The region can instead focus on creating the right conditions for innovation to flourish in order to prepare the digital sector to make the best of any future upturn in the economy.

Based on the reflections in this report those conditions include:

• Support further demonstrator projects in the use of digital technologies but with a focus on supporting the digital transformation of public services.
• Promoting Birmingham and the West Midlands as a centre of excellence in partnership working to support the digital transformation of public services.
• Supporting the development of a co-working spaces or ‘hack labs’ where new services can be developed and users can interact with technologists.
• Supporting developments to the digital infrastructure, including bringing high-speed fibre networks to specific ‘digital districts’
• Examine the strategic organisation of the cluster programme at Advantage West Midlands to better reflect the meshing of creativity and technology that happens in industry.
• Investing in research into user interaction with digital technologies and promoting the dissemination of this knowledge to technology businesses.

The public sector has a key role to play in facilitating that innovation. Not just in supporting digital entrepreneurs by creating the right kind of working spaces and in creating appropriate investment vehicles but also in freeing up the data sources from which new services can be created and by facilitating access to public service transformation agendas.

National government has already identified two interventions from local social media experts and highlighted them in national reports: the plain English translation of the city’s Big City Plan by a group of civic-minded bloggers and the role of hyper-local blogging in the Digbeth area. Birmingham and the West Midlands has the opportunity to capitalise on this and should work towards being seen as a centre of excellence in such social media initiatives.

4iP is an investment fund for SMEs who wish to create digital services:

“what is mainly being commissioned is not content in any conventional sense but tools and content that enable the public to do things online which at present they are not able to do. 4IP isn’t a digital production studio so much as a digital machine tool factory – helping equip Britain with tools for 21st century living.” (Andy Duncan, Chief Exec, Channel 4 in speech to Nesta)

In the West Midlands we have a ring-fenced budget of £10 million for 4iP projects which represents a real opportunity for SMEs to meet the PSB agenda, grow their companies and innovate around emerging digital technologies.

Ofcom’s PSB review and the recent Digital Britain reported both discuss the importance of quality content, PSB and the role of online services. When one looks at this in combination with local and national government’s attempt to transform public services it is clear that the scale of opportunities available to digital SMEs is significant but that effective public/private partnerships are necessary to ensure the opportunities are not lost.

“We will promote innovation in online public services to respond to changing expectations. The Government will seek to build on the early success of innovate.direct.gov.uk by building such innovation into the culture of public services and public sector websites.” (from http://powerofinformation.wordpress.com/)

Freeing up data sources is one area in which innovation can be promoted in public services. Data exists at the local as well as the national level and pilot programmes in this area have already produced innovations such as the Show us a Better Way website (www.showusabetterway.com/).

The recently formed ‘Power of Birmingham’ group is an attempt to bring together public servants and civic-minded social media activists to react to this agenda. The group is attempting to identify funds to develop initiatives that show best practice. A pilot project with funding from Communities and Local Government department is to start in April/May with the intention of setting up a space for technologists to work with third sector organisations to create new content and services with local data.

The creation of such ‘hack spaces’ has been seen to work effectively in other regions. Higher education can play a key role here in offering space and incubating ideas and companies. Upgrading the region’s digital infrastructure and the creation of ‘digital districts’ could also contribute to the success of such spaces.

The shift in public services is happening at a significant level within Birmingham City council with the Business Transformation programme. This hopes to make savings of more than a £1billion over 10 years through innovations in service delivery underpinned by digital technologies. Areas such as agile working are a key focus and there is much space here for connections to be made between those managing Transformation, the knowledge base and innovating SMEs in the region. Given the length of the full Transformation programme Science City could play a key role in developing demonstrator projects ICT that bring these partners together.

Also, given the important role that procurement can play in the current economic climate, both in supporting the small to medium business sector, and to act as a catalyst for innovation, there is a real opportunity for Birmingham City Council to innovate in this area. Digital technologies can play a role in facilitating communication between procurement and the wider business sector, which will, in turn, encourage the take-up of digital technologies by businesses themselves.

