Taken From Grass Roots

Building our Future -
Implementing the Manitoba Innovation Corridor

Solutions for the Next Century

A Note to the Reader

In an earlier document entitled "Securing Our Future A Manitoba Innovation Corridor: Solutions for the Next Century" several very important conclusions were reached. For Manitobans to be successful in the digital economy, we need to consider carefully and plan prudently for how we will establish ourselves. Our success is also dependent upon a unified effort among business, government, and education. As a catalyst for change, the document recommended that an Innovation Corridor be embarked upon as an important component of the new Manitoba digital economy.

In brief, the report recommended the following arrangements:

That an Innovation Corridor be created in which small to medium sized companies would come together in an inexpensive environment conducive to multi-faceted collaborative and creative arrangements.

That clusters of companies populate the "Corridor" and that an executive director oversee the corridor's operations and provide general strategic and marketing support.

That the Provincial Government articulate the realities and values of the digital economy in a manner that would get all segments of our economy sharing and leveraging resources.

That an "Innovation Council" be established to recommend and monitor the restructuring of our regional institutions.

See Attachment V for more detail.

This paper addresses two very important functions. First, it further elaborates on the need for a corridor by reviewing global trends and their implications on Manitoba. Second, the report begins the important process of placing the corridor concept into a tangible context by identifying locations, discussing costs, suggesting institutional arrangements and identifying technology requirements.

Contents

Executive Summary *

Preface *

Introduction *

Forces Shaping Economic Community *

Globalism *

Information Technology *

Political Devolution *

Changing Demographics *

Forces Change, New Leaders Emerge *

A New Economy is Growing *

New Forces Give Rise to the Civic Entrepreneur *

The Rise of Economic Communities *

The Importance of Clusters to the Economic Community *

The Development of Community Competencies *

Its Not What we Have, Its How we Use It *

Using What We Have Effectively *

Summary *

Lessons From Other Cities *

Montreal *

Centre de developpement des technologies de 'information (CDTI) *

Cite du multimedia. (CM) *

In Summary: *

Toronto *

SMART Toronto *

A Note on the SMART Toronto InfoTech Centre *

In Summary *

Edmonton *

There are 3 things that stand out in Edmonton's economic thrust *

The Unifying Force of a Well-Placed and Promoted Vision *

The University is a major player in Economic Development *

Edmonton has a very successful Economic Research Park and Incubation Centre *

In Summary *

Requirements of The Innovation Corridor *

Advantages of the Innovation Corridor *

Necessary Ingredients *

A District *

A Development Group *

An "Artist's Village" *

Critical Success Factors *

The Physical Space *

Example Buildings Suitable for the Corridor *

Building #4 *

Building #5 *

Building #6 *

Why Renovate? *

Tenants Like to Personalize Their Low Cost Buildings *

Renovation Challenges *

Summary *

Innovation Corridor Technology Components *

Internet Access *

Internet Access Recommendations *

Cost Estimates *

Cable Plant Costs *

Horizontal Building Wiring Plant: *

External Internet Feed *

Leased Line: (T1) *

Wireless: (11 Megabits) *

Video Conferencing and Projection Facilities *

LAN Servers, Web Servers, Video Servers *

Cable or Satellite TV Access *

MRnet Access *

View from the Cyber Community *

Lease Rates *

Shared Services *

Atmosphere *

Accessibility *

Infrastructure *

Marketing Services *

Remote Locations *

Summary and Recommendations *

Appendix I: The St. Paul's Experience *

Appendix II Artist's Village in the Exchange District *

THE IMPORTANCE OF HOUSING IN THE DOWNTOWN *

ARTIST'S VILLAGE IN THE EXCHANGE DISTRICT *

Public-Private Partnership: Joint Venture to Achieve a Public Goal *

Homesteading the Exchange District: Artists as Pioneers *

Current Provincial Government's Interest in Artists Village Development *

Component 1 - Housing/Studio Accommodation for Artists *

Component 2 - Artspace *

Component 3 - Art Making Demonstrations *

Component 4 - Outdoor Artist's Market and Village *

Component 5 - Commercial and Public Galleries *

Component 6 - Establishment of a Cultural Industries Export, Training and Events Coordination Storefront in Artspace *

Component 7 - Special Funding for the Promotion of Artist's Village as a Tourist Destination *

Outcomes *

MANAGING THE PROCESS *

Examples of Canadian Cities' Artist's Village Developments *

Edmonton *

Toronto *

Appendix III A Conceptual Menu of Services and Rentals for Tenants *

Appendix IV Online Questionnaire *

On-line Company Questionnaire *

Appendix V Securing our Future: A Manitoba Innovation Corridor *

Conclusion *

Recommendation *

Rationale *

Conclusion *

Recommendation *

Rationale *

Conclusion *

Recommendation *

Rationale *

Conclusion *

Recommendation *

Rationale *

In the late twentieth century, the forces of globalism, information technology, political devolution, and changing demographics are converging to spark civic entrepreneurship and increase the importance of the economic community. Fundamental economic, technological, demographic, and political shifts have pushed collaboration at the regional level to the center of a new paradigm.

Companies are searching worldwide for the best regional habitats for value-added activities creating unparalleled opportunities for local regions such as Manitoba to participate in growing global industries.

Together, these forces are decentralizing economic leadership from countries and provinces to regions and communities. Together, these forces create the need for new collaborative relationships at the regional level between the economy and community. Where talk was once of a competitive advantage of nations, now the language speaks of the collaborative advantage of regions.

The requirement now is for leaders who can inspire and empower people to solve problems and take advantage of opportunities at the community level. The task is no less than to rebuild civil society, both the institutions and the skill sets, from the bottom up. Joining the leadership ranks of industrialist philanthropist, charismatic elected officials and technocrats will be the civic entrepreneur leading the charge toward economic communities. These new entrepreneurs will become the leaders of their time.

