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Can the UK Create Something To Rival Silicon Valley? 395

Posted by timothy
from the why-not-favorable-conditions-everywhere? dept.
An anonymous reader writes "Hoping to bring together ambition, creativity and energy in one place, the UK government hopes to grow East London so that we can benefit from the same sort of success that has been seen in California; jobs, tax revenue, highly skilled workers and takeovers. If it works, the country would massively benefit, with something to rival other established industries."
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Can the UK Create Something To Rival Silicon Valley?

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  • by conner_bw (120497)

    I don't want to be pedantic but in the UK it would be called Silicon Football, not Valley.

  • Assange (Score:5, Insightful)

    by bradclarke77 (1900464) on Thursday August 30, 2012 @01:41PM (#41180351)
    A good start would be not offering to arrest and deport people who broke no law in your country.
    • Re: (Score:2, Insightful)

      by Jeng (926980)

      Not sure why this is being labeled as offtopic, it is a legitimate concern.

      • Re: (Score:2, Offtopic)

        by hackula (2596247)
        This is legitimate like not going to San Fran to avoid seal attacks is legitimate.
        • by Jeng (926980)

          There are a lot of people who have done things that the US is not happy about, a lot of those people are in the technology field, they may not want to move to a country where they could be easily extradited.

          Kim Dotcom is a better example than Assange.

    • Agree. Not off topic at all.

    • Given the incarceration rate in California I don't think the aggression of law enforcement has a whole lot to do with anything. Remember that the only reason this whole incident has happened is that Assange is afraid of the USA - not the UK or Sweden.
  • Old joke. (Score:5, Funny)

    by Anonymous Coward on Thursday August 30, 2012 @01:42PM (#41180353)

    The UK doesn't have any PC manufactures.. ..Because they have not yet found a way to make PCs leak oil.

    • by Jeng (926980)

      They should get with the Taiwanese, they found a way to make PC's leak petroleum products.

      http://en.wikipedia.org/wiki/Capacitor_plague [wikipedia.org]

      Electrolyte leaked onto the motherboard from the base of the capacitor or vented from the top, visible as crusty rust-like brown deposits. The petroleum-based adhesive that is sometimes used to secure the capacitors to the board can be confused with leaked electrolyte; electrolyte is usually wet, adhesive is dry. The glue is a thick elastic covering usually of a sandy yellow

    • Old. Who cares? That was awesome.
  • No. (Score:4, Interesting)

    by Anonymous Coward on Thursday August 30, 2012 @01:42PM (#41180355)

    Look at what happened with the Raspberry Pi, import taxes pretty much sunk any possibility of building it in the UK.

    • "Silicon Valley", especially the sort of latter-day web 2.0 Social bullshit that people seem interested in these days, isn't exactly a manufacturing-heavy operation...

  • by Quakeulf (2650167) on Thursday August 30, 2012 @01:42PM (#41180357)
    I am one of those people who came to the UK to jump form a successful startup (Playfish) to another successful startup (Plumbee), but my main problem is finding a place to stay that works out. I want a place that is: - Close to the office - Got decent standards - Is affordable - I can have for a long term In London I can only choose two from that list. Then there are extremely greedy landlords and sleazy estate agents that will only want to fool you of your money in a not so well regulated business. This is practically making it impossible for me to be able to save up money and continue to do my job here, and is the main reason for me wanting to move away from London as soon as possible and leave this wreck of a housing market behind.
    • I want a place that is: - Close to the office - Got decent standards - Is affordable - I can have for a long term In London I can only choose two from that list.

      Oh please! That problem is as ancient as civilization has been recorded. You simply want what everyone else wants. It doesn't matter if it's Rome, Shanghai, Houston, NewYork, Paris...etc. It's fits right along with Cheaper-Faster-Better. You can only pick two.

    • by gbjbaanb (229885)

      he's got a point though, why must it be in East London of all places? Surely somewhere nearer Cambridge or one of the many Oxford science parks would be a better choice. Even Reading would be significantly cheaper (ie near the Corporate Playground that is Winnersh).

