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Illustration: Lazaro Gamio/Axios

When you are a second-tier city, courting a Big Tech company can backfire.

  • As we've reported, cities have struck big-ticket deals with tech companies, but typically surrender tax and other subsidies, only to have the incoming firms frequently fail to deliver.
  • And second-tier cities across the country have made themselves labs for the nascent driverless car industry. Those experiences have sometimes led to tragic outcomes, including a June 2018 fatal accident in Tempe, Arizona, where a woman was hit by an Uber driverless car.

For the Big Tech companies, the payoff is usually data. In its recent search for an HQ2, Amazon solicited applications from 238 cities, large and small. On the way to settling on New York and a Virginia suburb of Washington, DC, Amazon ended up with a massive, granular database of American cities, a goldmine of inside dope as it expands.

But almost always, the smaller metros end up disadvantaged.

One city that spilled its secrets to Amazon: With big hopes for the $100,000-a-year jobs the company dangled in front of the bidding cities, Spokane, Washington, submitted a bid for HQ2.

  • Spokane's proposition, Mayor David Condon tells me, included the very practical advantage that it's affordable.
  • In the end, Spokane, a near sister city of Seattle five hours away from the main Amazon HQ, won a booby prize — an Amazon warehouse that will employ around 1,500 people at about $15 an hour.
  • And when it got the warehouse, the city built new infrastructure, Condon says — roads to accommodate increased truck traffic to and from the building.

Albuquerque is arguably better placed as a destination for Big Tech, with a population around 600,000 and four universities. Indeed, it has already attracted a handful of major satellite campuses, including a 3,300-strong Intel office.

But even Albuquerque gets played by Big Tech:

  • Instead of a Facebook office, it has a Facebook data center, which has created thousands of short-term construction gigs, but will ultimately employ just 300 people long-term.
  • And to get Facebook even to go that far required $30 billion in industrial revenue bonds on the company’s behalf, which will result in tax breaks over the next 30 years, per the Albuquerque Business Journal.
  • Meanwhile, there are side effects: Facebook has taken such a huge share of the city's construction workforce that airport renovations are delayed.
  • Netflix made waves in Albuquerque when it decided to put its North American studio headquarters in the city. It promised to spend at least $1 billion producing TV and movies in Albuquerque over the next decade. But Netflix paid just $30 million for the existing facility it will occupy, a complex that cost the city $91 million to build.

Albuquerque Mayor Tim Keller defends the Netflix deal: "No one has any bad taste in their mouth."

The companies did not respond to requests for comment.

Go deeper

More than a dozen injured in downtown Austin shooting

Police tape in Austin, Texas in 2018. Photo: y Carolyn Van Houten/The Washington Post via Getty Images

A shooting in a busy part of downtown Austin, Texas, early Saturday injured at least 13 people, including two who are in critical condition.

The state of play: Gunfire erupted around 1:30 a.m. along 6th Street, a popular area with bars and restaurants. The suspected shooter remains at large, Austin police said. "It is unknown if there is one, or multiple suspects involved," they noted, adding the shooting appears to be an isolated incident.

Biden to urge G7 to take unified approach to countering China

Photo: Hollie Adams/Bloomberg via Getty Images

President Biden on Saturday is expected to urge fellow G7 leaders to adopt a unified approach to countering China's rising global influence, AP reports.

Driving the news: The G7 leaders are set to unveil a multi-billion-dollar global infrastructure plan aimed at rivaling Beijing's efforts in the developing world.

Why America's post-vaccine summer is off to a slow start

Illustration: Sarah Grillo/Axios

Americans are itching to put pandemic life behind them, but many of the necessary ingredients for a summer of carefree fun — everything from neighborhood pools to car rentals — still aren't fully available.

The big picture: Labor shortages, scrambled supply chains and simple logistics are all making it harder for a whole range of businesses to meet post-pandemic demand, and that’s making “hot vax summer” a little harder to pull off.