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On November 21, 2016, Peter Hill commented on Three lessons from building the digital city :

Great question, MrNMS! I agree that wifi (and better cell service!) is a huge priority for subways. Transit Wireless has been working with New York City to improve wifi and cell service in the subways, but it’s a slow process. I remember the frustration on my commute of only having a few stations on the route have cell service, so I always knew the exact moment to pull my phone out to check email on the ride—not exactly what should be happening in a 21st century city.

It’s important to understand, though, that most of these interventions are not using taxpayer dollars. The MTA On the Go program is entirely funded through ad revenue, so Intersection takes all the risk. In the case of the LinkNYC wifi kiosks, there is also revenue sharing with the city—over twelve years, LinkNYC is expected to provide about $500 million back to the city.[1] This is a great way to allow for innovation while protecting taxpayer funds. Unfortunately, it’s a harder model to make work in less dense areas where ads are seen by fewer people and therefore command lower rates.

[1] NYC Dept. of Information Technology and Telecommunication, LinkNYC, [https://www1.nyc.gov/site/doitt/initiatives/linknyc.page] accessed November 2016.

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On November 20, 2016, Peter Hill commented on HomeKit – Apple’s next Big Thing? :

Exciting to see the number of major companies competing to make smart homes work. As Orly points out, Apple’s traditional strength has been its closed ecosystem and excellent “just works” UI design—entering the rapidly proliferating market of smart homes and the Internet of Things can make that challenging, but people still come to Apple because their ecosystem is reliable. I’m glad you mentioned both the potential of using the cloud to lower strain on local devices and wifi, and the need for strong security. Apple has taken a very public stand in protection of its users’ privacy, and security has long been a priority for the company. Because Apple is a hardware company, it’s in some ways surprising that they have not taken the route that Google/Nest have by creating their own set of products (Home/Made by Google and the Nest smart home products) rather than working closely with third-party providers. As Google and Amazon work to get their digital assistant products (Home and Echo) into every living room as a core interface for all their digital devices and eventual smart home products, it’s clear that Apple will need to make a similar move, or miss out on a massive opportunity. I wonder what follows the now two-year-old HomeKit.

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On November 20, 2016, Peter Hill commented on Smart City of Dreams :

It is indeed exciting to see all the progress being made toward smarter cities, but as JM points out, the business model behind these technologies is not always clear. As the technologies prove their potential to create efficiencies and savings, though, governments will likely become more comfortable with the investments, and others will be willing to finance projects with clearly understood returns.

Another concern about smart city technologies—particularly in regards to utilities—is the potential for security breaches. A few weeks ago, several major websites were shut down as the result of a DDOS attack mounted from Internet of things devices. With many individual devices containing few or no security protocols, we are creating a substantial risk. It is not unlikely that we will see more direct attacks on infrastructure using smart cities technology—when your city’s power, lights, and water supply are all connected to the Internet, you do run the risk of losing all three at once. While I’m excited about the opportunities that these technologies create, being careful about security is key toward long-term success and cities’ willingness to adopt the systems.

PH
On November 19, 2016, Peter Hill commented on Motivate: Spinning Today for a Better Tomorrow :

Not sure I follow your logic here, Bernadita.

If the cost of cars is not self-sufficient, why should we expect bike sharing to be? We heavily subsidize cars with the enormous investment in roads, not to mention the billions of dollars of subsidies for gasoline.[1] We have made nowhere near the same level of investment in bike-friendly streets, and until bike sharing programs, invested essentially no public money in bicycles. (CitiBike in New York does not take public funds, though it does use public space.) I agree that increasing the cost of using a car is beneficial for the environment, but improving the accessibility of bikes and bike infrastructure can also reduce car trips. A survey in Denver on the implementation of their bike-sharing system found that about 40% of trips directly replaced car trips.[2] There’s no reason to only use one potential solution to a problem—as a society we should be able to walk and chew gum at the same time.