Likewise, technologies themselves don’t create institutions. The development of celluloid film in 1888 didn’t create cinema exhibition as we now know it but it did meet a growing demand for entertainment that had only been partly met by other means. Investment in film technology (both in production and distribution technologies) then helped support the development of networks of cinemas but that outcome wasn’t inevitable from the initial invention of cinema alone.

The division between technology and creative companies in cinema (for example, Kodak as a producer of celluloid film and United Artists as producers of content) existed for much of the life of the medium and is only just merging now with those studios who produce animation also innovating around the production (3d animation software) and exhibition (3d projection) technologies.

Like cinema, digital technologies have the potential to create totally new kinds of patterns of work and leisure. However, at this point in time we don’t fully understand what those will be, in the same way we can only see with hindsight the impact that transport technologies had on shaping physical spaces in cities.

What is emerging is that there is little division between technology and creative firms in the digital sector. Design agencies employ designers who are already familiar with how digital technologies work. This merging of the creative and technology sector is happening much more rapidly than in other mediums and needs to be more fully recognised at a regional level. The business cluster programme at Advantage West Midlands still has separate groups for ICT and for ‘Screen, Image, Sound’. Content is seemingly separated out from the technologies that underpin it.

Understanding users is key to developing digital products that have the potential to be commercially successful for regional businesses. Many commentators argue that we’re witnessing a significant period of change in how users consume media and incorporate technology into their everyday lives. The notion of ‘Cognitive Surplus’ as identified by Clay Shirky is a useful term to understand how the shift from linear media forms (such as television), to more interactive forms (such as wikis and blogs) creates a user-need for new services. These new services should engage users as contributors and producers rather than just recipients of information. LUCID’s varied approach to user-engagement took this on board for some of the demonstrators (such as the QR trail game) but others utilised the technology to push content without any engagement from the user side.

The demonstrators were:

• FIZ GPS Trails – Digital Birmingham developed a variety of rich media content specific to audience types – the info. Would be pushed out relevant to location.
• Urban Pie/383 Project.com – promoting customer information via a mobile page pushed from a sales point using Bluetooth
• QRcode trail – an exploration of the use of QR codes in a treasure hunt around Digbeth.
• NEC Bluetooth ads – An application to push time specific adverts via Bluetooth
• RFID nav – An investigation into the use of RFID for indoor navigation.
• Digital Messageboard – An application to gather user feedback about a specific location and present it back to them in a variety of ways
• Maphead – A geo-socialising application enabling users to explore points of interest and find other users in their immediate vicinity.
• Mobile quiz application – A location-specific numeracy learning game.

This report is one of the outputs from LUCID and aims to look at the strategic framework within which the activities within LUCID took place and suggest ways in which a digital strategy for the West Midlands can be developed to take into account some of the lessons learned.

It will also suggest a framework for identifying future digital opportunities and suggest sectors which are likely to be catalysts for the wider use of digital technologies in society. It should be noted though that as computing technologies become increasingly pervasive almost every industrial sector has a need to understand digital solutions to business problems and research and develop future technology uses.

The report’s recommendations are for consideration by Advantage West Midlands Science City management group and the ICT and Screen Image Sound business cluster groups.

The report prioritises this position over one that would seek to second guess which technologies will or won’t work. It highlights the role of the public sector in promoting innovation through recent shifts in perceptions about the delivery of both public service broadcasting and public sector services – these are the areas in which digital innovation can flourish.

In avoiding a technologically determinist approach, that is, one in which the technology itself is seen as the only driver of change, the region can instead focus on creating the right conditions for innovation to flourish. Those conditions include:

• Support further demonstrator projects in the use of digital technologies but with a focus on supporting the digital transformation of public services.
• Promoting Birmingham and the West Midlands as a centre of excellence in partnership working to support the digital transformation of public services.
• Supporting the development of a co-working spaces or ‘hack labs’ where new services can be developed and users can interact with technologists.
• Supporting developments to the digital infrastructure, including bringing high-speed fibre networks to specific ‘digital districts’
• Examine the strategic organisation of the cluster programme at Advantage West Midlands to better reflect the meshing of creativity and technology that happens in industry.
• Investing in research into user interaction with digital technologies and promoting the dissemination of this knowledge to technology businesses.