Daraius

Daraius

Later this month, a fifth casino will open its doors in Maryland, and in about two years, a sixth casino will open its doors. My question is this: Is there a sufficient consumer base to support this growth, or are the new casinos cannibalizing revenues in Maryland and the surrounding states in the region (New York, New Jersey, Pennsylvania, Delaware, West Virginia, District of Columbia, and Virginia)?

 

About thirty years ago, two states—New Jersey and Nevada—had casinos. For New Jersey, Atlantic City was the gambling destination for the East Coast; Las Vegas was the gambling destination for everywhere else. Additionally, Indian casinos came into prominence in the 1980s due to a Supreme Court ruling. However, in the last decade, the nation and the Maryland region have experienced an explosion of casinos and other gambling venues. The adult population or, more specifically, those who identify as wanting to gamble is not keeping up with the growth in the number of casinos opening in the region. Between 2000 and 2012, the adult population in the region (New York, New Jersey, Pennsylvania, Delaware, West Virginia, District of Columbia, Virginia, and Maryland) grew by 9 percent. However, the number of casinos grew by 183 percent during that same period.

 

Declining Gambling Revenues
As a result of this explosive growth, the media are full of reports on the share of gambling revenues declining across the region. This decline has resulted in several casino closures in Atlantic City. The gambling revenue is down in Delaware as well. In fact, there is a proposal to provide a subsidy to the casinos there. Gambling revenue is also down in West Virginia and Pennsylvania. Hollywood Casino Perryville saw a drop in its revenues once Maryland Live! Casino opened in Arundel Mills. I suspect that, when the Horseshoe Baltimore casino opens at the end of this month, Maryland Live! Casino will see a similar drop in revenue. Furthermore, when the MGM National Harbor casino opens in two years, another drop in Maryland Live! Casino’s revenue is likely to occur.

 

Image credit: South Bmore

Image credit: South Bmore

What is the underlying trend fueling this growth in casinos?
First, many states introduced lotteries as a means to raise additional revenues earmarked for specific programs such as education. Many states saw the success of other state’s gambling ventures and began to introduce gambling in their own jurisdictions, partly to keep their residents’ gambling spending in the state and partly to attract out-of-state gambling expenditures. The tax rate on gambling revenues is usually very high, but casinos are willing to pay due to the profitability of gambling ventures. For Maryland, it is a means for generating additional revenue as well as an economic development opportunity.

 

The economic development aspect of introducing casinos is somewhat tricky, and timing is everything. Being the first state outside New Jersey to allow gambling allows that state to generate enormous tax revenues and economic opportunity, as many out-of-state visitors are attracted to the new casinos. However, being the last state to allow gambling means that the number of new gamblers visiting from out of state is very limited.

 

Furthermore, the shifting in-state spending from local restaurants to local casinos does little in the way of increasing local economic activity. However, if local casinos can capture out-of state spending, then there will be an increase in local economic activity. In the Mid-Atlantic region—New York, New Jersey, Pennsylvania, Delaware, West Virginia, District of Columbia, Virginia, and Maryland—all but two, Virginia and District of Columbia, have legalized gambling. For Maryland and West Virginia, this disparity has proven to be a great geographic advantage, as Virginians and Washingtonians who wish to gamble can go to either West Virginia or Maryland to spend their money. However, within Maryland, the share of clients to each casino will likely drop as the number of casinos increases.


Ellen

Ellen

The usually quiet Monday after the long Fourth of July weekend—a day for downtown Baltimore to recuperate from the crowds, festivities, and celebratory revelry of democracy. Unless, of course, Queen Bey is taking over M&T Bank Stadium.

