This snapshot taken on 26/07/2008, shows web content selected for preservation by The National Archives. External links, forms and search boxes may not work in archived websites.
Stephen Timms MPCal-IT 2002 |
 |
|
| (Click picture for biography) | |
I want to begin by expressing support on behalf of the UK Government for stronger links between the hottest young companies from California and investors and companies in the UK. This is a good example of government and industry working together and the support from the British Consuls-General in Los Angeles and San Francisco and from Invest UK, our inward investment agency, has I know contributed significantly to the preparations for this event, as well of course as all the great work of the California Technology, Trade and Commerce Agency. It's not that long ago that I can remember being surprised on visiting Silicon Valley as a Treasury Minister to see that every advertising bill board carried a web address – as six months later they did in Britain too. It was a very exciting time. Everybody was talking about the Chinese takeaway proprietor who, taking pity on the penniless dot com entrepreneurs working in the lock up shop next door, accepted payment for lunch in the form of shares rather than cash – and ended up a millionaire. I went to Stanford University to hear about the superb mechanisms for capturing the commercial potential of the technology being developed there, and I enjoyed attending one of the regular hi-tech networking events for entrepreneurs. And we finished our visit by paying a reverential visit to the suburban garage where Hewlett and Packard had started it all by setting up their business in the 1930s. So in the UK, a high technology hotbed in Europe, like everybody else in the world, we look to California for inspiration and for ideas, not just in terms of technology but in fostering entrepreneurialism, and in having an infrastructure of consistent support for the industry. I want to underline today the great opportunities in the UK for Californian companies. Bill Gates has referred to the UK as the best place in the world to do e-business – its certainly our goal that that view will be widely shared. With rapid progress in every country, we know that we still have a great deal to do. But there is a good deal for us to take encouragement from too. Broadband services, for example, are spreading very quickly. With an unprecedentedly high rate of weekly sales of broadband connections, we see ourselves being set well on the way to being the most extensive and competitive market for broadband in the world. We already have the largest e-commerce market in Europe, and figures published recently showed that it grew by over 40% last year. The UK is the most deregulated market in Europe. The priority for us all in Government is to ensure economic stability and to deliver productivity growth. It is also our job to promote enterprise and to celebrate success. And companies in this sector have a vital part to play. We are focusing as well on the challenge of building a competitive and dynamic knowledge based economy across the European Union over the next decade. Over half of UK's external trade is with EU member states. Three million UK jobs depend upon that trade. Our ability to go on attracting inward investment, and to continue to be the most successful economy in Europe in doing so, depends, crucially, upon our place in the European Union. Following the green light in the referendum in Ireland over the weekend, enlargement of the European Union will bring more opportunities, more prosperity, more jobs. It will create the largest single market in the world - larger than the US and Japan combined - with nearly 500 million consumers. Independent research estimates a £1.75 billion boost to UK GDP and 300,000 new jobs across the current EU member states as a result. And Britain is without question the best place for Californian companies to locate to address that market as it takes shape over the next few years. What are the opportunities for Californian companies in the UK? The UK Software and Services Sector grew by 5.4% in 2001 to reach a value of £20.4 billion – overtaking the German market for the first time to become the largest market for software and IT services in Europe. The European IT Observatory forecasts that the UK will increase its lead over the next couple of years as the fastest growing Western European market. All of the major global players have key sites in the UK. Microsoft has its only research centre outside the US here in Cambridge. It has invested upwards of £50 million in this centre and intends that its activities will continue to expand. IBM has a big presence in the UK, operating through more than 20 locations and housing the largest software development laboratory in Europe at Hursley. Hewlett Packard has one of its most important research centres worldwide at Bristol, and the company has emphasised to me the priority it has attached to protecting that centre in its recent worldwide consolidation exercise. Recent data for last year showed that the UK is once again the most favoured inward investment location in Europe. We have succeeded in attracting around 40 per cent of all the Japanese and Asian investment into the EU, as well as 40% of all American investment. Nearly, 6,000 US companies have chosen the UK as their operations base in Europe. We have been pleased that Financial Engineering Associates, a Berkeley based software developer, has just joined them and established its European HQ in London with the help of Invest UK. We want to see many more following that example, and there are very compelling reasons for them to do so:
Importance for Venture Capital I am pleased to see that the venture capital community is well represented here today, and it is an important contributor to the development of this sector. Opening up markets and the ability to trade freely with the world's leading economies is absolutely critical for the success of venture capital. Venture capital thrives on opportunity. It will help to provide a stable framework within which companies can flourish. To illustrate how much venture capital can contribute, let me describe the situation in the UK. Since 1983, it has invested £35 billion in around 20,500 companies. £6.3 billion of that was invested last year, £1.5 billion of it in UK hi-tech firms. The latest figures from the British Venture Capital Association indicate that more than two thirds of the biotechnology firms, for example, now listed on the London Stock Exchange have been backed by venture capital. The UK biotechnology industry is the largest and most successful in Europe. But it is not only in the hi-tech sectors where venture capital has had an impact. Many of the UK's young dynamic leisure and retail firms have also enjoyed support in their infancy from venture capital. This has enabled them to expand rapidly and achieve national coverage. All over the UK, you will see branches of firms like Dolland & Aitchison, Books Etc, Waterstones, Whittards of Chelsea, New Covent Garden Soup Company, all of them started with the help of venture capital. It is estimated that over 8% of UK jobs are in companies backed by British venture capital. It is a formidable contribution to the development of a modern dynamic business sector in Britain today. Success of Cal-IT Cal-IT has been running this annual event for the past seven years, all of them in London. It has been good to hear that partnerships formed from introductions at Cal-IT have led to a number of major long-term investments. BT Ignite, for example, secured a $3.7 million contract with Visa for an authenticated payment programme that authenticates individual card-holders during online e-commerce transactions. This will be very important for us in the UK because worries about the security of online transactions is still an inhibitor to the growth of e-commerce. Visa 3-D Secure will go a long way towards addressing that concern. Another example has been the Reuters Greenhouse Fund investments in Yahoo, PacketVideo and phone.com (now OpenWave). And I know there have been many more. Those developments are good for California, good for the UK, and we want to see many more of them to add to the successes already in place. So, do participate fully in the event and take advantage of the many networking opportunities that Cal-IT offers! I've enjoyed the opportunity to join you today. |
|
|
|
|
Other speeches by Stephen Timms MP
(the following are available from the archive) |
|
