Manchester top for tech now and in future
Scott Fletcher warns that London's Silicon Roundabout may primarily generate quite the wrong kind of industry spin
Manchester is the rightful owner of the "tech city" title, not post-Olympics London.
David Cameron has shown himself to be a typical London-centric politician with a bias against the north. It is a bold plan trying to hype up the space down there as Britain's answer to Silicon Valley. But Silicon Roundabout is only ever going to put investors in a spin.
We have the BBC up here in MediaCity, as well as Cisco and NetApp and global trading companies such as PZ Cussons, Co-operative Group and Umbro, Kellogg's, Adidas and Siemens. The northwest boasts the second-largest digital industry cluster in Europe.
Across the northwest, the creative and digital media sector employs 320,000 individuals in 32,000 businesses. No other European city region has invested more than Manchester, which has developed the largest purpose-built sectoral hub in Europe. Hundreds of millions are being spent on this digital infrastructure.
Part of this landscape is The Sharp Project (TSP) in east Manchester – a 200,000sq ft content-creation hub aimed at facilitating "start-up and grow-on" digital entrepreneurs. Work has already begun on Sharp 2 and Manchester also has the most resilient global internet connectivity in the country. It would continue to route internet traffic if London went dark. Now that's what I call a proper launch pad.
Start-ups in Manchester's Tech City are showing typical annual growth rates of 50 per cent. That is the norm, and this blueprint will enable true domination in this area by 2020, modelled on locations such as New York and Singapore.
Ultimately, Manchester has depth in top talent and a sensible cost infrastructure.
Meanwhile, London marches on, hauling in famous tech brands such as Google, Microsoft and Facebook for campuses of worker bees.
Giant "front bedrooms" will allow tech types to come up with things. But it is all just R&D stuff without an infrastructural backbone and real business support – something that we already have in Manchester.
It is becoming a car showroom for multinational internet superbrands that want a London postcode. But where does the hype meet reality?
Like Facebook's IPO – ever so slightly overcooked – the Tech City dream is a political ambition claiming potentially big numbers of so-called investors and jobs, but those numbers simply do not stack up.
It was launched in November 2010 with generous tax breaks and start-up grants. Yet the five-mile slice of east London dubbed Tech City has created only 500 new jobs, according to the Department for Business, Innovation and Skills. Considering its location, I cannot see that is any kind of success at all.
Isn't it about time we took Tech City around the UK, linking locations with the fastest possible fibre connections? How about removing the tax on fibre optic broadband to start with and investing in this fibre infrastructure as well as road and rail?
I heard that Sir Martin Sorrell, chief executive of WPP, the world's biggest advertising group, recently pointed out that there is no real strategy or plan for technology growth and the government is constantly blown off course by news events.
Make a lot of noise about how Tech City in London is the way of the future and sign as many high-profile tenants as possible and it is bound to work as a TV soundbite. Until something politically better comes along, that is. Or there is another election.
Beyond the façade, the businesses at work in Tech City in London are data-hungry heavyweights. Much higher capacity than is currently provided is needed to support a move into the cloud for services from distance learning to e-health (with which ANS in Manchester is heavily involved – although we have a sales office in the City of London).
Does getting infrastructure into that post-Olympics postcode make any real economic sense? I think not. Skyrocketing rents are already forcing start-ups out of the Olympic Park area and ultimately this will drive away talent.
The latest networking technology is not easily accessible to start-ups in Tech City anyway. Many have complained of poor connectivity, noting that high-speed internet availability is a business constraint in the Tech City footprint. Once again, Manchester and Salford are leading the way here in providing cloud services for business start-ups.
Tomorrow's technology must be available today, in the form of scalable fibre networks that can grow at the speed required by rapidly growing enterprises. But no one will press the 'on' switch in Tech City London. The government's own politically correct broadband strategy has set out to improve the situation for rural areas and large cities, but will not favour or emphasise tech hubs such as Tech City. Bizarre!
Cameron will not look reality in the eye on this because the budget blowout of the Olympics is hard to justify without a grand plan. Tech City London, though, is not about having a well-thought-out plan for the UK tech industry, it is all part of the politics of the Olympic dream – which could turn into a nightmare as most poorly thought-through government projects do.
The coalition is not on the most solid ground, either. A different politician will see a different way to sell the space, leaving everyone who moves their tech business into the area high and dry.
Where is the north's Olympic legacy? The world's first-ever stored-programme computer – called the Manchester Baby – ran the world's first programme at Manchester University on 21 June 1948. Manchester is the rightful home of tech – from birth, through rapid growth, to maturity.
Scott Fletcher is chairman of ANS Group