Toronto falls short in bid to create a North American cluster for new media: Study

Toronto is losing as much as $3 billion a year and 30,000 jobs because the city is not reaching its potential as a new media cluster, according to a new study conducted by PricewaterhouseCoopers. Re-leased Feb. 4, the report, identifies a serious "digital content gap" emerging in the Greater Toronto Area. Although Canada's most prosperous region is still the country's largest business centre, this fact isn't reflected in the size, scale or stability of a new media cluster, the report's authors find. Comparisons with new media centres in other countries suggest that Toronto may be generating only half of its potential revenue in this burgeoning industry. "Toronto is conceivably losing between $2 and $3 billion in lost direct, indirect and induced economic output from this digital gap," the study states. "This equates to a minimum of 10,000 jobs directly and another 20,000 jobs indirectly. Moreover, the gap will most likely widen even more rapidly in the future if policy and program action is not taken soon." Despite the shortfalls, the study acknowledges that Toronto's new media cluster does have its strengths. The quality of the cluster's consumer- and business-directed products and services is rated high, and the GTA also benefits from a strong supply base of hardware platforms, software programs, and skilled people. "Indeed, Toronto's access to creative and technical skills is recognized world-wide," the report says. Much of that talent is coming from respected educational institutions in the GTA, including Sheridan College, the Bell Centre for Creative Communications (Centennial College) and the University of Toronto. Toronto's weakness, it appears, is the size and scale of its new media cluster, the lack of a unified voice and high-profile new media brand names. "The two most important strategies for policy and program action are, first, to ensure that new products and service development involves direct co-operation with specific customers ("dragging the customers into the lab"), in order to highlight the cluster's capabilities to clients, and second, to provide external marketing support," the study notes. "As well, there is a requirement for the private sector to provide significant new financing for growing the cluster." Meanwhile, several Ontario regions have received provincial money for new media development and broadband infrastructure projects. Since the New Year, it has provided: $1.7 million from the Telecommunications Access Partnerships program to the Simcoe Community Access Network to create high-speed telecom links between local governments, health care providers, educators, libraries and local businesses. Overall budget: $4.7 million. $25.4 million from the Ontario Research and Development Challenge Fund for research projects led by Queen's University in high performance computing and high growth business. Just over $7 million of the contribution will be used to support chairs and to help recruit faculty members in the computational sciences. Queen's University, Carleton University, the Royal Military College of Canada, the University of Ottawa, Sun Microsystems of Canada Inc, Entrust Technologies, and IBM have committed an additional $14.6 million. $6.7 million for research to be carried out at the new National Capital Institute of Telecommunications. A further $19.6 million is being contributed by Carleton University, the University of Ottawa, the National Research Council, the Regional Municipality of Ottawa-Carleton, the Communications Research Centre, Newbridge Networks Corp, Nortel Networks Corp, Bell Nexxia, and QNX Software Systems Ltd. Research areas include: fibre optics and wavelength division multiplexing technologies; broadband wireless and component technology evolution; network management and software for evolving distributed computing systems Internet technologies; multimedia communications and applications $6 million from the Interactive Digital Media Small Business Growth Fund for five Toronto-based digital media and telecom network projects. A sixth project will receive TAP funding to build an electronic network for designers. $1 million from the Interactive Digital Media Small Business Growth Fund to further develop Toronto's New Media Village. The money will cover half the cost of a new $2-million business hub to attract investment and create jobs in interactive digital media.

Toronto falls short in bid to create a North American cluster for new media: Study

News | 03/20/2000 5:00 am EST

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