaging is no chump of a business -- industry sales are $2 billion annually and state economic development experts forecast 50 percent annual growth through the early 1990s.
But even so, the most important of the technologies refined at the center is expected to be Integrated Services Digital Networks, or ISDN.
"ISDN is a unified system that serves voice needs, data needs, fax needs," says V. David VandeLinde, dean of the G.W.C. Whiting School of Engineering at Johns Hopkins University. "There's no question we're going to ISDN. The question is the slope of the curve."
Broadband ISDN, the most advanced ISDN technology under development, will allow communications networks that can receive and send more frequencies. Remember AM radios? Now, with a broader band, ordinary household radios can also pick up FM or television sound.
Broadband ISDN is a similar advance. See that box on your desk that transmits and receives data? The phone that picks up a voice? The fax machine over in the corner? The video camera that gets used for not much of anything, if your office has one at all? Get ready to kiss 'em goodbye.
Those machines can't talk to each other without a modem because each works on a transmission band too narrow to include the others. Broadband ISDN will make them all compatible, and then they can all run out of the same box, or at least out of the same wall socket. The fax machine can be built into the computer. The camera's video image can be sent over telephone lines, while documents and graphics are moving back and forth over the same network -- a breakthrough for teleconferencing.
Sure, much of this can be done now. But it can't be done as conveniently or as efficiently. "There's nothing a telephone does that signal flags don't do," Dr. VandeLinde says. But just as a telephone is more convenient than flags, ISDN technology will be far more efficient than today's machines.
Mr. Solomon foresees Hopkins professors routinely teaching students in Europe from Baltimore via teleconferences, with computer links allowing students and teacher to pass papers and data back and forth. Mr. Plosila believes another major beneficiary will be the professional services sector, the bedrock of Maryland's employment base.
"Increasingly, it's going to be cheaper to move data around than to move people around," says Dr. VandeLinde, who is a member of the MITC's steering committee.
Combine digital network switching technology with the emerging use of fiber-optic cables, which have more versatility and capacity than copper wire systems, and the whole economics of communications changes, Alex. Brown & Sons Inc. analyst John P. Rohal argues. The volume that digital systems can handle pushes the cost of moving single pieces of information virtually to zero, he wrote in a recent essay.
And then the fun starts.
"Conventional wisdom sees communications as a mature, low-to-moderate growth industry," Mr. Rohal wrote. "We have a different view. . . . Fiber optics-based communications use [has] the potential for explosive growth. . . . We now appear to be in the early stages of attracting new applications, and the opportunity to dramatically increase the volume of information being communicated is yet to come."
Mr. Plosila says the point of the center is to help channel some of that growth into Maryland. He said new communications networks will transform the information society as profoundly as interstate highways overhauled the movement of manufactured goods. Using today's technology will be as unimaginable as shipping chickens from here to Florida and telling the driver to stay on U.S. 1.
But he admits that no one really can guess just how many applications there will be. "There's this joke about ISDN -- it stands for I Still Don't Know," he says.
The MITC's basic plan is in large part a reflection of Mr. Plosila's own travels and approach. Like European consortia he studied for a law review article published last year, the MITC will be non-profit and independent of government, though federal and state grants are being sought for start-up expenses. The consortium's role will be to catalyze decisions, rather than impose them on member companies and universities. And the consortium will rely on frequent surveys and other outreach to members to keep the MITC's work relevant.
"The organization and structure we certainly have borrowed from what has worked both in the U.S. and abroad," Mr. Plosila says.
The MITC will also keep its work relevant to what members are doing by letting them decide how 40 percent of their dues money is spent -- the other 60 percent goes to projects selected by the center's board. Mr. Plosila calls it letting consortium members vote with their dues.
The center did its first survey as part of its business plan to see what services the state's information technology companies think they need the most. The top two: marketing help and technology transfer (moving from research discovery to marketable product). The surveyed companies also requested joint product-testing facilities, collaborative research and an incubator for new companies. Mr. Plosila and others say different companies will use different services, to the point where it's hard to tell who the biggest winners will be if the center gets off the ground and works the way its sponsors hope it will.
"First, it [the winners] will be small- and medium-size firms who don't have access to these facilities and services," Mr. Plosila said. "They can't afford them and they're not available."
But he insists that bigger companies will also get their benefits. "Innovation in this country comes from small firms," he said, and bigger companies can tap into smaller firms' innovations by meeting entrepreneurs through the center.
Mr. Solomon said the biggest commercial winners from the development of ISDN will be phone companies such as C&P; Telephone, because so much more traffic will go over telephone lines. Dr. VandeLinde at Hopkins said small companies will benefit more from collaborative research done at the center because big companies can afford to do any research the center will be able to mount. "Specialized-niche companies come out of collaborative research that small companies can take hold of," Mr. Lamone added.
The chief scientist of one major-company supporter of the MITC says it will be a good way to generate business indirectly, even for companies that can afford their own research and technology transfer efforts.
"We're interested in flexing the muscles of satellite communication," says Joseph Campanella, vice president and chief scientist at COMSAT Laboratories in Clarksburg, a unit of Washington-based Communications Satellite Corp. The center will be a forum for COMSAT to show people what satellite technology can do, even if the company develops most of its technology in-house, he said. "It's a connection point, a center from which to work."
But even the center's most committed backers quickly admit that consortia like the MITC aren't panaceas. And they don't guarantee wild success.
Whether the MITC flies or not, Japanese and European companies will also be pushing the technology forward -- maybe even faster than the MITC. Despite the creation of Sematech, the Texas-based semiconductor industry consortium, Japanese semiconductor firms have continued to push into the U.S. market. And consortia such as Sematech have been plagued by troubles in keeping their members -- who have diverse financial and scientific interests -- pulling in the same direction.
"I can't say they've been great success stories," says Mr. Lamone, who is also a board member of a company that moved to Texas to be near another computer-industry consortium, one which on paper has a lot in common with the proposed MITC. "It's very tough for companies to get in and play without worrying about losing comparative advantage in a technological breakthrough" if other consortium members know about it, he said.
"One of the big issues has been how do you hold it together," Mr. Plosila said. "It requires a certain kind of skill in employees . . . The best way to make it industry-driven is for members to vote with their dues, and their feet."
Dean Lamone says the center's potential to help the state -- through jobs, tax revenues and general prosperity -- is large but by no means automatic.
"Conceptually, it's a hell of an idea," he said. "It's going to take a lot of work."