Under a provision in Governor Deval Patrick’s fiscal 2014 plan for the state, a "modern products" Massachusetts sales tax of 4.5% will be levied on the design and engineering services that create the digital world. Massachusetts is filled with software development companies — with verticals from mobile to healthcare to enterprise. It's a key innovation sector that drives the growth of our state economy and keeps our employment — which has consistently been better than that of the nation as a whole — at a healthy rate.
So, what will the consequences of this new tax be? For every $1 million in revenue, under the Governor's proposal, a software shop will pay an additional $45,000 — on top of the payroll, property, real estate, business and any other taxes it already pays. Consider this: For every $2 million in revenue, that's $90,000 in taxes, which could cover the salary of an entry-level software engineer including benefits. The 2011 Index of the Massachusetts Innovation Economy, indicates that software and computer services accounted for $31 billion of Massachusetts economic output. If, for the sake of argument, we consider just half of the economic output as taxable software design and development services, that would result in about $695 million in tax revenue, or roughly the equivalent of 7,750 entry-level software engineering jobs. Will this new proposed tax eliminate the creation of 7,750 high-quality jobs in Massachusetts? I'm not eager to find out. Now, to be fair, the Governor's budget estimates show a figure of just a quarter billion dollars in revenue to be realized from this tax, but the true consequences, like the law itself, remain unclear. The law is vague enough that the sales tax could cover all kinds of software, from mobile apps to even Web sites.
Remember when Spam was just meat in a can? I'm not quite sure when "spam" became a daily and often painful reality of my life - sometime after 1994 but before 2000 - but if it wasn't for spam filters I suspect email as an online tool would already be obsolete. If you create something good, that people pay attention to, and can make money, it is inevitable that the parasites, crooks and "capitalists" will soon follow to piss in the once-pristine pool.
COLUMBUS, OH (U.S.)—July 26th, 2012—Involution Studios, a software design consultancy based in Boston, MA, announced the opening of a second studio location in Columbus, OH.
"We are so excited about the new Columbus studio," said Dirk Knemeyer, a founder and current chairman of Involution Studios. "From our first project in Palo Alto, California to our studio in Silicon Valley, then Boston, and most recently here in Columbus, we are realizing the vision of bringing absolutely world class software design to as many people as possible."
Energy is the industry that IT forgot — or at least until recently. While sectors as varied as finance and healthcare, entertainment and communications have roared ahead with digitization, automation, and analytics, the energy industry has not evolved as rapidly. Despite this fact, it's clear that the future of energy lies in software. In both conservation and sustainability, software offers great possibilities for innovation — enabling companies to understand consumption trends, make better decisions about energy usage, and improve efficiency and performance over time.
Last week, at the Massachusetts Technology Leadership Council seminar "New Tools for the Energy Challenge", panelists discussed the opportunities and challenges facing the fledgling energy software space. The panel, moderated by Gabe Cole, SVP Transformation Services at technology consulting firm Telwares, included: Badri Raghaven, CTO of FirstFuel; Ganesan Ravishanker, CIO of Wellesley College; Lillian Smith, Principal User Experience Designer at Autodesk; and Kevin Johnson, CEO of Outsmart Power Systems.
Last year, Internet luminary and entrepreneur Marc Andreessen wrote a significant essay in the Wall Street Journal, outlining the many ways in which software has become absolutely vital to our world. Software allows us to extend our reach even further than we did before, automating processes, accelerating the rate of change, and providing the sinews between people and data. It seems only natural then, that software has come to the forefront of business technology.
At the Microsoft New England Research and Development Center last Wednesday evening, software innovators came together for a series of presentations and conversation about the opportunity for technology and design to effect positive change in healthcare.
One of my all time favorite books on innovation and the ecosystems that support it is Richard Florida's "The Rise of the Creative Class". Using census and economic data, Florida examines the factors that make Creative Class jobs — in science, engineering, technology, architecture, and the arts — primary drivers for economic growth. He also identifies a number of Creative Class cities that have the right kind of assets — like a strong university system, technological infrastructure, and a tolerant culture — to attract talent and support this kind of economic activity. Boston, of course rates high in Florida's evaluation. And even though Florida published this book in 2002, I think the analysis holds true today: There's no question that Boston is a top-notch Creative Class city. What's most interesting, however, is how Boston, over the past few years, has gained recognition as a world class city for innovation.
A recent study published by The Economist ranked Boston as the 10th most competitive city in the world, out of 120 major cities examined. For the study, the Economist defined competitiveness as "the demonstrated ability to attract capital, businesses, talent and visitors." And last year, Boston ranked number one on the Innovation Cities Index.
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