RHetoric

Now that a year has passed since the stimulus act became law, it's worth considering it's impact.  Many of our clients are selling into the government, healthcare, and education markets - and the impact has been significant.

On the one hand, our clients that sell to government agencies and education saw sales hold steady during the recession.  However there is new fear that the stimulus has mostly been spent and things will fall off a cliff in the year to come as massive holes open up in municipal budgets.

In healthcare, our clients saw a huge stall in 2009 as the promise of stimulus caused IT buyers to pause and wait for rules to be issued over what is or isn't covered by stimulus money.  However there is new optimism that money is starting to flow and the impact will hit in 2010.

Our client Onvia tracks this data down to the penny and told Fox Business News today that just 25% of the stimulus project money actually left Washington in 2009, yet the majority of it will reach the private sector this year.  Onvia also says that nearly half of all GDP is government spending - this is an astounding figure that may indicate anyone who ignores the government market is shelving half of their business development opportunity.

We'd love to hear from you if the stimulus has impacted your business, for better or worse.

With Google’s Sonal Shah and FCC counsel-turned-VC Julius Genachowski advising the president-elect on the transition, and the launch of a transition web site Change.gov, a new tech agenda is emerging. Here are some themes we will be following:

Public Sector Tech

• The new administration has been very clear that it will appoint a first-ever CTO to focus on federal agencies’ use of technology. The names being bandied about in the press, such as Larry Ellison and Steve Ballmer, are all way too high level for the job. This will not be a high profile position except within the limited circles of federal government I.T. contracting. Key areas of responsibility will be cybersecurity, transparency, and modernization.
• Continued investment in public safety technologies is likely. No one in the new White House wants to repeat the Katrina disaster on their watch. The main themes will be first responder technology, emergency communications networks, and interoperability.
• Rural areas will be a special focus for continued broadband deployment. This will include reform of the Universal Service Fund program and spectrum auctions. The emphasis will be on ubiquitous access to improve healthcare, emergency services, and general Internet access parity with urban areas.
• Expect lots of grantmaking, federal matches, and low cost federal loans for infrastructure build-out.

Health Care Tech

• The headline here is a $50 billion investment in health I.T. over five years. This seems implausible given our government’s financial situation, although it is a safe bet that Congress will approve more funding in this area.
• Emerging health IT themes are patient safety, personalized medicine, quality measurement, access to care, and efficiencies (such as  in claims processing).  The technology focus is on widespread adoption of electronic health records, standards, and decision support technologies.
• Rural areas are also expected to be addressed, primarily through the expansion of telemedicine technologies.
• Veterans medical care will be front and center in the president-elect’s first budget request. This will include more funding for an already progressive deployment of health I.T.
• John Halamka has a good round-up of more specific predictions for first year on his blog, here.
• Expect lots of demonstration projects, grantmaking, and funding for major agency-driven programs.

Education Tech

• The key themes are better teachers, No Child Left Behind reform, and more emphasis on math & science in K-12.
• Technology is not specifically addressed in the current education narrative coming out of the transition team.

It’s still very early, and the incoming Administration is in a safe harbor period of being able to make promises that it knows the Congress won’t keep. Also remember that every president submits budgets to Congress that include spending initiatives that will never see the light of day in an appropriations bill, but they throw them in there anyway to make a policy statement.

The next step in the transition process is the float. This is where the transition team begins floating names of potential cabinet and agency appointments in the press, to guage reactions. The names emerging from this process will provide more clues about the new administration’s policy proposals.