      Of course, if I set up a company, I'd base it in the lake district or the Cornish coast. I don't think I'd have many problems recruiting staff who'd be happy to relocate to those places.

      • he's got a point though, why must it be in East London of all places? Surely somewhere nearer Cambridge or one of the many Oxford science parks would be a better choice. Even Reading would be significantly cheaper (ie near the Corporate Playground that is Winnersh).

        Of course, if I set up a company, I'd base it in the lake district or the Cornish coast. I don't think I'd have many problems recruiting staff who'd be happy to relocate to those places.

        I agree. This smacks of the usual "we must regenerate East London at all costs!" attitude which has been prevalent for the past 50 years. The first successful wheeze was making it a financial hub (which worked, see Canary Wharf), but now banks are evil e.t.c and that won't do. Then the Olympics were going to transform East London into a global hub of running around. Now it must be a global hub of technology.

        As I understand it, a large part of the early success of Silicon valley was due to a glut of educated

    • by xelah (176252)

      Yes. London is heavily overcrowded, the housing is tiny and very expensive, the transport infrastructure expensive and congested (including trains). Trying to start a new cluster of an industry there is insane at all, especially one full of startups that can and do benefit a great deal from a very low cost environment.

      But businesses like London because there's a big pool of employees to choose from, and a big pool of suppliers, accountants, lawyers, banks and so on. And it's the people at the top who earn h

  • A new wild west (Score:4, Insightful)

    by StripedCow (776465) on Thursday August 30, 2012 @01:43PM (#41180393)

    What we actually need is a new "wild west". A place where there are no artificial restrictions like patents, lawyers and what not so that innovation can flourish.

  • Stillborn (Score:4, Insightful)

    by udachny (2454394) on Thursday August 30, 2012 @01:44PM (#41180409) Journal

    the UK government hopes to grow East London so that we can benefit from the same sort of success that has been seen in California;

    - DOA, just like Russian version of Silicon Valley (Skolkovo).

    That is unless the government in UK is planning to get rid of regulations, taxes, labour laws and inflation of-course.

  • by loufoque (1400831) on Thursday August 30, 2012 @01:44PM (#41180413)

    Why not try to do it in Cambridge? It's already a major technology cluster, better invest there than to try to recreate something from scratch...

    • Re: (Score:3, Informative)

      That wouldn't displace enough poor people.

      • by Tastecicles (1153671) on Thursday August 30, 2012 @02:28PM (#41181031)

        Nottingham has tried it several times already.

        Highfields Science Park began as, and is still, a niche research facility owned and administered by the University of Nottingham. Its original commercial intent was as a supportive facility for tech startups.
        The Lace Market quarter was renovated and equipped with facilities aimed at Dotcom startups. Failed. Most of the units now sit unused and unoccupied, and almost entirely owned by New College Nottingham and now used mainly for storage.
        The Howitt Building was renovated much as the Lace Market was, as a springboard for tech companies. Has never had more than 25% occupancy. Owned and run as a secured building by the City Council, with the accompanying extortionate office rents.
        The Island Business Park is currently occupied by the BBC, Experian, Capital One and the NHS. Little else, more than half the site is still undeveloped.

        We're talking about the place where electron microscopes, CAT scanners, and several more of the most amazing medtech breakthroughs in history have been made. *Nobody* is interested in setting up shop there except Boots, Capital One, Experian and Games Workshop?? Makes me wonder why...

        • by Cederic (9623)

          Nottingham has tried it several times already.

          (...)

          *Nobody* is interested in setting up shop there

          Probably because the city council is stupidly anti-business.

          The local population doesn't really have a history of working in 'intellectual' industries. If you want a skilled or unskilled labour workforce then sure, come to Nottingham - but the manufacturing industry just doesn't employ as many people as it used to.

          Nottingham attracts a lot of students (and has a great university) but then suffers the self-perpetuating cycle of "There are no good graduate jobs"->"Graduates leave Nottingham"->"Businesse

    • by mickwd (196449) on Thursday August 30, 2012 @02:15PM (#41180831)

      Indeed. The area around Cambridge has also been known as "Silicon Fen".