 

As part of the combined “On the Run” tour featuring Beyoncé and Jay-Z, the power couple performed at the M&T Bank Stadium to a sold-out crowd of excited fans. The downtown venue was just one of sixteen stops for this summer’s tour, which attracted concert-goers from near and far.
 

ontherun

Image credit: CBS Baltimore

 

Here at RESI, we analyze the economic impacts of various programs and events, and last month’s Beyoncé/Jay-Z concert had a definite impact on Baltimore’s economy. With ticket prices ranging from $40.50 to $251 for general admission seats and premium seats going for roughly $500 per ticket, ticket sales alone for the sold-out stadium of 70,000 represented a huge economic impact. Combine these data with concert-goers grabbing dinner downtown before the concert, paying for parking, and buying souvenirs—that’s a lot of money changing hands in just one evening. And keep thinking about it—someone had to sell those Beyoncé t-shirts and oversized programs. The electricity bill for the stadium included the power needed to show the Beyoncé/Jay-Z video interludes, and this required electricians and tech people at the stadium to ensure that everything transitioned smoothly. Outside the concert, servers who received extra tips from the increased crowds have extra cash to spend. If anyone drove on a toll road to get to the concert or travelled from far away and spent the night at a local hotel, there’s more money circulating in the local economy.

 

In fact, the economic impact of large headline concerts such as “On the Run” has been the topic of numerous academic studies. In their 1997 paper, Gazel and Schwer estimate the economic impact of a 1995 Grateful Dead concert on Las Vegas. While not a perfect point of comparison to Baltimore’s Beyoncé/Jay Z concert, the framework outlined in this paper as applied to the July show suggests that, at a conservative estimate, the estimated economic impact was over $11 million, with more generous estimates of the economic impact from the single concert being closer to $18 million.
 

beyonce2

Image credit: Baltimore Sun

 

Another way to analyze the concert’s impact is to bring the analysis closer to home. Let’s consider the M&T Bank Stadium’s main occupant, the Baltimore Ravens. Ticket prices are comparable, and much like the Beyoncé/Jay Z concert, Ravens games draw huge crowds of dedicated fans to the stadium, attract visitors to Baltimore’s downtown area, and are featured in both local and wider media. I would argue that the concert, a one-night engagement, as opposed to the Ravens’ full-length season of home games, is more comparable to a playoff game held at the stadium. Luckily, for our purposes, estimates of the economic impact of Ravens playoff games already exist. Estimates from 2013 indicate that a single Ravens playoff game would have a total estimated impact of $20 million. That’s quite a lot of money, especially for a two-hour football game or show.

 

Clearly, the Beyoncé/Jay Z show had more of an impact than entertaining its 70,000 attendants. Given the far-reaching economic effects for Baltimore, it is safe to say that, in the words of the Queen herself, “Who runs the world [or at least local economies during her tours]?” Beyoncé.


Michael

Michael

Esri holds many national and local user conferences throughout the year. Their leading conference happens right about this time each year in San Diego California, with this year’s 34th User Conference landing on July 14-18. Formally known as the International User’s Conference (now just User Conference or UC), it is the premier world GIS event, with participants from 130 countries among the 16 thousand people in attendance. To put that in perspective, by most accounts there are 196 countries in the world. This year the Esri UC drew participants from about two thirds of countries in the world. With the first day dedicated to the plenary session and keynote address, the next four days are packed with 1,397 moderated paper sessions, industry focused sessions and technical workshops organized into 71 different topic areas. All in all it is a bit overwhelming with so much relevant information to choose from and try to adsorb in such a short period of time.

 

MB1In order to energize you for the week of information overload, the first day is all about the big picture, success stories and what coming in future releases of ArcGIS software. This is all done wrapped in a wall of screens with beautifully orchestrated music and graphics to produce a completely immersive experience.

 

Esri Founder and President Jack Dangermond opened the conference with the theme “GIS – Creating the Future”. He shared his perspective that the practice of GIS is at an evolutionary threshold. He sees GIS maturing beyond spatial analysis and moving into full-fledged geo-design, encouraging us to see ourselves as geo-designers to provide the world with fully rounded solutions and alternatives to the many problems we face. He also indicted that he feels that something is a-foot and left us to see if we agree with the rest of the day’s program.