Economic communities are places with strong, responsive relationships between the economy and community that provide companies and communities with sustained advantage and resiliency. They are populated by mediating people and organizations that help interests come together to deal constructively with forces of change. The Manitoba Innovation Network believes that communities that transform in this way will be in the midst of the action. Three distinguishing features mark an economic community:

Engaged clusters of specialization. Economic communities boast concentrations of firms that create wealth in regions through export and are engaged by their communities to meet mutual needs

Connected community competencies. Community assets and the processes that create competitive clusters and sustain a high quality of life are the competencies of the economic community.

Civic entrepreneurs. Economic communities are populated with entrepreneurs who link economy and community; leaders that connect economic clusters and community competencies to promote economic vitality and community quality of life.

In economic communities, success is the product of continuous collaboration across the traditional domains of economy and community. Businesses rely on the community's assets - specialized suppliers, skilled workers, information networks, and responsive government - for their competitive advantage. The community relies on businesses to invest in people and infrastructure and share responsibility for solving regional problems. Relationships forge links for continuous improvement and civic entrepreneurs to nurture these relationships for the betterment of the community.

The Manitoba Innovation Network embodies the concept of civic entrepreneurship. Drawing membership from business, government, education, and community sectors, MIN represents many segments of our society and many walks of life. Our Ourresources are in the community and our theircommitment are is to the community.

The Manitoba Innovation Network can be very helpful as Manitoba moves toward the economic community concept. The economic/community relationships built through MIN will prove invaluable as Manitoba confronts the challenges of the digital economy:

If Manitoba is to succeed in the digital economy it must create the arrangements that will allow it to compete. These structures are of a governance and physical nature. The governance aspects are addressed in Volume I of Securing Our Future: A Manitoba Innovation Corridor, Solutions for the Next Century. This volume is oriented almost exclusively to the physical environment in which the processes and actors, necessary for thriving in the digital economy, play their parts. Recommendations that arise specifically in this volume are:

Winnipeg's Exchange District should become the location for our Innovation Corridor for 3 main reasons:

As a National Historic Site designation it is both unique and can be profiled to Winnipeg and Manitoba's benefit in a manner no other city can emulate.

It's historic roots and turn of the century architecture can be adapted to create a funky, dynamic and wrap-around environment in a way that could make it most attractive to the young entrepreneurs that dot the internet landscape.

With a modest amount of expenditure it can be made to be the ideal, low-cost home for a hundred or so digitally based companies.

In implementing the Innovation Corridor recommendations and in establishing the various governance structures the Manitoba Innovation Network, with its proven record in building economic community-relationships and resilient linkages between community and economic interests, should be called upon to play a lead role.
An Economic Development Group with representatives from all three levels of government should be established to guide development.

This group would be responsible for the physical aspects of the corridor, as well as the mix of business, and a host of amenities.

Added to their responsibilities would be the functions of an Urban Development Bank and an information and marketing resource.

A "pot" of money should be devoted to "kick-start" the Corridor. Approximately $10 million would be sufficient to revamp a couple of buildings, to get the process going, and to allow participants to experience-rate the concept. Attempts to do the entire program under a single master plan should be resisted. The rule in dealing with the many inputs, players and possibilities that will be swirling around this venture is to proceed in an adaptive-sequential-decision-making mode.
The buildings should be well equipped technologically and costs to the companies that occupy them should be relatively low. Those costs should however represent enough of an out of pocket expense to indicate commitment.

Preface

The city of the next millennium will be a reinvented, reinvigorated triumph of civil will. Yesterday's oil well, steel plant, nickel mine will be replaced by the city as the primary economic engine of our time. This concept is not new. Others in the United States and Europe have for some time now recognized their cities as the key factors - the key factories - of the modern economy. They are frenetically fine-tuning the urban "attitude", celebrating the urban "space", bringing "awake" urban life.

To a degree not recognizable in Canada, the Europeans and Americans have acknowledged their cities as national resources.

The prosperity of these cities is increasingly dependent on what are called "key advanced processes" or "key activities". Concentrated in the world's cities, key activities such as finance and ancillary services such as legal and accounting, design, innovation, organization of production and marketing, tourism, artistic, creative and cultural activities provide the base for entirely new city economies.

All these functions are heavily clustered in the city's central areas, thus the economic health of the central area determines to an ever-greater degree the economic health of the surrounding region.

As labour becomes more specialized, the key-activity industries are tending to recruit their employees from greater distances resulting in profound effects on the city fabric. The lure for these employees is quality entertainment and cultural attractions, good schools, low crime, a clean environment and comparatively high-market retailing.

Cities with the ability to grow and develop in the digital economy focus on the information industry, finance, business services, knowledge technology and creative and cultural activities.

To be competitive Manitobans need to plan not by zoning and density and the thousands of pages of minutiae that have constituted official plans of the past, but by a human vision of the city. Winnipeg has the right and obligation to declare the nature of our city. Once we declare this idea of the city, then we can ask the private sector working in partnership with the public sector to build that vision.

Political leadership is the key issue in making all this happen. Planners can come up with concepts, but until someone communicates those concepts effectively, they remain paper ideas.

Business, banks, universities, colleges, Chambers of Commerce, federal and provincial governments and philanthropic foundations should be at the planning table in downtown redevelopment partnerships with our municipal government as they are in a score of major cities across North America and Europe.

By relaxing zoning restrictions and encouraging new uses for existing buildings in the Exchange District and cutting approval time for projects from years to weeks, the municipal government could set off a redevelopment mini-boom, particularly in the older section of the city.

Building an Economic Community for the Digital Economy

Collectively we must respond to the challenge of making Winnipeg an economic community typified by strong, responsive relationships between the economy and community that will provide companies and communities with a sustained advantage and resiliency. To do so we must integrate our economy, the world of work, with our community, and the world of living. The secret to our success will be an effective collaboration among business, government, education, and community leaders in addressing new challenges and opportunities.

Manitoba already has a group of alert, knowledgeable and community-minded citizens drawn from every element of Manitoba's institutional fabric. They have been brought together within the organizational structure of the Manitoba Innovation Network and are dedicated to making Winnipeg a city for the Digital Age. With the addition of enlightened political leadership we have the seeds of a great beginning.