I also disagree on the quality of the bicycles. I have been a member of both CitiBike in New York and Hubway in Boston. While I have seen bikes that need repair, there is a system in place to mark them as such at the docking stations, and technicians do repair them quickly. The heavy 3-speed design of the bikes is well-suited to urban environments and the short- to medium-distance trips for which they are intended. While you’re not going to go faster than a good road bike going at top speed on long straightaways, with the speed allowed by normal traffic conditions and lights in their intended urban setting, the bikes perform exceptionally well. Their heavier construction also makes them better at handling the potholes and debris that are often (unfortunately) found along the sides of the roads where cyclists are generally forced to ride. I’ve biked crosstown through a blizzard in Manhattan on a CitiBike quite successfully, conditions where I never would have considered using a traditional hybrid or road bike. On protected bike lanes, I also routinely passed people using traditional bikes on my CitiBike. Perhaps we can set up a race? Not sure I’d win, but I can at least beat half speed. 🙂

[1] Elizabeth Bast et al, “Empty promises: G20 subsidies to oil, gas and coal production,” Oil Change International, November 2015 [http://priceofoil.org/content/uploads/2015/11/Empty-promises_main-report.2015.pdf] accessed November 2016.
[2] Kaiser Permanente, “Denver B-cycle Finishes Successful First Season with 102,981 Rides,” December 7, 2010 [https://share.kaiserpermanente.org/article/denver-b-cycle-finishes-successful-first-season-with-102981-rides/] accessed November 2016.

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On November 19, 2016, Peter Hill commented on NEST: our real-life J.A.R.V.I.S?… Perhaps, but not quite yet. :

Great post, RM. That updated hierarchy of needs is becoming truer and truer. For over 30 years, the federal government has subsidized landlines for low-income people as essential “lifeline” communications service. It was just earlier this year, though, that the FCC finally added mobile voice and broadband service to the lifeline program.[1]

Following Greg’s point, I wonder what types of partnerships could help Nest get over some of the adoption programs you discuss. Working with traditional security systems is certainly one of them. Partnering with other home service providers to reduce their costs and improve service could be another path in—and a potential revenue source to take some of the cost burden off homeowners. Power companies are an obvious option here—smarter homes generally mean lower energy consumption—as are broadband providers, insurance companies, and potentially even retailers like Amazon that want to be as connected to a family’s buying needs as possible, and are also looking for ways to make the delivery process more seamless.

[1] FCC, “Lifeline Program for Low-Income Consumers,” [https://www.fcc.gov/general/lifeline-program-low-income-consumers] accessed November 2016.

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On November 19, 2016, Peter Hill commented on Sidewalk Labs: The Urban Parking Conundrum and its Digital Solutions :

Great post, TOMphia! I love this idea of aggregating parking spaces across multiple owners, public and private—it’s a more complete solution than what we discussed previously with dynamic pricing for just the most valuable city-owned on-street spots. The challenge in putting this together, as with many collective action problems, is aligning the incentives between all the players, as well as actually doing the work of negotiating the contracts with the private landholders one-by-one. That’s possible to do (telecom companies have to go through a similar process as they negotiate entry terms into buildings with individual landlords), but takes time. Aligning the incentives could be particularly difficult, though. Businesses that own free parking lots would be reluctant to charge for them during business hours, which would be a likely necessity if they are aggregating supply across all spaces in an area. There are solutions (such as businesses using new parking revenues to pay for their customers’ or employees’ parking), but working out the details would be a fascinating challenge.

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On November 7, 2016, Peter Hill commented on Boeing: Dreaming Big to Fight Climate Change :

Thanks for the history lesson, Carl! It would be interesting to see how the financials of this investment ultimately shake out after another decade. While the investment brought them into a new age for sustainability, forced the hand of their competitors, and taught regulators a new set of expectations on fuel efficiency, I do wonder if it’s possible to make the math work on the investment having actually paid off in direct monetary terms. If so, that would be a great argument for the power of advanced R&D, even in the face of significant challenges and seeming failure.

PH

A wonderful economics lesson, Graham! Since you covered quite well how the firm can handle the effects of the carbon tax on its business, I’m left wondering what that ability to push the cost down the supply chain means for the effectiveness of the tax as public policy. The intention of a carbon tax, as you describe, is to raise prices on carbon usage such that a new equilibrium between supply and demand is reached, at a point that requires less carbon input. If Coles is working to ensure that the consumer (and the grocer itself) do not see the increase in prices that result from the tax, would the tax still have its intended effect of lowering carbon usage? Coles’ plan to shield customers from the supply costs would mean that demand would remain unchanged, but the cost has to be borne somewhere in the chain. The suppliers could theoretically take a lower margin and continue to consume carbon at the same level, which means that the cost of the externality is brought into the system, but it doesn’t directly result in lowering emissions. The question is whether on a macroeconomic scale it would be felt in terms of emissions. I’d argue that it would—ultimately, the lower profit the supplier would make would result in them consuming less elsewhere, which can be assumed to mean lower emissions based on underproduction elsewhere. Do you know if anyone looked into that in the case of Coles, the Australian law, or carbon taxes more broadly?