      Or what about somewhere like Manchester - a big city with an important place in the history of computing, a large, well-regarded university, and a large pool of experienced, well-qualified people?

      But no, once again it seems to be London that gets the attention.

    • Why not both? London to Cambridge by train is only 50 minutes. Silicon Valley, meanwhile, refers to the bay area between San Francisco and San Jose. It takes more than an hour on the Caltrain to go from one end to the other. The USA is just really huge.

  • Quick Answer: (Score:5, Insightful)

    by qubezz (520511) on Thursday August 30, 2012 @01:46PM (#41180449)
    No [wikipedia.org]
  • The first sentence of that article is "With the Olympics about to get underway"...

    Why is such an old article coming up?

  • Really? (Score:5, Insightful)

    by Sparticus789 (2625955) on Thursday August 30, 2012 @01:47PM (#41180459) Journal
    "same sort of success that has been seen in California; jobs, tax revenue, highly skilled workers and takeovers."

    What is the author smoking. California currently has $380 billion in devt [usdebtclock.org] and a 10.8% unemployment rate [google.com]. I would call that far from being successful.

    If I were the UK, I would not want to model anything after California

    • Re:Really? (Score:5, Interesting)

      by girlintraining (1395911) on Thursday August 30, 2012 @01:58PM (#41180611)

      If I were the UK, I would not want to model anything after California.

      Anything modeled after California is known to cause cancer in the State of California. But only slightly more seriously, there's a subtle distinction between comparing what happened in California with what happened to California. The company with the largest market capitalization of any on earth is located there. Ten years ago, The Company Which Must Not Be Named was barely a blip on anyone's radar. There are many success stories to come out of Silicon Valley, and understandably, many business-minded folks would like to replicate that success.

      Unfortunately, they're suffering from a massive case of survivor bias [wikipedia.org]. It's true that silicon valley has birthed some of the largest, most successful tech firms out there. It's also true that the valley is littered with the corpses of failure. During the dot com bust, companies were erecting fences to keep creditors from repossessing the cars out of company lots. Silicon Valley's success story should be likened to another California success story: The California gold rush [wikipedia.org]. You can't discuss success without also discussing the odds of failure.

    • by daem0n1x (748565)

      If I were the UK, I would not want to model anything after California

      Come on. Maybe the weather. Or the food.

      • Touche.... The weather in the Central Coast area would be great to replicate. Not so much the Central Valley, LA, or the desert.
    • It also has a GDP [wikipedia.org] nearly that of the UK, despite having 25 million less inhabitants. To compare, the UK is £1,278.2 billion in debt [wikipedia.org] with an unemployment rate of 8%. Tech is also a growth industry which the UK needs since it is now too dependent on financial services, a sector that hasn't been doing especially well. That said I don't think this scheme will succeed but you can see why they would want it to.

  • by dorpus (636554) on Thursday August 30, 2012 @01:54PM (#41180545)

    The vast majority of SV ventures have been expensive failures. It's essentially a welfare economy subsidized by venture capitalists who prey on the ignorance of non-technical investors. The rare ventures that succeed tend to move out of SV. The vast majority of SV workers never get rich; they move elsewhere when they are past age 30 and are no longer welcome. SV puts out its hype about the virtues of "hard work", "two men in a garage", and "no government" -- though in reality, it's about knowing the right people, being in the right place at the right time, and making most of their money from government contracts. Most scientific advances happen outside of SV, and most successful high-tech businesses are based outside of SV. I would say that SV is just a mysique created by the banking industry.

    The future of high-tech leans toward medicine. SV is not strong in medicine; they just have bubbly biotech start-ups that typically disappear within a year. The successful high-tech business of the future will depend more on interactions with non-IT people, but SV's homogeneous population places it at a disadvantage there. SV does not have large numbers of health care professionals, industrial technicians, or other types who would provide valuable input.

  • So they can't pull the 80 hour work weeks or useing temps as full time long term in place of employees.

