Can London replace Bangalore and Silicon Valley as the next technology hub?


London is emerging as the new technology hub. In the last couple of years there has been a lot of activity to establish London as a center of innovation. But why has this come about?

Well there have been three significant factors, one UK government allocating funds to develop the North east part of London. Dubbed the Tech City this is probably the most ambitious project supported by the UK government. No one at that stage would have imagined that it would grow to what it is today but at that time the impetus to this was given by the government.

Secondly London has emerged as a financial center. Located at almost the center of the world London now attracts capital from US, Europe, Middle East and the Far East. This source of capital is soon finding its way to technology start-ups. Many of them have hence set up base in London and constantly seek funds which are available.

Thirdly in the current global scenario innovation and intellectual property are the drives of economy. Since the Second World War there has been a dearth of innovation coming out of the region. In the technology space there has been absolutely nothing coming out of the UK region.

For a brief while Skype used to be based out of Soho in London but has since moved out and has been acquired by Microsoft. This is where US, China and India have dominated globally. It is then become imperative that these technologists are trying to reverse that situation.

But does London have the right environment to incubate tech companies?


Bangalore had the right conditions that led to the Tech Boom. For starters Bangalore was the seat of the Indian defense / technology Industry. Defense establishments like HAL (Hindustan Aeronautics) and ISRO (Indian Space research Organization) were based in Bangalore. With all the government money being pumped into these organizations it created the right environment for a technology center to start. Also Bangalore was the seat of some of the best Technology institutes in India, IISC (Indian Institute of Science) and also UVCE were the starting points for getting the right technologist who would form the core of India’s IT revolution.

Finally many organisations like GE, Infosys and Wipro had started off in Bangalore which further cemented its position as a favorite place for a technology start up. Many of the stat ups were formed by former Infosys and Wipro employees. For example Mind Tree was formed by former Wiproites like Ashok Soota and Subroto Baghchi.

Silicon Valley has similar advantages -One or two large companies like HP and Intel, Great University like Stanford, Huge sums of invest from the Defense.

Now London does not have any of these factors, and it is to be seen whether the lack of these factors can be overcome by the government initiatives, the access to capital and the sheer need to get more innovation in the technology space.

One such bright spark is the Silicon Round About, named so in July 2008 by Matt Biddulph (then CTO of Dopplr) to a set of 20 odd start-ups that came about in North east London. Today the area is inhabited by more than 85 firms with businesses that deal with areas like social networking for gamers to sites that connect local homes with travellers.

So in conclusion though there is a lot of momentum for London it has none of the advantages that either Silicon Valley or Bangalore had. It is to be seen it this does develop as one of the Global centers for technology or remains just a niche hub of technology start-ups.

Your comments are welcome!

  1. Dr Vikram says

    @Rajaraman Cound not agree more with you, Silicon Valley is very IP and Innovation driven. The state in Bangalore is not very good with not too many patents coming out. Hence the government support to infra becomes necessary. London I am not sure, and that is what provoked me into writing about it. What are your views on the same?

  2. Dr Vikram says

    @Rohit I totally agree, Finland recently passed a law which makes Internet access a constitutional right. But a lot of Bangalore Infra is either old or outdated. The city needs a massive overhaul.

  3. Rajaraman says

    I am not sure if keeping Bangalore and SV in same group is apt but SV is more dependent on its intellectual population in universities rather than friendly policies.At best, if it prevents British economy from long term decline path, it would be the best case IMO.

  4. Rohit says

    Bangalore needs development of world class infrastructure and continued government support to maintain its credentials, nothing else. It can still remain a “Technology Hub” if govt. helps.

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