3/12/2010

By Michael Tinmouth

It's been a busy month for the government post Spending Review with a raft of announcements designed to soften the blow of spending cuts and to stimulate economic growth.

In recent weeks the private sector has been tasked with driving the economy forward and there's been no shortage of government announcements supporting business and technology. But whilst new government money and strategies will hopefully encourage employment and innovation, what effect will this government blueprint for entrepreneurialism have on the landscape of tech Britain?

The first details of 'new' tech Britain emerged in October when David Cameron announced plans to create a series of technology and innovation centres across the UK, this was followed in November when he unveiled of plans for a new 'Tech City' in East London.

Thriving tech hubs have been anything but predictable in nature, sometimes organic in their growth but more often expanding through association with education. Silicon Valley grew from a military technology and communications centre in the 1940's and expanded further through its collaboration with universities to meet the educational demands of GI's returning from the second world war. Other hubs such as our own 'Silicon Roundabout' in Old Street have become synonymous with technology start-ups. The 'Silicon Roundabout' initially grew out of the dotcom era in an area with cheap rent, cheap beer and a creative buzz, expanding from around 15 tech start-ups in 2007 to more than 100 today.

Of course Britain's foremost technology super hub sits at 'Silicon Fen' in the Cambridge cluster of technology companies closely but informally associated with Cambridge University that is now estimated to employ 43,000 people in 1,300 technology companies and which in 2004 were said to account for 24% of the UK's venture capital investments.

From a flexible and often organic growth pattern, Britain's technology sector is now a key part of the government's new National Infrastructure Plan. The PM's announcement in October that the government would spend more than £200m over the next four years on the Technology and Innovation Centres (TICs) and the flagship Tech City in East London will come as welcome news to many. The aim of the Fraunhofer-style centres according to David Cameron is to unlock £200bn worth of public and private sector investment while bridging the gap between innovation and commercial success.

The Technology Strategy Board will oversee delivery of the national network of technology and innovation centres with the initial strategy documents due for release in May 2011. David Cameron described the synergy of the project as being that "these centres will sit between universities and businesses, bringing the two together. They won't just carry out their own in-house research, they will spread knowledge too, connecting businesses, large and small, new and old, to potential new technologies, making them aware of funding streams and providing access to skills and equipment."

It appears obvious that in order to build a knowledge economy we need, not a reinforcement of old industries, but an industrial base that is aligned with our enviable research potential; that can build on the success of university knowledge transfer; and that fosters a demand-creation agenda. The technology hubs will complement and link with other work that the Technology Strategy Board already promotes, by fostering closer ties between universities and business.

Collaboration between business and research universities is however nothing new; the governments high profile backers for the London Tech City project have for a number of years already been working with UK universities. Microsoft, Philips and IBM have already partnered with UK universities to create digital technology hubs, based at Newcastle, Nottingham and Aberdeen universities.

What the Technology and Innovation Centres and the government investment do however indicate is that the UK seems to finally be acknowledging the truth that for some time it has lagged behind other global competitors in turning great ideas into goods and services. It is also time to accept that the UK has fallen woefully behind competitors such as Germany, where the government actively focuses on support for innovation. The result can be seen in international PCT patent applications filed by German companies which continue to be many times higher than those filed by UK companies.

Under the government infrastructure blueprints we are likely to see shifts in the landscape but the nature of tech start-ups means that those who want to get on board will and those who don't will continue to develop and thrive in more organic clusters.

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