Introduction

To be successful in the digital economy Manitoba must leverage its geographic position, entrepreneurial bent and any conduits that exist for information flows, goods and services flows, or financial flows. Just as successful companies develop and sustain core competencies, we must develop niches here that can sustain competitive advantage by investing in talent, technology, and specialized infrastructure. This will mean cultivating clusters of similar businesses as part of our region's milieu. At the same time, we must offer a quality of life that will attract and retain knowledge workers essential to high-value activities.

The keys to effectiveness are people and places policies. Although a few key people may be mobile, large numbers of our workforce are not. Policies that support the education and training of the workforce, that support research combined with education, that support a modern infrastructure, and that help develop institutional collaboration between business, government, and the independent sector will have lasting effects on building capacity that does not readily disperse.

In sum we need to develop the people and places - the habitat for living and working if we are to provide value-added jobs in the new economy

It is becoming common wisdom that globalization promotes regionalization. What is yet unclear is how well Manitoba will ultimately respond to this new reality. Manitoba is the last province in Canada to begin addressing this issue. We will either recognize and capture global opportunities or be cowed by global threats Those that succeed do so by placing a premium on crossing boundaries between government, education, and community to position their economic region as a global contributor.

Forces Shaping Economic Community

In the last two decades of the twentieth century, four forces are converging. These forces spark civic entrepreneurship and increase the importance of economic community. Fundamental economic, technological, demographic, and political shifts push collaboration at the regional level to the center of a new paradigm.

Globalism finds companies searching worldwide for the best regional habitats for value-added activities and creates unparalleled opportunities for local regions, such as Manitoba to participate in growing global industries.

Information technologies decentralize organizations and decision making of all types, which stimulates horizontal networking among companies in regions.

Political devolution shifts authority to local levels of government and also transfers responsibility from government to individuals, families, and other organizations in communities.

Changing demographics move baby boomers into decision-making positions as increasing diversity creates pressure and opportunity to open up community power structures.

Together, these forces are decentralizing economic leadership from countries and provinces to regions and communities like Winnipeg or Steinbach or Russell. Together, these forces create the need for new collaborative relationships at the regional level between the economy and community. Where talk was once of a competitive advantage of nations, now the language speaks of the collaborative advantage of regions.

Although the nation and states will always have key support roles, as the millennium approaches forces of change are making regions and their leaders the loci of action. Economic communities are figuring out how to thrive in a world shaped by these four forces.

Globalism

Globalization is the first of four key factors driving the creation of such economic communities.

Globalism means being both global and local at the same time, that is, serving global markets but being connected to every region where a company operates.

The old Globalism paradigm was based on the search for low-factor costs. In their initial forays into international business, companies searched worldwide for regions with low-cost land and labor to serve as export platforms to produce high-volume, commodity products for the rest of the world. Much of the investment during the 1980s in Southeast Asia and Mexico followed this model.

Suddenly, higher-cost Canadian regions found themselves poorly suited for manufacturing commodity products. For example, as a microcosm of urban industrial Canada, Montreal lost its competitive edge as a centre for commodity manufacturing.

Now, as globalization moves into more advanced stages, Manitoba must view this force not as a threat but as an opportunity. We must work hard to articulate and meet a new goal: to participate as a critical regional contributor to value-adding global industries.

We must get our competitive juices flowing. The future is upon us. We can either allow the future to happen around us, or we can capture our share and be part of the digital economy. If we choose the former approach over the latter, we risk becoming some kind of second-class economy in the next century.

This new Globalism finds companies searching worldwide for the best locations to host high-value, specialized, and innovation-related activities. Under this model, corporations invest in regions to gain access to specialized workforces, research and commercialization capacity, innovation networks, and unique business infrastructure. The focus is not just on lowering cost. Jack Welch, chairman of General Electric, described the way successful businesses will operate tomorrow.

"The winners in these global games will be those who can put together the world's best in design, manufacturing, research, execution, and marketing on the largest scale. Rarely are all of these elements located in one country or even on one continent"

Once companies invest, the goal increasingly becomes integration into the local culture. Under the old globalism, companies were footloose often fleeing once they discovered a lower-cost location. Now, it is recognized that healthy local roots are necessary to sustain global reach. Key drivers are access to local markets, workforce, technology, and suppliers

"To succeed globally, companies must be recognized as an asset to the local economy by providing good jobs exporting, adding value to the community and above all, keeping promises."

In other words, business strategy links global success to roots in multiple local habitats. The strong implication being that the New Globalism affords the economic community of Manitoba an opportunity to participate in exciting global industries and to partner, or even to host world-class companies.

We can do this by creating specialized habitats that can grow high-value business. The goal is to be able to contribute something unique and different to global industries. From a company's viewpoint, they envision a worldwide network of regions, each playing a different role in the value chain. Some regions will position themselves as R&D wellsprings, others as high-value, quick turnaround manufacturing centers for a particular industry or a collection of industries.

Manitoba could become an expert location for animation design, leveraging detail marketing information on the grain industry, a centre of transportation expertise, the supply side of agri-foods, and so on.

In sum, Manitoba must concentrate on creating its own niche within this global matrix.

Information Technology

Information technologies are changing the economy and society. The new economy is fast-paced and relationship-based. To become a leader in information technology we must define a new standard in community networking and in how we participate in the information age.

The digital revolution is continuously creating new, empowering tools for business, government, and the community. Coming in waves, information technologies first gave us access to computing power, then connected computing power to communications, and now are providing us with interactive multi media. The effect of these tools is flatter organizations, decentralized decision making, more smaller players, and more networking among organizations in regions.

The decentralizing power of this digital revolution makes regions and relationships between players within a region more and more important.

Used as a tool to propel the industrial age, the vertically integrated, centrally controlled organization is being radically transformed into more focused, decentralized, nimble business units. Just as mainframe computers gave way to networked, desktop computers, so too centralized decision making is now giving way to decentralized decision-making, removed from the command of headquarters. This change is driven by the competitive need to be faster, better, and closer to customers and is enabled by information technologies. Companies and people now operate in many different places under a corporate or team umbrella; individuals operate with more autonomy than ever before.

