Does the UK really need a technology hub?

Charlotte Nicol
Published on 9th April 2013
2 min read

Great article in Tech World by Sophie Curtis following the technology hub debate held at the recent Sage People office launch.

The Tech City project has been met with a mixture of pride and disdain from the IT industry. Some welcome the government’s acknowledgement of the technology sector’s role in Britain’s economic recovery, while others dismiss the London-centric view as biased and short sighted.

Indeed, as I noted in a previous blog, the hype around Silicon Roundabout has given rise to a number of other technology clusters around the country claiming to be the ‘real’ Tech City, including Manchester, Newcastle and Milton Keynes.

But does the next generation of technology businesses really need to rely on a physical hub to survive? Surely in the age of globalisation, proximity is no longer a prerequisite for collaboration?

This was the subject of a debate at the launch of HR technology start-up Sage People‘s new global headquarters in Reading last month. One of the most controversial points was that we are no longer seeing the next frontier of tech coming from these hubs, but rather the development of existing ideas with incremental changes.

It was argued that more innovation comes out of areas that do not have hubs, like Sweden which produced Linux, or Estonia which produced Skype, creating things that are of real value and changing the way people interact with technology and each other.

This is a tricky point to prove. Certainly the global success stories coming out of places like Tech City have been few and far between, with most start-ups developing a variation on a theme, such as social business or big data, and many being bought up by larger rivals, but can this really be linked to their involvement in a hub? I’m not so sure.

It is fair to say that hubs are not necessarily a guarantee to success. This is a function of a broader culture, and depends on the demand in the wider market. Moreover, physical hubs can offer limited access and potential for growth, while alternatives such as telecommuting often enable people to be more productive.

The argument in favour of hubs was based largely on having cutting-edge communication, infrastructure and technology, as well as access to a local talent pool. Unfortunately, anyone who has visited Tech City will know that the infrastructure is far from cutting-edge, and while some of the talent is local, much of it comes from abroad.

In reality, the real advantage of being part of a cluster is the opportunity to interact with other like-minded people and fuel productivity through competition and collaboration. The lifestyle can also be a big attraction, providing access to housing, schools, healthcare and shopping.

These things alone will probably be enough to keep the ‘cluster’ concept going. Man is by nature a social animal, and workers are likely to suffer from a stagnation of ideas when working alone, unable to bounce off colleagues or get excited by their enthusiasm.

However, that does not mean that those who are not in the hub cannot be part of the community and produce just as many exciting innovations as those who are. We have now reached a point where technologies like social networks and video conferencing allow us to tap global talent pools and collaborate with companies from all over the world.

Enough, then, of these comparisons between clusters. Whether you are in Silicon Valley, Silicon Roundabout or Silicon Wadi – or the Outer Hebrides for that matter – there are plenty of opportunities for your business to thrive, and ultimately, the companies that are successful will draw people to them.

It is time to start thinking of the ‘hub’ in a more hybrid sense, where the community consists of not only those companies and individuals in a specific location, but also those that they interact and do business with in other locations – both throughout the country and abroad.

The hub of the future will not be a static entity, confined by an area code and the cost of office space. It will be a shifting and evolving virtual environment created by the people in it, to fit the purposes and working culture of their community.

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