PH
On November 7, 2016, Peter Hill commented on An Inconvenient Trout: Nissui’s Approach to Climate Change :

I’m particularly struck by the need for both data analytics and innovation to deal with the effects of climate change—and the change that Nissui itself produces. The delicate balance that fisheries have already had to strike with amount they catch was difficult enough, without adding on the complexities of shrinking and moving habitats!

The shift to aquaculture itself seems to have been a big technological change, and it’s exciting to hear of other innovations to continue to lower the impact of that sector. From research that a colleague of mine did on “vertical farming” in New York City, I was surprised to learn that fish play a key role in some aquaponics, where a fish tank is connected to a soil free column for growing vegetables, using the fish waste as fertilizer. I wonder the extent to which this kind of closed system can be replicated at scale in the fishery industry, creating a circular economy that reduces environmental impact while producing both plants and protein.

PH
On November 7, 2016, Peter Hill commented on Is it all a Hoax? The GOP and Climate Change :

Definitely a timely topic, Clemens!

I’ve always assumed that Republican politicians’ statements about climate change were disingenuous—that though they understood that climate change is real and man-made, their public statements to the contrary were to satisfy other interests such as garnering votes or raising money as you suggest. Unfortunately, that does not appear to be the case. A Gallup poll from last year found that with more education, Republicans were actually more likely to believe that media reports of climate change are exaggerated (74% of Republican college grads), while Democrats’ opinions were more in line with the scientific consensus the more education they had (only 15% of college-educated Democrats thought news about the seriousness of global warming was exaggerated) (Frank Newport and Andrew Dugan, “College-Educated Republicans Most Skeptical of Global Warming,” [http://www.gallup.com/poll/182159/college-educated-republicans-skeptical-global-warming.aspx] accessed November 2016). It’s a disturbing finding, and unfortunately makes your hope that Republicans will take a clear and decisive position to acknowledge climate change unlikely.

To Kristen’s question, the League of Conservation Voters scores each member of Congress on their environmental voting record. I can’t speak to the methodology, but there is some overlap between the parties: Democrats in the House range from 31% to 100% lifetime scores, while Republicans range from 0% to 63%. That being said, they’re about as polarized as Clemens suggests: in the House, 129 Democrats have scores of 90% or above, while 215 Republicans have scores of 10% or below. (League of Conservation Voters National Environmental Scorecard, [http://scorecard.lcv.org/members-of-congress] accessed November 2016)

The GOP did an admirable job of assessing its weaknesses after the 2012 presidential election defeat—in particular noting the need to gain more support among latino voters. Though that plan was (spectacularly) not successful this cycle, the idea may still hold sway for the party in the future. In order for a party to be held responsible for its views on climate change, though, we’d at least need to start with it being mentioned in the primetime debates. As you note, Clemens, there’s still a long way to go.

Peter

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SH –

I’m so glad you brought back the image from the New York Magazine cover post-Sandy! What a spectacular series of photographs. I saw a few more of Iwan Baan’s photographs at an exhibition about designing for resiliency at the Annenberg Space for Photography in LA last year (https://www.annenbergphotospace.org/exhibits/sink-or-swim), and was impressed by the ways he highlighted the impacts and response to climate change, particularly in a photograph of a floating school in Lagos (http://iwan.com/projects/makoko-floating-school-lagos-nigeria/).

When New York City set out to create a resiliency plan after Sandy, insurance was one of the main areas of focus. The storm highlighted many vulnerabilities for the city, but what was particularly alarming was that outdated floodmaps meant that more than half of the buildings that flooded during the storm were not within the 100-year floodplain (“PlaNYC: A Stronger, More Resilient New York,” City of New York, 2013, p. 15, [http://s-media.nyc.gov/agencies/sirr/SIRR_singles_Lo_res.pdf], accessed November 2016). I wonder what role a company like Allstate could play in advocating for and supporting work to ensure better mapping of flood risks. FEMA has a set schedule to review and update flood maps, but Sandy demonstrated that more could be done—and that companies like Allstate may have been missing out on potential customers as a result.

Your suggestion of using the rate structure to encourage compliance (or surpassing) updated building code standards sounds like a great role for an insurer. Though it may be difficult for Allstate to incentivize a move (other than no longer offering insurance in that area), I like that line of thinking.

Peter