As big companies decentralize, small company competitors and potential collaborators also proliferate. The new technology networks enable small companies to overcome the main advantages of large companies - economies of scale and access to resources. At the same time, these smaller companies are not burdened with the main disadvantages of large firms--deadening bureaucracy, stifling hierarchy and the inability to change. These smaller kinds of companies are growing in communities across Canada.

A competitive stance in this fast-paced, high-value market requires quality, speed, and innovation. Companies of all sizes are specializing in what they do best and contracting out or managing relationships to handle the rest. Companies focus on their core competencies and then look outside their corporate walls for the relationships and resources to help them compete.

Traditional patterns of vertical integration to achieve economies of scale are giving way to new horizontal networks and alliances designed to achieve economies of scope.

The duo of decentralization and specialization is giving rise to the networked economy. The shift is from the individual firm as the business unit to networks of firms and other support players. Concentrations of people, companies, and organizations in a supportive habitat are creating wealth together

The information age is spawning a new business model based on decentralization and specialization in regions. Taken together, these forces point to regions as centres of action and opportunity. The challenge for regions is to create habitats where fast moving, innovation-based, networked companies can flourish.

Political Devolution

The era of big government is over. The ability of federal and provincial governments to solve our problems is limited. A fundamental rethinking of the role of government in our lives is sparking downsizing of government bureaucracy, privatization of public services, and budget cutting. The current wave of devolution raises the question: Who will take responsibility for dealing with the challenges that the governments will no longer address?

The emergence of a postindustrial; knowledge-based global economy has undermined old realities throughout the world. Decentralization of government mirrors the decentralization of the new economy. Just as information technologies and global competition have flattened hierarchies in the corporate world and forced businesses to become more flexible and productive, government is adopting a more nimble, focused organization model as well. The hope is that more decentralized government institutions will deliver more limited but responsive services that keep pace with changing local needs.

Devolution means two things to Manitoba. First, governments will decentralize, shifting authority down to the municipal levels. Second, governments at all levels will exit some arenas entirely, shifting responsibility to individuals, families, and other organizations. In both cases, the force of devolution clearly increases the importance of economic communities.

The various governments, in fact, are no longer in a position to make major investments in regional infrastructure or industries. As the public sector shrinks and decentralizes and the private sector goes global, a major challenge for communities becomes managing the spaces left. The third sector or civil sector is the arena of voluntary associations and networks that stands between the world of markets and business and the domain of government and politics. In this arena, voluntary relationships benefiting the long-term shared interests of business, government, and other community sectors can form.

Consensus is growing that civil society is the next frontier, as Canadians attempt to deal with continuous refocusing of their private and public sectors. It is to this arena where multiple sectors can work together, that communities will increasingly turn.

This resurgence of interest stems not just from the third sector's ability to serve traditional social needs as government backs away. The resurgence stems equally from its potential to serve as a critical intermediary linking long-term goals predicated on the coercive power of the state. The free market is money-based, commercial and built on the interest of consumers and producers. The false dichotomy of government and business ignores the crucial realm of human activity - voluntary relationships. The third sector encompasses relationships that are voluntary but not for commercial gain such as associations and community groups.

Devolution will continue to push responsibility and accountability down to communities. This push is launching provincial and municipal governments into an era of continuous restructuring and innovation similar to that experienced by the private sector. The result will be a government and social structure that more closely mirrors decentralizing business structures. Devolution heightens the need to build economic communities; places marked by strong collaborative relationships between economy and community that play themselves out through an active civil sector.

Changing Demographics

In communities across Canada, the locus of leadership is shifting from the hands of primarily male, primarily white, leaders of the post World War II era to the hands of the much more diverse baby boomers. Every Province in Canada, including Manitoba, can point to a small group of influential businessmen and politicians who made the decisions and deals that shaped their communities. They worked wisely and sometimes selflessly to advance what they perceived to be the best interests of the community. Many left considerable legacies.

Along the way, a new generation has come of age in a world that looks quite different, and they operate quite differently. Many have had to learn to operate in ever changing network relationships as opposed to a stable, hierarchical world. In this New World, women and minorities became active in business and community affairs. In this world, a host of new interests and organizations developed mature voices and influence. In the early 1990s these worlds existed in parallel. The good old boys retained a degree of power and influence, yet their traditional, unilateral style prevented them from dealing with the complexity of the new problems and players. New power groups flexed their muscle and learned how to stop the initiatives they disagreed with, but they lacked the ability to advance the community forward.

In Manitoba this situation has resulted in change as more people affected by public policy decisions have a say in the outcome. But the situation has also made visionary leadership more difficult. Many empowered interests can say "No". No one group or organization has the authority to say "yes" and in so doing override other interests and act unilaterally. There is no prevailing hierarchy; seemingly no locus or centre for appeal. The result is public policy 'gridlock' and an unfilled need for leadership capable of effective action in the broad interest of the community.

In some communities, boomers have emerged to fill this void with a new, more collaborative style of leadership. From business, politics, education, and the community, new leaders are starting to fill the void left by the old order, often by joining the best of the new with the best of the old. Whereas the older generation focuses on unilaterally advancing their idea, these collaborative leaders manage consensus-building processes. Their position in the community stems from their ability to build trust and bring together participation among a broad cross-section of peers rather than to impose hierarchical authority or heavy-handed power.

Only if we open up our current system of decision-making are we going to be able to see opportunities and move forward. We need to work to bring along a whole new bevy of leaders, people who are familiar with the rudimentary tools of electronic collaboration such as e-mail, PowerPoint, Word, Lotus, etc.

We can view shifting demographics, like globalization and information technologies, as a problem or an opportunity. What is inevitable is that demographic shifts will place a premium on collaboration and new leadership at the level of economic community.

If we can tap diverse talents and unleash a new generation of leaders we will have a leg up.