 

As is Jack’s UC tradition, he shared the best of our work, with submissions from around the world organized by category and displayed, with trends discussed. MD iMap was recognized for the new GIS Data Portal in this part of the plenary and later in the day more fully in a dedicated section on Open Data and the World Bank. CGIS worked as part of the GIS Data Portal implementation team and among other items created the data graphics making the site more attractive and easy to navigate.

mb2

First Day Highlights

There was too much on this first day to provide any level of detail on all the incredible presentations in this blog post, instead here are the highlights and links back to the video taken of the presentations in case any of them catch your imagination.

  • The City of Minneapolis and their use of GIS to recover from the devastating blow of the economic down turn of the past few years.  Their team dropped from 8 to 3 GIS professionals. Their success came from completely reinventing their workflow, empowering their cliental to be self-sufficient in working with GIS data and embracing cloud based GIS solutions.
  • The port of Rotterdam’s use of GIS to transform from being the world’s largest port to being the best port in the world. With a ship coming or going every 6 minutes and a 4 hour sail time from the entrance point of the port to the farthest berth, optimizing and managing real time data in their GIS was key to their success in reengineering  port operations.
  • Starbucks IT’s use of GIS to support operations and new store location analysis. Looking to expand in areas with emerging smartphone use (demographics highly correlated to visits to Starbucks) and looking for optimal locations for their Starbucks Evening store rollout (wine, beer, desserts, a spread of cocktail party finger-foods, and more).
  • Singapore’s Urban Redevelopment Authority demonstrated its use of 3D GIS as a crucial planning tool for one of the most densely populated cities in the world. Impact analysis, alternative plans and meeting design metrics in an expedited manner were all successful outcomes of applying geo-design concepts and practices.
  • U.S. Commerce Secretary Penny Spritzer shared her views on the value of open data in a keynote speech titled America’s Data Agency – Expanding Economic Opportunity with Open Data.
  • Dr. Kathryn D. Sullivan, NOAA Administrator, Under Secretary of Commerce for Oceans and Atmosphere, US Department of Commerce (and former shuttle astronaut) shared how she is striving to bring earth science to life for global and national environmental challenges and decisions we all face.
  • Will.i.am (via Skype from Australia) talking to Jack Dangermond after an Esri staffer showed off a prototype of the smart watch he is developing, which includes an a really innovative voice activated Esri mapping application that is a peek into the future (or the past, as I think Dick Tracy had this watch)! Will.i.am explained that this project is part of his efforts in a larger program to empower youth in disadvantaged areas similar to where he grew up.
  • Jane Goodall (video message) provided a follow up to her 2005 Esri UC Keynote address on the threats that chimpanzees face. She talked about how GIS-supported land use management plans for villages around critical habitat areas are making a real difference in conservation efforts to save space for chimpanzees.
  • Sonora Elementary students from Springdale, Arkansas will surely impress you with the way that GIS can be connected with education. Their teacher Charlie Fitzpatrick introduces two of his students and they steal the show talking about their projects.
  • World Health Organization and the Bill and Malinda Gates Foundation representatives (Dr. Bruce Aylward and Dr. Vincent Seaman) delivered a joint keynote presentation on the Global Polio Eradication Initiative. This in-depth presentation stepped though the intensive efforts to reach the last pockets of polio in the most difficult locations to reach on earth, and how GIS is vital tool to for fill this mission.

 

What was evident from the prominence and diversity of these presentations was there is indeed something “a-foot”. From my perspective it was that Esri did not so much promote what their products could do, instead they let the stories of their products speak for themselves. These were indeed very powerful stories that spoke to the transformative power of GIS in action. There was another thread woven throughout the week’s paper and industry focused sessions that reinforced this notion of real change in the air both with the science and practice of GIS.  It was apparent that the transformative steps Esri has taken with its platform over the past several years and its efforts to make GIS more accessible are all coming together in a unified fashion across all fronts within the organization. Esri seems to be laser focused on its client’s success in a way that I have not seen before, providing complete solution sets for complex problems and implementations.