  • by Tester (591) <olivier@crete.ocrete@ca> on Thursday August 30, 2012 @01:59PM (#41180627) Homepage

    Different places have different specialties.. And when a place attracts lots of people who know something, it becomes a pole for that thing, generates high salaries in that field, and make life very expensive for everyone else. Silicon Valley, Bangalore, etc do high tech. New York, London, Hong Kong do banking. You can't have all of them. And I doubt a small-ish country like the UK can have many of them. The US can afford to have New York and Silicon Valley because they're very very far appart. The City is just too close to East London (or even Cambridge) to make them separate markets, meaning that old humid houses are still terribly expensive and no one in their right minds would want to move there unless they are made tons and tons of money.

  • by 7-Vodka (195504) on Thursday August 30, 2012 @02:02PM (#41180665) Journal

    It's a pointless question. Let me explain:

    Theoretically, the UK could try to accomplish this. The main barrier preventing any type of industry from flourishing in the UK is the obscenely high effective tax rate on human activity. (please give this typical figures, maybe in percentage if you're more familiar Brits)

    The UK could then make an attempt to relieve a certain location and industry of these high taxation burdens to have the locus flourish.

    The problem is that while this is a good move and should be applauded, simply cutting taxation on human activity without cutting the corresponding government spending doesn't solve much. The spending has to be paid for somehow, whether that is immediately by confiscating funds from other people and locations or somewhat delayed by building deficits and inflating the fiat money supply and thereby causing the mis-allocation of resources and bigger busts and recessions or depressions, people will continue to pay the piper.

    The only sure way to encourage industry to flourish is to cut regulation and cut government taxation and spending. Remember, most government taxation is appropriating funds from a more effective use determined by the market, and instead putting them to less effective use as determined by bureaucrats.

    • ...cut regulation and cut government taxation and spending

      Then you can have Silicon Road Warrior:
      "Greetings from The Humungus! The Lord Humungus! The Warrior of the Wasteland! The Ayatollah of Rock and Rolla!"

      • by ArsonSmith (13997)

        Don't mock the liberals there are some who actually believe this in the face of all long term contradictory evidence. It's like creationism for liberals. They get all happy on the short term successes that socialism can create but ignore the fact that long term it has never lasted.

    • Re: (Score:3, Informative)

      by bluec (1427065)
      You're talking (typing) out of your hoop. The UK tax rates on "human activity" are not obscenely high. In fact we have some of the lowest personal and corporate tax rates in the whole of Europe (List of countries by tax rates [wikipedia.org]). There are many reasons why this scheme could/would fail but tax rates are not one of them, unless you consider any form of taxation a problem.
  • ... do they really want that?

  • The boat sailed... (Score:5, Insightful)

    by jamstar7 (694492) on Thursday August 30, 2012 @02:04PM (#41180711)
    The boat sailed on a Silicon Valley workalike about 25 years ago. What with all the tech patents, software patents, business model patents, and patent trolls sewing up innovation unless you're already IBM, Microsoft, or Apple, you won't be able to innovate and defend anything What are they thinking, incubate and develop the next Facebook? The next PayPal? TechLawyers.com?
  • by Anonymous Coward

    A lot of things have to come together to create a 'Silicon Valley'. 1. You need a university center of excellence (like Stanford University) that actively promotes the high technology business. They have (or at least had) leases on land in the Santa Clara Valley, and offered good rates to fledgeling technology companies. 2. You have to have an entrepreneurial spirit: this isn't some 'I just graduated from business school, now I want my million dollars' boob, you need someone who has an idea or a set of i

  • No. They can't. (Score:4, Insightful)

    by gurps_npc (621217) on Thursday August 30, 2012 @02:12PM (#41180793) Homepage
    To quote Paul Graham (http://www.paulgraham.com/maybe.html and http://www.paulgraham.com/siliconvalley.html [paulgraham.com])

    You need to find someone to pick the right start-ups. Those people are rare, and unlikely to work for a city.

    You need a pro-privacy, pro-free speach atmosphere, something that UK seriously lacks. (Cameras, libel laws, etc)

    You need a good source of well educated people interested in science, not business.

    You need a good place to live. Something that will attract smart people to live there besides the money. The UK is not sunny California.