Forces Change, New Leaders Emerge

A New Economy is Growing

Dramatic related shifts in all four arenas - economics, technology, government, and demographics - are shaping a fundamentally different kind of environment from the one that dominated Canada and Manitoba during much of the twentieth century. A worldwide economy, rooted in communities like Manitoba, is superseding a national economy dominated by national industries. Industrial technology and vertically integrated mass production are giving way to information technology and specialized production networks. Older leaders struggle to remain relevant to boomers and increasingly diverse up-and-comers. And devolution tears at the big national government of the past and calls for renewed initiative at the community level.

Manitoba is in the middle of a major transition.

The rise of the national economy dominated by vast corporations and checked by big government diminished the autonomy of local communities and undermined citizen initiative. There was little room for civic initiative in a world where communities looked to national government to solve national problems and where informed deliberation was the domain of expert brain trusts. In fact, the best and the brightest of the 1960s saw local communities and ordinary citizens as provincial and backward at best and at the worst, parochial and bigoted. Focusing on economies of scale, experts, and national primacy, community became synonymous with nation.

New Forces Give Rise to the Civic Entrepreneur

The result of the four changing influences described above are dramatic. We have shifted to a world of accelerating, never-ending change without the mechanisms for people to work together to deliberate about the changed environment and determine their collective fate.

Signs are everywhere that the old model, which focused on massification, experts, and business-government antagonism, simply does not work for the new environment. The answer for Manitoba lies not in replacing old governmental policies, programs, and institutions with new ones. Nor does the answer lie in the wholesale dismantling of government and nation and returning to the agrarian village.

Rather, the answer lies with the "early adopter" communities across Canada who by necessity are shaping an entirely new business-government-community model for the future. Out of their experimentation and success will emerge the new model for the twenty-first century. What has become clear is that the changed environment creates a fundamentally different kind of relationship between regional economies and communities, and it requires fundamentally new leadership.

The requirement now is for leaders who can inspire and empower people to solve problems and take advantage of opportunities at the community level. The task is no less than to rebuild civil society, both the institutions and the skill sets, from the bottom up. Joining the leadership ranks of industrialist philanthropist, charismatic elected official and technocrat will be the civic entrepreneur. They will become the new leaders of their time.

The Rise of Economic Communities

The communities that are arising amidst all these changes can truly be called "economic communities".

Engaged clusters of specialization. Economic communities boast concentrations of firms that create wealth in regions through export and are engaged by their communities to meet mutual needs.

Connected community competencies. Community assets and the processes that create competitive clusters and sustain a high quality of life are the competencies of the economic community.

Civic entrepreneurs. Economic communities are populated with entrepreneurs who link economy and community; leaders that connect economic clusters and community competencies to promote economic vitality and community quality of life.

In economic communities, success is the product of continuous collaboration across the traditional domains of economy and community. Businesses rely on the community's assets - specialized suppliers, skilled workers, information networks, and responsive government - for their competitive advantage. The community relies on businesses to invest in people and infrastructure and share responsibility for solving regional problems. Relationships forge links for continuous improvement and civic entrepreneurs nurture these relationships for the betterment of the community.

The Importance of Clusters to the Economic Community

In many traditional communities, competencies tend to be dominated by supply-side rather than demand-side considerations. Governments and educators create programs to provide services to business without a clear understanding of industry needs. Networks of providers talk mainly among themselves. Programs grow over time becoming further and further removed from industry demand, creating costly bureaucracies that seek to perpetuate themselves. Communities as well may take unintentional steps that are detrimental to the industry clusters of their regions because of a lack of communication. In economic communities, on the other hand, companies actively engage in articulating their needs and work with the community to meet those needs.

Typifying an economic community are several clusters of specialization. Industry clusters are concentrations of competing, complementary, and interdependent firms and industries that create wealth in regions through export. Clusters will be important for Manitoba because they drive the vitality of support and local-serving industries. Clusters have:

Access to specialized workforces. Companies in clusters can draw on large markets of people with specialized skills and experience working for related firms.

Access to specialized suppliers. Companies in clusters have access to concentrations of specialized suppliers of inputs and services.

Access to networks. Companies in clusters have access to information flows and technological spillovers that speed innovation.

Access to specialized resources. A region with industry clusters can be a distinctive habitat because of the quality of its specialized resources and the ease by which those resources can be obtained.

Some of these needs will be common across all clusters; others will be specific to a single cluster. In Tucson, small and growing optics companies work with the University of Arizona and the Greater Tucson Economic Council to fund joint industry-university research and endow professorships for optics programs. Organized as the Arizona Optics Initiative, the cluster provides banks with technical help to improve their understanding of optics companies. Companies work with local K-12 and community college schools to prepare a pool of skilled optics technicians.

The distinguishing feature of economic communities is not just that they have clusters but that they have mechanisms to engage their clusters in the life of the community. Economic communities foster communication between the private sector "demand" and the government and community "supply". For example, in an economic community, a school district might meet every month with industry representatives and have their teachers and administrators talk about specific skills goals as well as methods for preparing kids for lifelong learning.

Economic communities view clusters as important customers. Just as companies increasingly ask customers to participate in interactive product development processes, so economic communities expect companies to engage in articulating and helping to meet their support needs.

Economic communities understand the shift in thinking necessary to support a globally competitive, knowledge-based economy. The game used to be to provide a low-cost environment, including cheap and abundant labor. This effort made sense when the goal was a natural-resource-based or commodity manufacturing economy. Now, to foster the kind of economic activity that will sustain higher standards of living, Manitoba needs to create an environment that fosters speed, relationships, innovation, productivity and global linkages, all while managing costs. It is not just a matter of eliminating the negatives but more importantly of creating the value-adding positives.

Economic communities are rife with activity between the economy and the community. Economic networks and community networks bump up against each other and integrate. People from one sphere know and work with people from the other. People move back and forth between the two sectors, some more literally than others.

