A New Hope
| Aug 14, 08 in Entrepreneurship, Internet, Web/Tech |  16 Comments |
Last week I delved a bit into the concept of business clusters and made a promise to address the subject of how a stronger consumer technology cluster may emerge in Atlanta. In the post last week I spent a lot of time focusing on one of Michael Porter's key findings in cluster development, that anchor companies play a disproportionate role in seeding cluster development. This week I want to pull another key finding that is not only important to cluster development but also to entrepreneurial opportunities into the discussion.
New firm and cluster opportunities arise at the intersection of existing clusters.
This is really an important concept and leads of course to the question of what types of clusters currently exist in Atlanta. As pointed out in the Porter report financial services,transportation/logistics are strong broad clusters and the technology cluster draws its roots on telecommunications and media. Beyond that I personally believe that we have strong technology clusters in logistics, Internet security, and payment processing. Maybe Internet services as well if you include the likes of Cbeyond, Cox, EarthLink, and Knology in that mix.
But roots in telecom and media. That is interesting. Real interesting. Particularly when one starts thinking about "new" media. I kinda hate the term. Nobody really knows what it means. Even Wikipedia, a new media form in and of itself fails. Webopedia has the best definition I could find:
New Media is a generic term for the many different forms of electronic communication that are made possible through the use of computer technology. The term is in relation to old media forms, such as print newspapers and magazines, that are static representations of text and graphics. New media includes: Web sites, streaming audio and video, chat rooms, e-mail, online communities, Web advertising, virtual reality environments, integration of digital data with the telephone, such as Internet telephony, digital cameras, and mobile computing.
In other words it includes a lot, including the fine content you can find on FoG. But it is much more than that and it just so happens that Atlanta has a pretty strong foundation in new media.
Atlanta has a strong foundation in new media? Here I go, being all crazy once again. But I typically like to back up my crazy statements with specific facts, so here goes.
According to Comscore Media Metrix (part of a long forgotten Atlanta win), three of the top 50 Web properties in the U.S. are based in Atlanta and have a combined reach of just over 50% of the Internet audience (in a given month half of the Internet user in the U.S. visit these properties). The properties are Turner at #12, Weather at #16, and Cox at #44.
Yeah folks, Turner's Web properties are the 12th largest in the country in and of themselves reaching 23% of all Internet users. This includes not only Cartoon Network but NASCAR.com, PGA.com, and PGATour.com among their smaller properties like TNT and TBS. Turner is a new media powerhouse. Larger then Facebook. By about 15%. Can you say anchor? And remember:
Anchor companies play a disproportionate role in seeding cluster development...producing numerous spin-out companies, which strengthen key elements of the cluster.
But that's not all. I wish I had full access to Comscore's numbers so that I could get a bit more granular, but I don't. Regardless, both Careerbuilder and Time Warner with CNN have significant presence in Atlanta. Significant like buildings full of people working on core new media services. In you include Careerbuilder and TW in the Internet reach numbers that I outlined above the total reach jumps to 78%. You can discard this if you want and my argument still holds. There is a strong new media cluster in Atlanta. Why no one talks about this is beyond me, but its there. I know it's there. And I am not alone. That gives me hope.
The 250 or so people packed into Turner last fall that sat and listened to 60 companies pitch their wares at the New Media Business Exchange gives me hope.
Noro Moseley Partners hiring Greg Foster to head up a new media practice gives me hope.
A very prominent new media entrepreneur/executive working behind the scenes to put together, for lack of a better term, a MediaLab (think a VentureLab that extends beyond the boundaries of Georgia Tech) focused on new media startups gives me hope.
Having 60 people come together over a weekend to create Skribit gives me hope.
The Boostphase effort, a seed stage investment company for capital efficient startups gives me hope.
Seeing two very interesting companies emerge from Turner in the past two months give me hope.
GVU's Journalism 3G gives me hope.
Sitting down with Georgia Tech students and watching their excitement as they explain their startup concept gives me hope.
AngelLounge gives me hope.
More Atlanta startups in the new media space then I can mention gives me hope.
I could go on. And I hear it in the comments already. Hope is not a strategy. And it's not.
But to paraphrase a certain senator from Illinois, that's not the type of hope I am talking about. It's much larger than that. It's the same hope that makes you want to go out and start a company. Or grow a company. It's the hope of a much larger opportunity. The hope of being part of something larger. A larger opportunity that we need to seize.
For me, it's more than hope. It's a belief. A belief that in the next ten years Atlanta can establish itself as strong in the new media space as we have in the Internet security space.
But hope and belief is not a strategy. Where does that leave us?
Let's go back to Porter's key finding, new firm and cluster opportunities arise at the intersection of existing clusters. Is he right? Yep. The most recent example. Firethorn. Financial services meets telecommunications. Acquired by Qualcomm for $210. Cha-ching!
Look at opportunities at the intersection of existing clusters. They are big. That really gives me hope.
But what would really, really give me hope is if everybody stops comparing here versus there. There wins. End of discussion. So let's talk about something interesting. What do you do to seize the opportunity?
What gives you hope?
Good thoughts, Lance. Two areas give me hope for Atlanta: online health information and social media/social networking.
I am biased as I am involved in both. However, look at the talent in Atlanta for next generation health information. A.D.A.M. has emerged as a major player. Many of WebMD's key content roles still exist here in Atlanta. Add in the American Cancer Society, CDC, the new Health Museum, you have an important cluster. Perhaps there is a way to pull all of these parties together to see about expanding Atlanta's focus and recognition in this most important field.
Second, social media/social networking is a natural for Atlanta. You mentioned the powerful online presence of large Atlanta-based media companies such as Turner, Weather Channel and Cox (though it is sad to see the big retreat from the newspaper industry recently announced by Cox, but it is good to see the emphasis they are now placing on new media with the purchase of Adify). ThePort Network, Vitrue, smaller start ups working on various Web 2.0 stuff, all of this should be celebrated and recognized.
Atlanta does have some clusters to build upon. With ATDC, Georgia Tech, ATA, maybe some support and help at the State and local level plus all the talented people we have here, I believe that we can do some great things.
Thanks for your leadership on this important issue.