 

Special Achievements in GIS

In the middle of the conference each year Esri recognizes exceptional work in GIS by presenting “Special Achievements in GIS” or SAG Awards. This year the State of Maryland was recognized for OSPREY–Innovative use of GIS for Emergency Management that makes a difference. Barney Krucoff accepted the award on behalf of the Maryland Department of Information Technology (DoIT) and the Maryland Emergency Management Agency (MEMA). CGIS is a proud partner in developing the OSPREY suite of tools in support of emergency management and the citizens of Maryland.

Michael Bentivegna (CGIS), Barney Krucoff (DoIT), Mickey Brierley (FEMA – formerly MEMA)

Michael Bentivegna (CGIS), Barney Krucoff (DoIT), Mickey Brierley (FEMA – formerly MEMA)


Jeff

Jeff

For those of you who follow federal policy – no doubt you are a regular consumer of 2 AM CSPAN and throw a watch party for the Vice Presidential Debates – the passage of new federal policy objectives is like our Olympics. They happen every couple of years, someone wins and someone loses, and as soon as it is done, we typically forget the names of the players. Sounds familiar right? Well, unlike other policies coming out of Washington creating strong partisan wrestling, such as the Affordable Care Act, the recently passed Workforce Innovation and Opportunity Act (WIOA) presented a rare opportunity for our legislators to meet in the middle and shake hands to create policy about a decade overdue.

 

President Barack Obama signs H.R. 803, the Workforce Innovation and Opportunity Act  (Image credit: whitehouse.gov)

President Barack Obama signs H.R. 803, the Workforce Innovation and Opportunity Act (Image credit: whitehouse.gov)

The Workforce Investment Act (WIA)
In 1998, the Workforce Investment Act (WIA) – the mother of WIAO (please keep up with the acronyms) passed Congress – a measure to promote workforce training and adult education throughout the county. The Act authorized funds from federal coffers to support localized education and training initiatives to support local workforce. Most notably, it called for the creation of state and local Workforce Investment Boards to create and maintain One Stop Career Centers to support individuals seeking employment or access to training and education services. WIA has been a stable and arguably successful model for 16 years, though a lot happens in 16 years (three presidents, nine Olympic Games, and still no Super Bowl for my Philadelphia Eagles).

 

Workforce Innovation and Opportunity Act (WIOA) Workforce Innovation and Opportunity Act (WIOA)
So, what’s important about this new policy, other than evolving policy to modern needs and creating a rare opportunity for bi-partisanship in our capitol? A couple of major elements of WIOA are of note. WIOA

  1. Aligns federal investments to support job seekers and employers – core programs at the local level are better aligned to support job seekers
  2. Strengthens state, regional, and local workforce investment priorities – prioritizes employers on local boards to drive and develop workforce strategies
  3. Emphasizes employer engagement – gives more flexibility at the local level to make investments and support on-the-job training initiatives
  4. Increases accountability – we have the technology to monitor and evaluate the effectiveness of programs
  5. Fosters regional collaboration – encourages greater regional accountability to target industry needs
  6. Increased emphasis on career pathways and sector partnerships – better opportunity to serve job seekers in establishing a career, rather than filling an open job
  7. Improves services to people with disabilities

The nuances of the seven references above are more pertinent to individuals mired in workforce service and policy, but if you want to learn more about it check in at this website – http://www.doleta.gov/WIOA/

 

For those who only have a passing interest, it means that American Job Centers (AJC), formerly known as One Stop Career Centers or Unemployment Offices, have better tools and greater flexibility to serve our workforce and meet the needs of employers. The emphasis on accountability and employer needs will create a stronger symbiosis within the system. There will be new competitive opportunities for funding necessitating broader partnerships between workforce, economic development, employers, and higher education. I have been in workforce for a number of years and have heard arguments about these types of collaborative relationships. It usually results in employers complaining that educators fail to meet their needs and educators complaining that employers fail to articulate their needs – the Kobayashi Maru scenario. From there we all settle on the fact that the only viable option is to address “soft skill training,” which is the Stanley Cup of workforce priorities.