These relationships are the glue of strong economic communities. They link industry clusters with community competencies, creating a vital cycle in which community processes support the growth of the economy, and the economy creates the wealth and experience that is invested in the community

In economic communities, through ongoing interaction and working together, people come to know, trust, and like each other. They like to do things together. There are a lot of cities where that is not true. People may know each other, but they don't like each other or they let competition get in the way of working for the city. In contrast, the economic community gets a reputation as a well-oiled team that can be counted upon for support. There exists a dense network of trusting relationships that extend across its public and private sectors. Over time, a really good economic community will evolve into a very trusting civic environment.

Strong relationships across sectors provide regions with the ability to respond to negative external shocks and to work pro actively on opportunities. In effect, the web of personal networks in economic communities acts as a virtual system of governance. Distinct from government, governance in these communities means people, firms, and institutions working across sectoral, organizational, and jurisdictional boundaries to anticipate and meet the needs of their economy.

The Development of Community Competencies

Economic communities develop a set of community competencies that are responsive to business needs. Every community has a core set of processes that, for better or worse, affect its economy. Government drives some of these processes, processes such as K-12 education. Other processes, such as business financing, are driven primarily by the private sector. In economic communities, these processes are "attractors" because they are well linked to economic networks. Some key community processes for the new economy are:

Workforce education - including basic K-12 preparation, advanced preparation, renewal and retraining

Technology innovation - including research, information flows and technology dissemination

Business creation - including early-stage financing, entrepreneur support, culture and attitudes

Global trade - including specialized facilities and intermediary organizations, international networks, and diversity

Physical infrastructure and planning - including transportation infrastructure, advanced communications, facilities development, and housing

Regulation and taxation - including time-sensitive regulation, balance between taxation costs and value delivered

Quality of life - including recreation, culture, and downtown neighborhoods

Its Not What we Have, Its How we Use It

To date, the implicit assumption in the doing of economic development and in the writing about it has been that success comes from combining a familiar list of high-tech ingredients.

"The secret, this thinking goes, is to combine a familiar list of resources: a research university an industrial park, venture capital, public support for new technologies, and a desirable social environment. The assumption is that once these prerequisites are assembled, innovation and economic success will follow"

Economic communities, however, have discovered that how they use what they have is more important than just what they have.

"Creating a dynamic high-tech region is not a matter of combining ingredients. It is one of building institutions and relationships-both locally and nationally that support the development of innovative enterprises.... It is these relationships between the individuals, firms, institutions in the region that matter-not their simple presence"

The important part is not just the ingredients; the important part is the recipe for how the ingredients fit together. Economic communities have responsive processes that leverage their assets to serve the economy.

"....the important part is not the ingredients-what they have or do not have. The important part is how communities leverage their community assets, processes, and relationships to support the changing needs of their economy."

These economic communities are places that collaborate in order to compete globally.

Universities, for example, are often upheld as important for regional development. Yet the presence of a university does not guarantee an innovative economy nearby. It is not just the existence of advanced degree-granting institutions that builds an effective economic community. Rather, companies are impressed by colleges and universities that express a willingness to provide an extra level of services to industry. These could take the form of making adjunct professorships available to the company's technical people or a willingness to provide specially designed course work and library services to the industry's personnel.

The University of Texas at Austin is one of the best examples of a world-class university that has shaped key competencies around the direction of the regional economy. Locally landed endowed chairs ensure high-quality research and fresh supplies of graduates and students. Since 1983, the university has taken an increasingly strong initiative in recruiting national research consortia, redefining its research parks, commercializing technology, and participating in Austin's regional development efforts

Economic communities know that quality of life has moved from the wings to center stage as a condition for value-adding industries. Companies depend on highly skilled people, many of whom have multiple options about where to live and for whom to work. Economies based on the skills, experience, and creativity of people view quality of life as an economic asset.

Even traditional business-climate factors like regulation are viewed by economic communities as potential assets. Time-based competition means that product life cycles are now measured in months. The adage "time is money" has become "time is market."

Using What We Have Effectively

The Manitoba Innovation Network embodies the civic entrepreneurship discussed above. Drawing our membership from business, government, education, and community sectors, MIN represents many segments of our society and many walks of life. We are networked and talented. Our resources are in the community and our commitment is to get the facts on the table and out to the public.

The Manitoba Innovation Network can be very helpful as Manitoba goes through the change process. We have built economic community-relationships and resilient linkages between community and economic interests. MIN is characterized by 5 traits that will prove invaluable as Manitoba confronts the challenges of the digital economy:

We see opportunity in the new economy.

As civic entrepreneurs we understand the new economic realities and are compelled to act on an optimistic vision of how our community can be successful in the world of the next century. We believe that the new economy---global, complex, and fast changing--- can provide unprecedented opportunity for people, places, and organizations.

Collectively we possess an entrepreneurial drive.

Our drive is entrepreneurial. We take Manitoba's economy, its opportunities and needs as a starting point and provide our collective insight to use new ideas, practice a new style, and get results in our new digital economy.

We are providing a collaborative leadership to connect the economy and the community.

We bring the many faces of our community together in order to move forward. This massive undertaking cannot be accomplished, or even sparked, by a single individual. Only by combining our skills, personalities, and connections and by bringing in new leaders have civic entrepreneurs proved effective.

We are motivated by broad, enlightened, long-term interests.

The business leaders on our sponsorship panel are looking to the long term interests of the community. As citizens of Manitoba they are looking to create a long-term stake in the Province and to help create an environment in which their children can grow, seek meaningful jobs and become citizens of the world. Eschewing narrow self-interest, these people are anxious to cooperate with community, education, and government leaders to develop the constituents of the digital economy.

We work in teams, playing complementary roles

Civic leadership is a team sport. Though the myth of the tin tinkerer in a garage still prevails, business entrepreneurs are seldom loners. Rather, business entrepreneurs must work with an extensive network of collaborators to bring an idea to the market. In a similar way, civic entrepreneurs work in teams. The days of Carnegie-type individuals single-handedly coming to the rescue of their communities are gone.