    • Re:No. They can't. (Score:5, Informative)

      by IamTheRealMike (537420) <mike@plan99.net> on Thursday August 30, 2012 @02:44PM (#41181265) Homepage

      Your summary of the article is stupid. None of those sentences are quotes. In fact the article states at the end that SVs great weakness is that it's a crap place to live, directly contradicting what you wrote. Here's an actual quote:

      For all its power, Silicon Valley has a great weakness: the paradise Shockley found in 1956 is now one giant parking lot. San Francisco and Berkeley are great, but they're forty miles away. Silicon Valley proper is soul-crushing suburban sprawl.

      Yes, yes it is. Having lived temporarily in the Valley and grown up in the UK, I'm pretty sure I don't want to live along the US-101. I'd do it if there was some really compelling reason, but otherwise no thanks - love the sun, hate the driving. Rents and property prices in London are absurd and most likely still a bubble, but other than that it's not a bad place to live at all.

      Your other points (not quotes) are also pretty stupid. There are a ton of well educated people in London, as well as many Brits working for Silicon Valley based companies. The UK has a long history of computer science, you know about Bletchley Park, right? The BBC Micro? The government doesn't deserve any credit for it (the BBC does!) but there were a ton of people growing up in the 80s and 90s who had access to really good computers and lots of educational material about them. It certainly got me started. At 28 I'm now a senior engineer at Google (in Switzerland).

      BTW I think it's really great that companies like Amazon, Facebook and the big G have set up shop in London. These companies are great at training people who can then develop the confidence and skills to go do their own companies (Facebook was practically made of ex-Googlers back in the day, don't know if it still is). Especially anything internet related that might scale up fast will benefit a lot from the pool of skilled workers these companies will attract and create.

  • by jeffmeden (135043) on Thursday August 30, 2012 @02:12PM (#41180801) Homepage Journal

    so that we can benefit from the same sort of success that has been seen in California

    Yes, and for free, if you order now, you will also receive:
    *Crushingly high real estate prices
    *Monstrously overcrowded prisons
    *Bankrupt schools

    BUT WAIT! THERES MORE! Be one of the first 100 callers and receive, as our special gift to you:
    *Shortages of electricity and water!
    *Political leadership totally devoid of morality, consistency, or backbone!

    But seriously, California is a "hotbed" for ONE single reason: The weather is nice pretty much all year long. Anyone who lives there and tries to sell you on something else is lying to themselves. People go for the nice weather, and they put up with the constant bullshit because hey, it like never snows, unless you live in the mountains, which are only like 2 hours' drive away from the beaches... So why not live there? Right? And once you get enough smart people in one place (they are bound to turn up when you have 30 million people to start with) things just sort of take shape.

    So, UK, you want your own Silicon Valley? Get a warm-weather generator, a couple of nice schools, a semi-pristine coastline, then fill it over the top with people, and wait 50 years. You will probably get something like that, or hey maybe you will end up with something like Haiti. Could go either way.

  • by alexmin (938677) on Thursday August 30, 2012 @02:16PM (#41180841)

    Until then the question is moot.

  • Clueless politicians sometimes have these ideas which, on the surface at lease, seem like a good idea.

    Unfortunately, they have no earthly idea how to implement these ideas; and indeed, the very political nature of their jobs and way of thinking precludes them from doing so.

    To draw an analogy, it's like trying to grow a forest by transplanting seedlings, without considering issues like soil quality, moisture, or environment.

    Businesses are started by innovation, and grow in an environment of infrastructure.

    Wh

    • by xaxa (988988)

      What is the infrastructure in London like? Is there easy and direct access to roads, or is there draconian limits on driving in the city. Is there universal access to high-speed internet, or are there restrictions on what you can do with your net connection?

      The roads aren't the primary transport infrastructure in London (that's railways), the limits actually help companies (by reducing congestion). But as a way to start your comment, you seem like you've made up your mind already.