 

Well, the hope is, with new energy behind WIOA, and greater calls for collaboration and systems of accountability to provide greater feedback, perhaps these arguments will be contained and we can focus on the needs of our system. All in all, we should be happy that our elected officials came together to support and pass critical legislation that has the potential to succeed.


Jeremy

Jeremy

Towson University’s Center for GIS (CGIS) recently assisted the Maryland Humanities Council (MHC) in their promotional needs by developing a web mapping application that helps MHC audiences and donors quickly identify MHC events that occur near them.

 

Phil Reese, a GIS Programmer for CGIS, was the primary programmer that developed the MHC web mapping application.  Recently I caught up with Phil to discuss his involvement with the project along with the reasons behind utilizing Mapbox (an open source mapping platform) to complete the project.

 

Screenshot of the MD Humanities Council Map (Click photo to view the mapping application)

Screenshot of the MD Humanities Council Map

Q:  What options, other than Mapbox, were considered for the development of the web mapping application?

A:  We briefly discussed using the ArcGIS JavaScript API, but decided against going that route because we weren’t planning on creating or using any ArcGIS Server map services for this project.  We also discussed using Leaflet, which is a very popular light-weight JavaScript mapping library that is well documented with a very active community of developers.

 

Q:  Why did CGIS ultimately decide on using Mapbox for this project?

A:  Mapbox.js was ultimately chosen because of the extensive documentation and examples that exists.  We actually found several examples on the Mapbox.js developer site that almost exactly fit our needs, so we were able to closely follow these examples to jumpstart development of the application.  Another reason we chose Mapbox.js is because it is a plugin for the Leaflet JavaScript mapping library, which means that all of the advantages of Leaflet that I mentioned earlier – great documentation, lots of great plugins, flexible, and efficient – are also advantages for Mapbox.js.  Additionally, Mapbox provides us the ability to use excellent basemaps (and even the ability to customize them to fit our needs) included in a free account that accommodated our expected number of monthly views.

 

Q: Did you face the need to do a lot of customization, or did you work mostly with the “out of the box” tools that were available?

A:  Most of what we needed to do was “out of the box” in the sense that there were examples of specific pieces of functionality that we desired and thorough implementation descriptions.  We had to use these technologies in ways that suited our needs, so a certain level of development above and beyond what was illustrated in the examples was required, but the documentation and community resources were very valuable for inspiration and direction.

 

Q:  Were there other technologies you used in conjunction with Mapbox in order to complete the project?

A: We used some very popular (and free) frameworks and libraries that are commonly used across the Internet.  We used Bootstrap for the pre-style user interface components (e.g. think buttons, forms, dropdown menus, etc.) that it provides.  We also used jQuery, which is a JavaScript library that simplifies common JavaScript tasks.

 

Q: What was the biggest challenge you faced?

A:  Custom functionality that went above and beyond what was illustrated by the examples on the Mapbox.js developer site was sometimes challenging.  We didn’t have a lot of wiggle room to get stuck on certain parts of the application that needed a more custom solution, so it was sometimes a struggle to deliver the promised functionality on-time and under budget.

 

Q:  What was the biggest surprise you experienced?

A:  The wealth of developer resources available online for Mapbox.js and Leaflet developers.  While we knew this would be an advantage of using these technologies, I think it was a surprise to see how widely used the libraries are.

 

To view the MHC mapping application, click here.

 

To view a project sheet on the MHC mapping project, click here.


Laura

Laura

Why Develop Leaders?

The need to develop the next generation of leaders is critical. The JIBS model of leadership, developed by Dr. Alan Clardy, provided a unique way that really helped me to conceptualize the importance of leadership development:

The JIBS model is (c) by Dr. Alan Clardy.  Used by permission.

The JIBS model is (c) by Dr. Alan Clardy. Used by permission.