Summary

We all live in communities, whether we notice them or not. Community surrounds us like water surrounds fish. As business people, we rely on the community for the talent, resources, and suppliers that we need to succeed. As citizens, we need community to provide the quality of life, the education, and the environment that keep us healthy and happy.

Yet new waves of forces are constantly transforming communities. Global competition, continuous industry restructuring, government cutbacks, and growing diversity are forces large and fundamental enough to knock people, companies, and communities off course. How do communities respond to the forces of change? How well do communities meet the ever-changing needs of their citizens and businesses?

As Manitoba struggles to advance in a time of rapid change, we are experimenting with new ways for the public and private sectors of our economy to create jobs and wealth. We are doing nothing less than redefining a new type of business-government relationship, a new type of community, an economic community.

The Manitoba Innovation Network, a group of committed civic entrepreneurs, is enabling Manitoba's drive toward an economic community.

Lessons From Other Cities

While the Manitoba Innovation Network believes that we are ahead of other jurisdictions in terms of the visions, concepts and governance structures laid out in this and Volume I of the Innovation Corridor study we are several years behind in practice. With this in mind we visited with people in 3 cities---Edmonton, Toronto and Montreal to benefit from any insights that they might have.

Montreal

Montreal have placed a lot of attention on its high-tech potential. Within the Urban area there are 7 high-tech parks. A recent KPMG study Montreal ranks Number one in North America for the density of High Tech jobs per capita.

To position Quebec favourably in the I.T. New Media fields, the government has set up Centres de development des technologies de 'information (CDTI*) and the Cite du multimedia (CM). These initiatives are designed to encourage investment by local and foreign companies in emerging sectors of activity, such as multimedia, the information highway and telecommunications.

Another objective of CDTI and the CM is to create jobs for young people by enabling them to enter the labour market more quickly while at the same time developing a pool of labour in sectors with a bright future.

Centre de developpement des technologies de 'information (CDTI)

The concept here is to bring together, in the same building, companies operating in the information and communications technologies field that want to work on an innovative project that includes:

significant economic spin-offs for Quebec;
substantial research and development likely to develop new expertise.

There are several of these buildings scattered in the major cities in Quebec. These buildings have had their infrastructures adapted to the needs of high-technology companies. The Montreal CDTI, which is at the heart of a district where many information technology industry leaders are located, offers infrastructures that have been specially adapted to the needs of companies that want to penetrate the North American market.

Cite du multimedia. (CM)

This concept was announced in June of 1998.

It differs from CDTI in that it represents an area of buildings rather than just one building.

Located in the Faubourg des Re colets district, near Montreal's Old Port, the Cite' du multimedia offers premises, tax advantages and a market which makes it a leading business opportunity in North America.

The Cite du Multimedia is a quadrilateral formed by de Ia Commune, Duke, William and King streets. Within this zone, tax benefits are available, according to certain criteria, for companies that move into buildings designated by the Minister of Finance of Quebec.

The following are attributes of both the Montreal CDTI and CM. They are:

close to Montreal's business district;

next door to historic Old Montreal with its restaurants and services;

close to the St. Lawrence River and its bicycle paths;

near industry leaders like Discreet Logic, Quebecor Multimedia and Softimage and others representing more than 400 jobs in this industry.

The CM buildings are designed with the following in mind:

total floor space of close to 10 000 sq. m. (100000 sq. ft.);

industrial heritage architecture;

work space with views on downtown and the Old Port;

the highest standards of comfort and ambient air control;

secure access control using the latest technologies;

access to commercial telecommunications networks;

minimum network capacity of 100 MbslMhx, structured cable network;

exterior platform for antennae;

passenger and freight elevators;

offices modified to particular company needs with indoor and outdoor parking.

Occupancy details:

ready for occupancy beginning in the summer 1998;

premises available starting from 100 sq. m. (1 000 sq. ft.);

allowance of C$1 60.00 per sq. m. (C$1 5 per sq. ft.) for leasehold improvements;

gross annual rent (all inclusive) from C$13.25 per sq. ft.;

rent includes all common building expenditures; flexible lease term.

Major tax benefits

an exemption from the tax on capitol;

an exemption from employer contributions to the Health Services Fund (HSF);

a refundable tax credit on wages paid to eligible employees;

a refundable tax credit on the cost of acquiring or using eligible specialized equipment.

In addition, a foreign training instructor employed by the company can, for a period of two years, claim a tax exemption on income from such employment.

a five-year tax holiday including;

an exemption from income tax;

In Summary:

Montreal moved some time ago to a concept not unlike our Innovation Corridor. The one main exception is that they have fueled their expectations with substantial funding. Projected by some to be in the order of $400 million.

Toronto

Unlike many other cities and towns in Canada and the United States Toronto has not felt the need to have a sharply focused municipal approach to the digital economy. This is because they feel that with more IT and New Media companies than any other city in Canada---including Ottawa and Montreal---the market place is adequately fulfilling their needs. The single most important coordinating agency for the digital economy in Toronto is a private sector group called SMART Toronto.

SMART Toronto

This is a collaborativenot-for-profit business organization whose goal it is to work with their members in helping the Greater Toronto Area to remain prosperous in the digital Age. In doing this they build networks, human and digital, to promote their region's strengths in advanced technologies. As their vision states:

We believe that, in the emerging information economy, advanced communications applications and services have the potential to deliver significant social, economic and cultural benefits. But these benefits cannot be achieved unless communities find ways to encourage people from various sectors and industries to work together. Networked organizations are fundamental to success in the Information Age.

The initiative for creating SMART Toronto was a concern that Greater Toronto had been falling behind other communities in working together to build the necessary high-speed communications infrastructure and promote the region's strengths. In early 1994, a group of leaders from business, government and social institutions gathered to provide funding to develop a mission statement and goals for the new, collaborative organization.

Some of their initiatives have been:

Working to establish an integrated, high-bandwidth community network for the GTA.

Promoting the Toronto area's capacities in film and post production work.