      I'll answer your questions very quickly: Internet yes, restrictions no, business *extremely* easy, tax breaks no, political favours not really, tolerance for ideas yes, radical political ideas yes, libel is complicated (and how is this going to affect you anyway?), the IP stuff is gl

  • by Anonymous Coward on Thursday August 30, 2012 @02:25PM (#41180981)

    If you want a "silicon valley" in the UK, don't target East London. Extend what you have and go for Reading [pronounce "REDDING"], which as it happens is already nicknamed "The silicon valley of the UK". Comfortably, Reading is already the home of many small unknown companies such as Oracle, Nvidia, Microsoft and Symantec.

  • The problem with trying to create something like this, is I'm not sure that Silicon Valley was 'created' per se.

    It seems like it happened because you had a couple of companies (HP for example) who set up shop there, and then other stuff grew around it. I'm not sure you could just go out and say "OK, we'll put a center of innovation and technology here".

    It sort of has to grow organically I should think.

    I used to work with someone who grew up in what is now Silicon Valley. He said at the time, it was a very

  • by cardpuncher (713057) on Thursday August 30, 2012 @02:32PM (#41181085)

    It's a recurrent theme in British politics. Look up Harold Wilson's 1963 "White Heat of Technology" speech and the creation of the Ministry of Technology.

    Britain within living memory has been a technology leader in aviation, nuclear, computing, Those were largely developments that came out of the war and declined in the face of a dependence on government money for investment (and in the latter case, an unwillingness to admit even to the existence of the technology).

    Private investors aren't interested in long-term investments - the "investment banking" industry has become big largely because it's eschewed actual growth-producing investment for complex financial instruments which are essentially a form of privatised taxation.

    There is still a lot of high-tech industry (take Rolls Royce aero engines for example), but it survives and grows pretty much in spite of the business environment. It's no accident that Britain's now successful, productive and growing car industry is owned and financed from Japan, Germany and India.

    It may be possible to grow IT-based industries in London, but they won't be owned in London and nor will any IP associated with them. And I'm afraid the government is sufficiently clueless about technology that it might actually feel it needs to encourage businesses like those cited by the article ( Instagram, Skype and Groupon) whereas there is probably a lot to be said for actively discouraging them.

    Plus, this seems to be all about exempting businesses from paying their normal dues. I'm all in favour of foreigners spending money in London. I'm not in favour of the government giving it back with interest to encourage them.

    • Private investors aren't interested in long-term investments - the "investment banking" industry has become big largely because it's eschewed actual growth-producing investment for complex financial instruments which are essentially a form of privatised taxation.

      Well said. It is with deep regret that I have to report that back in the previous century I was working in a department that was one of the leading forces in bundling and selling mortgage and mortgage servicing portfolios. In other words, we were supposed to predict what those bundles should be worth over 10, 20, year years or so. um, yeah.

      For doing this, we'd get something like .01 of 1% in fees as each billion-dollar bundle flew by. To mis-apply the late Senator Dirksen: a billion here (or .0001 thereof),

  • Join the club (Score:4, Insightful)

    by IcyHando'Death (239387) on Thursday August 30, 2012 @03:09PM (#41181671)

    The world is full of urban centres that are trying to emulate the success of Silicon Valley. Ever heard of Silicon Valley North? No, I don't mean San Francisco. It's a term my home town, Ottawa, Canada, has adopted for itself. It's also been applied to Toronto, Vancouver, Waterloo, Calgary, and Montreal. But the truth is that none of them have a decent claim on the title -- they can't touch the real Silicon Valley in terms of scale, depth of expertise or level of innovation.

    There's a big barrier to anyone trying to be the new Silicon Valley and it has nothing to do with corporate tax rates or research incentives. Those are all easy to measure and copy. It's the network effect -- the same one that makes eBay, the QWERTY keyboard and Microsoft Office so hard to displace. The smart people want to go to Silicon Valley because that's where the smart people are. After all, being with other smart people is not only more interesting, but more likely to lead to your own success. It's easy to see in a place like Ottawa, where the cream of the tech community are frequent targets for Silicon Valley head-hunters. They go, not (just) for the money, but to be part of that scene.

    So good luck East London, but maybe you should have a plan B, just in case.

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