The model puts leaders into four categories: idiots, bozos, jerks, and stars. If an organization does nothing to develop their leaders, odds are, only about 25% will be stars. Whereas, an organization that invests in developing their workforce, will have a substantial increase in the number of stars. While this is a bit light hearted, it really drives home the fact that we cannot just leave our workforce to “figure it out” on their own.  We must provide them with the opportunity to become a “star.”

 

2014 Maryland Leadership Academy for Workforce

Here at the Center for Professional Studies, we have worked with many clients to develop leadership programs that meet the needs of their unique workforce. Recently, we have partnered with the National Association of Workforce Development Professionals, to establish the 2014 Maryland Leadership Academy for Workforce.

 

The year-long program will focus on preparing participants to more effectively lead their teams, agencies, and Maryland’s workface industry in the future. Participants will identify their strengths and learn how to engage those strengths in critical leadership areas. Additionally, participants will be trained on Maryland specific issues, complete a capstone project, and be matched with a mentor.

 

For more information on the 2014 Maryland Leadership Academy for Workforce, please visit this informational page.


Jenn

Jenn

It’s that time of year again! The Division of Innovation & Applied Research just purchased promotional products to be used at upcoming trade shows and events – and it was no easy task. If you’ve ever purchased promotional items, I’m sure you know there are a lot of factors (and opinions) to consider in the process. Promotional items can be, when correctly selected, a valuable marketing tool for expanding your brand and message.

 

Here are a few things to consider when choosing promotional items:

 

Image credit: ID.me

Image credit: ID.me

The Location Where You’ll Be Distributing the Items
This could be a key factor in determining the right product. For example, if you will be handing the item to clients at a golf charity or networking event, consider a golf towel, golf tee, or golf pencil. Another example would be if you are distributing the product at a conference near the beach, you could choose a beach towel or sunscreen. It’s always nice for attendees to receive a product that they can use in the location where they’re receiving the product.

 

Your Products and/or Services
You should also consider an item that somehow ties in with your products and/or services. For example, if you provide IT services you can opt for a technology-based giveaway like a flash drive or computer screen cleaner. By choosing an item that relates to your products or services, you can remain at the top of your customer’s mind when they think of your product/service area.

 

Your Audience
You should always consider your audience when selecting promotional products. For example, if your audience is a strongly composed of educators, you could choose an item that they can use in their classrooms.

 

Promotional items can be very beneficial because they get your brand and message into the hands of potential customers. However, if you put a lot of thought into selecting the right promotional materials, your brand/message will be more likely to resonate with those you truly want to reach.


Dawn

Dawn

If you have been following along with some of my blogs, you will notice a recurring topic: REQUIREMENTS (Are Requirements Necessary When Purchasing IT Products , What Does Your System Require?).  I know I have written this before, but having good requirements is the foundation of any successful system. If you write really good requirements at the beginning of a project, you will have useful Test Plan by the end of it.

 

Requirements Development and Testing
In the System Development Life Cycle (SDLC), there are two areas that tend to be short changed, in both the time needed and details required:  requirements development and testing. These are the same two areas that cause the greatest issues if there is no commitment. If well written and easily understandable requirements are created at the beginning of the project, then the developers can build a system that meets those requirements and then those same requirements can become a clear and concise Test Plan. This will result in a Test Plan that thoroughly evaluates the requirements, thereby providing the client with a fully tested system that meets their needs.

 

Systems Development Life Cycle - Image Credit - Netlocity

Systems Development Life Cycle – Image Credit – Netlocity

Elements of a Test Plan
A Test Plan, in its simplest form, is a chart. Applied Research and Technical Services (ARTS) uses an Excel spreadsheet that includes the requirements, arranged in numerical order, and incorporates columns that let the Tester denote whether or not the system performed correctly.  For example, the requirement may be, “The System shall include a log in screen that contains both ’Username’ and ’Password’ fields.” If during testing, you go to log into the System and either the “Username” or “Password” field is missing, the requirement was not met and the failure will be indicated on the Test Plan.

