The news itself is interesting but boring: Microsoft and Facebook are teaming up to lay a big cable across the Atlantic Ocean. This won’t change how most people interact with Facebook and Microsoft products, but it says a lot about the future of tech companies, namely that they’re going to operate a lot more like telecommunications companies. Wired sums up the trend nicely:
The project expands the increasingly enormous computer networks now being built by the giants of the Internet as they assume a role traditionally played by telecom companies. Google has invested in two undersea cables that stretch from the West Coast of the United States to Japan, another that connects the US and Brazil, and a network of cables that connect various parts of Asia. Rather than just leasing bandwidth on undersea cables and terrestrial connections operated by telecoms, the likes of Google, Facebook, and Microsoft are building their own networking infrastructure both on land and across the seas.
Microsoft’s and Facebook’s cable signifies a few industry trends. One, speed is important. As cloud computing becomes more prevalent, providers must ensure latency isn’t an issue. Self-run conduits are, at this point, the best way to go, and this Atlantic data python could shuttle 160 terabits of data per second.
The second trend is that companies are taking these infrastructural projects into their own hands, rather than lobbying nations to build them. Many tech firms are battling with telecom companies in the quest to connect developing areas to the Internet, which, in the United States, is recognized as a basic utility.
Data is the currency of this economic era. Expect more tech firms to take the transmission and storage of it into their own hands.
Millionaires don’t flee
I grew up in Wyoming, which some of you may know has the most business-friendly tax structure in the U.S. Corporate income tax? Nope. Personal income tax? Don’t have to worry about that garbage! Thus, the Equality State is Valhalla for corporations.
So why, with its free-market embrace, isn’t Wyoming the corporate scion of our great nation? Why, instead of a Silicon Valley-like technology hub or a New York-esque finance sector, is Wyoming’s lifeblood a bleeding carcass of a coal industry?
Let me tell you why: Because Wyoming is cold, windy, and sparsely populated. Believe it or not, business-owners and millionaires care about more than taxes, and a recent study backs that up.
Folks at Stanford University and the U.S. Treasury Department looked at 13 years of tax information, and their findings suggest the obvious: Liberal tax policies don’t force millionaires to flee for Wyoming. Despite what many conservative politicians and pro-business groups would have you believe, people care about other things — access to talent, education, and of course beaches — more than they care about a tax hike.
The study estimates that, when rich people move, the do so for tax purposes only 2.2 percent of the time. Furthermore, “If states increase their top tax rate by 10 percent, they risk losing just 1 percent of their population of millionaires, the researchers found.”
So if you’re sick of potholes and collapsing bridges and terrible transit, know that a tax hike probably won’t make Satya Nadella try to relocate Microsoft to Rawlins.
Elsewhere on the Web
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Amazon’s headquarters is more environmentally friendly than any fancy suburban campus simply because it’s in downtown Seattle.