There has been a lot of talk about the secret of Silicon Valley’s success as the ICT powerhouse of innovation for the US and the world. Back in the days it was coined Silicon Valley because of the concentration of companies involved in the production of semi-conductors in the Santa Clara valley. Now it is synonymous with the dynamics of a much broader high tech sector in the Bay area, the place to be if you want to make it as a high tech (start-up) company. Even when a new IT paradigm comes to life from another place, opening up shop in the Valley is about the first thing you do if you are serious about your ambitions. Facebook for example originates from Cambridge Massachusetts but moved its HQ to Palo Alto in Silicon Valley in 2004 just four months after the company was founded.
The European Community and more in particular DG Information Society and DG Enterprise, has always envied Silicon Valley and has tried to copy the model to Europe. Throughout the last 25 years they propagated cooperation between venture capitalists, universities and tech companies. Has it worked?
The study “Mapping the European ICT Poles of Excellence” that was released earlier this year, offers some insight into where our tech hubs are located. The study aims to be the ‘Atlas of ICT Activity in Europe’ .
Source: Mapping the European ICT Poles of Excellence, EC 2014
To give you the gist of it: there is not one European Silicon Valley but 34 according to this study. So at least in terms of quantity Europe is doing rather well. To qualify for being called an ‘ICT Pole of Excellence’ a region should have a compound score of at least 40 points out of the possible hundred. The compound score is based on three important tech valley characteristics: level of ICT R&D, level of ICT innovation and level of ICT business activity. In total, 42 indicators have been used to populate these group indicators. A maximal score of 100 points is awarded to the number one tech region. All other scores are relative to this 100 point mark.
What can be concluded from this study? Well for one thing the hottest tech hubs are (#1) Munich, (#2) London and (#3) Paris. Not surprising? Out of the 34 tech hubs 12 are located in Germany, 7 in the UK, 3 in France and the Netherlands (!), 2 in Belgium, and one in Sweden, Finland, Austria, Spain, Denmark , Ireland and Italy. Amsterdam ranks 10th, just one place after Zuid-Oost Brabant but with a score of 64 points compared to Brabant’s 70 points. Also surprising is the fact that Barcelona isn’t making it to the list. Berlin’s Silicon Allee, deemed to be the most dynamic German tech start-up region, ranks only 15th. Not one East European country makes it to the list although the study looked at all EU countries.
The findings of the study are no doubt of great value for tech investors and start-ups deciding on where to be and where not. But with the focus of the study on the importance of location it raises the question of what is actually true about the promised benefits of our mobile society? The companies that make up the high tech sector are evangelizing the merits of mobile business, mobile working and the mobile society, while at the same time they are physically clustering because of the perceived synergetic location effects. The message from the tech sector is that the age of mobile everything will free us from commuting, wasting fuel and time, and will lower CO2 emission because your business and you are always connected with everyone at any time. But that same tech sector itself – and the tech hubs even more so – do not eat their own dog food. Maybe the tech sector – in spite of its innovative, clean and state of the art image – is still very much a conservative business where face-to-face collaboration and physical proximity are critically important to success. Whatever the reason, location seems to matter more than ever before.