 

Testing is an important part of any system development process; however, even with the best Test Plan and the most conscientious Testers, there is almost always some bug that no one anticipated.  That’s ok! Between the unit testing (testing done by the developers during development), using the Test Plan that is based on the requirements,  and the testing being completed by the client (User Acceptance Testing – UAT), most major issues should be discovered and corrected prior to the system “going live.”


susan steward

Susan

Loyalty programs have been around for ages. The idea behind them is to gain information about consumers, then tailor a store’s offers to them to increase their spending in store and to ward off competition. Often, these programs were done on a store-by-store basis and offers were targeted for their stores alone. However, in the last few years the economy has witnessed the emergence of cross-store loyalty programs. For example, gas rewards and grocery stores.

 

Currently there are several versions of this program.  For example, the grocery chain Giant has partnered with Shell and, similarly, Safeway has partnered with Exxon/Mobil. Under these programs, a consumer purchasing their weekly groceries at Giant or Safeway can swipe their “Bonus” or “Rewards” card and redeem savings on their groceries. Then, the additional cross-store rewards begin. The store states that for every dollar a consumer spends, they will receive a specific number of gas rewards points. Using their newly accrued rewards points, grocery consumers can proceed to the pump and enter their card number, redeeming these points to reduce their per gallon price for gas.

 

As Morgan and Hunt (1994) state in their research, these programs operate under the assumption that both the consumer and the retailer are committed to specific brands. However, as Liu (2007) points out, the consumer preference for grocery stores and gasoline brands may be relatively low and therefore the tradeoff between brands is relatively easy for consumers. In a review of consumer loyalty programs, Liu (2007) does find that over a period of time consumers will often continue to shop at the same retailers and increase spending levels under loyalty programs. According to Kim, Shi, and Srinivasan (2001), the increased demand through loyalty programs has an advantage for stores as well because this will inadvertently increase their tradeoff between firms for the same goods.

 

Savings at the Pump and Increased Disposable Income

At RESI, one of our favorite things to do is to consider general, everyday issues in relation to Maryland’s economy. Often, this results in us doing a bit of background work and then determining inputs for our REMI model. Thinking about gas rewards programs and their impact on Maryland’s economy, some questions arise.  Taking into account the gas rewards savings on an annual basis across households, what would this translate into for Maryland’s economy? What would this increased annual savings across households look like in REMI?

 

Disposable Income Changes

RESI always needs some primary data, and, given the short timeframe, the group needed a guinea pig. Thankfully, at least one employee shops at one of these grocery stores weekly and saves their receipts. This same employee visits the pump at least every two weeks, and happened to save their receipt this week.

 

Image credit: RESI

Image credit: RESI

 

The photo above shows the receipt on the bottom as the employee’s current rewards amount, and the receipt on top was their savings at the gas station that week from rewards over a two week timespan. It’s unlikely most people will save $0.60 per gallon every time they go to the gas station, but it is reasonable to suggest a $0.10 savings given the employee’s current gas rewards points.

 

RESI then took this $0.10 savings and multiplied it by 15, as the average fuel tank size in Maryland is 15 gallons. Therefore, if most people fill their tanks at the close to empty mark this translates to roughly $1.50 in savings on each trip. Over one month, this could equate to roughly $6.00 in savings.  Over a year, these savings would increase each consumer’s disposable income by $72.00. Although this isn’t much to a consumer, there are roughly 2,598,000 automobiles registered in Maryland as of 2009 according to the U.S. Federal Highway Administration. If at least 50 percent of those vehicles were to take part in this loyalty program and save $72.00 a year that would increase Maryland’s total household disposable income by $93,528,000 a year.

RESI ran this increased disposable income in REMI and found the following:

Jobs Output Wages
172.0 $19,567,000 $7,782,000

Source: REMI PI+, RESI

The reallocation of the disposable income from consumers supported 172 jobs, $19.6 million in output, and $7.8 million in wages in 2013. What does this do to prices? According to RESI’s analysis, although the price of consumer goods would increase, the change would be relatively small across the economy. Areas such as transportation services, motor vehicle fuels, and food and beverage purchases for off-site consumption (grocery) would see relatively small increases (less than half a percent).


Aaron

Aaron

Over the past few years an intense battle has been taking place over the way content is delivered to consumers, via the internet. This is the battle of Net Neutrality. So what is Net Neutrality? Net Neutrality is the idea that all traffic traversing the Internet is treated the same. No one source or type of content is given any special privilege to reach its consumer over any other content source or type. The notion is that the Internet is a free and open space, giving users (both developers and end consumers) equal access to any website or application. Seems logical right? So who is posing a threat to this simple, yet genius notion? Internet Services Providers (ISPs). Within the realm of Net Neutrality ISPs are not allowed to discriminate between the sources of Internet traffic you consume, but if things go their way this will soon change.

 

ISPs: Our Content Deciders
ISPs want to set up a “pay for play” system where content developers would pay ISPs a premium to get their content to end users first, or in a timely fashion. ISPs would in essence create a model where content developers and providers who can afford it, would reach the end user first; whereas content developers who can’t afford (or don’t want) to pay this premium would no longer be easily accessible to their audience. This would further marginalize “smaller” content developers by not allowing them to reach audiences simply because they can’t afford to, and not because of the quality of their content. In addition, this model will  change the way we pay for the Internet. Currently we pay our ISPs some flat rate that is typically only limited by bandwidth capacity. In the new proposed model, your Internet bill could begin to look a lot like a cable bill, where you pay for different “Internet tiers” of content. So you want to be able to access YouTube? That’ll cost an extra $10/month. How about NetFlix or Hulu? That’ll cost you an extra $20. Our ISPs should just be the delivery service of our Internet content, but this makes them the deciders of our content.

Image source: Wired.com

Image source: Wired.com

Role of the Government
Another question you may be asking is why would the government (FCC) strip away Net Neutrality? Well, in 2010 the FCC actually established “Open Internet Rules” which supported Net Neutrality. In essence these rules were: 1) ISPs need to be transparent about how they manage network congestion; 2) they can’t block traffic on wired networks, no matter what the source; and 3) they can’t put competing services into an “Internet ‘slow lane” to benefit their own offerings. So what happened? Verizon, one of the largest ISPs, challenged these FCC rules and in January 2014 a federal court ruled in favor of Verizon (and ISPs) primarily dismantling the last two rules. Furthermore, it doesn’t bode well that the former chairman of the FCC, Michael Powell is now the cable industry head lobbyist, and the current head of the FCC, Tom Wheeler, is a former cable industry lobbyist.

 

The Impact on Online Education
This now brings us to the big question, how exactly could this affect online education? If Net Neutrality is dismantled, and a “pay for play” system is introduced, then institutions offering online education will have to pay ISPs a premium for their courses to reach students. Imagine an Internet where the multimedia content of an online MBA program from the University of Phoenix is allowed to perform better than similar multimedia content from an online MBA program through the University of Baltimore. Or a scenario where the course videos recorded in our Digital Media Classrooms here at Towson University no longer stream well for our students, only because UMBC has paid ISPs a premium for educational content bandwidth on their networks. Furthermore, as many schools move more of their educational content into cloud based services, and ISPs in turn require these cloud storage companies to pony up more money for efficient content delivery, then the additional cost will ultimately be passed along to the customers, e.g., the students. Given the exorbitant and still rising cost of college tuition, I can’t imagine any student being pleased about having a new line item in their tuition bill that reads “Online educational content storage and delivery fee: $XXX”

 

Image source: Dear FCC

Image source: Dear FCC

The concept of Net Neutrality and its grave importance spans across all industries, and disassembling Net Neutrality will ultimately suffocate innovation. The FCC needs to hear from all of us regarding the importance of keeping the Internet a neutral space for the sake of online education, and all content developers. The Electronic Frontier Foundation has created a simple form for anyone to use to tell the FCC why the Internet needs to remain open: https://www.dearfcc.org/