Providing a year around showcase for advanced products and services from the GTA via the InfoTech Centre

Contributing meeting space and the organizational means for networking. By so doing they give their member organizations opportunities to achieve new knowledge and create new partnerships to better exploit high-speed communications within their region and with the rest of the world.

Creating Access for Success, Toronto's first online community for job seekers. This project brings together community organizations involved in providing employment and training services to Toronto residents by providing them with the technical platform to deliver their services online. This initiative is sponsored by Human Resources Development Canada (HRDC).

Developing an International Marketing Package for the technology sector. The package, is designed to analyze and profile the Greater Toronto Area's IT sector to support efforts to attract investment to the GTA.

Building a so-called Liberty Village in a 4,000 square feet space in The Toronto Carpet Factory in an area of town once home to Toronto's smoke- stack industries. In the words of their publicity release: "It will be a place to learn, exchange ideas, gather information, and celebrate the accomplishments and the potential of the digital media industries---one of the city's most powerful new economic engines."

A Note on the SMART Toronto InfoTech Centre

This is a unique business place for members. It attempts to emulate a town hall for technology, where people and organizations can work together in building the economic future for the Greater Toronto Area.

It provides a showcase for innovative products, services and collaborative projects. It is a networking and marketing hub, and a centre for the development and use of advanced communications technologies. It is dubbed a critical part of Toronto's infrastructure in the Information Age.

The InfoTech Centre is located within the Metropolitan Toronto Reference Library at 789 Yonge Street just north of Bloor Street. It offers exhibit space, and seminar and meeting rooms equipped for videoconferencing. SMART Toronto members use the Centre for such purposes as product launches, collaborative meetings and training sessions.

Workstations are available in the Centre for applications development and testing using high-bandwidth telecommunications lines. The Centre is designed to provide access, for organizations of any size, to the National Test Network operated by CANARIE Inc. Pre-commercial research projects that have received CANARIE approval are undertaken from the Centre, which is the only access point in the GTA available for such projects.

Ultimately, the InfoTech Centre is intended to be the first point of access to a high-speed research and development network that will extend throughout the Greater Toronto Area, accessible to large and small organizations alike.

Many organizations in both the private and public sectors have contributed resources to make the InfoTech Centre possible. A major partner in the venture is the Metro Reference Library, the largest public library in Ontario and Canada's only public research and reference library.

In Summary

Toronto' view of the unfolding of the digital economy is similar to our own but different conditions have given rise to different solutions.

We can learn from and should emulate such things as Toronto's Info-Tech Centre, its International Marketing database and its Access for Success.

Edmonton

Edmonton is an excellent example of a city that has aligned its economic development strategy to be consistent with successfully tapping into the creative dimensions of the digital economy. In the first instance Economic Development Edmonton (EDE) has an overarching vision to be a Smart City. Within this vision it has built six areas of strategic focus to strengthen Edmonton's long-term economic competitiveness on the eve of the new millennium. Among the six strategies the one given primacy of place is the so-called 7/25 model:

EDE's model 7/25 is a blueprint to grow Edmonton's knowledge-based economy from the current 7% of GDP to 25% by 2010. Model 7/25 is conceived to ensure Edmonton remains Alberta's knowledge capital and one of Canada's most innovative smart cities.

There are 3 things that stand out in Edmonton's economic thrust

The Unifying Force of a Well-Placed and Promoted Vision

Time and again in the interviews people from the City, Province, and University attributed their co-ordinated behaviour to the focusing influence of the vision of a Smart Edmonton. They all believed it was necessary for survival and they wanted to have their efforts play a part in the successes for which they were striving.

The University is a major player in Economic Development

The University is a major driver for economic development and have taken the designation of Edmonton as a Smart City very seriously. They have been very aggressive in terms of technology transfer. U of A has the have highest number of spin-offs in North America---40-50 companies last year with most of them being in health sciences(bio-tech, bio-chemistry, pharmacy---).

The Province's role in all of this has been important. They, and particularly Science and Technology have a strategic plan in which they have done two important things: they have made it clear that every one-government, industry, academia and associations etc.-have to work together if the Province is to be successful and the Government, have put up the money to add 1000 student positions at U of A..

Part of U of A's strategy in playing a role in the Smart City was to partner with companies. Out of this approach the idea of the Teleus Learning Centre arose. This is a $12 million building meant to house the University's thrust into life-time learning via the Internet. Within the context the operating arm will be the Institute for Professional Development (IPD), which in some respects is a shadow university in itself.

IPD understand that the older ways of approaching education no longer apply and are determined to be among the world leaders in terms of delivering courses electronically. Strategic thinking is important. Strategic planning is out. The IPD believe that strategies emerge---they aren't there "until you connect the dots and you can't get there until you have enough dots to connect."

A lot of people at the University set on EDE's committees.

Edmonton has a very successful Economic Research Park and Incubation Centre

The University of Alberta, Northern Alberta Institute of Technology (NAIT), and the Alberta Research Council have established formal working relationships in advancing research and technology development.

Edmonton's Research Park extends over 320-acres and was established in 1980 to assist in the diversification of the economy. It currently has about 35 companies and over 1200 high-tech people.

The ERP offers an environment that encourages collaboration among industry, research and academe by its high quality facilities and amenities. A spirit of community among resident technology entrepreneurs and companies, national level research organizations and post-secondary educational institutions complements these.

Incubation Centre

This is located in the R&D park and is run by Economic Development Edmonton and the University, particularly their Industry Liaison Office. It has been in operation10 years and has had about 100 companies graduate in that time.

Some attributes:

Building won an award for design. Walls moveable.

Floor costs are about average. Will have lower rate for the first 6 months and then move up from there

For associates (those not in the building) they can have access to the building and boardrooms for $50/month and can attend seminars.

They have corporate sponsors, including a law firm who also have seminars on the services they offer

Built under government funding---tri-government---City manages under EDE

Rent covers the operating costs. Rents were lower to encourage entrepreneurs to come out of their garages

There are common areas: meeting rooms/cafeteria

A startup company has a hard time building a network. Even companies not in complex will come in and start to network.

Free publicity as newspapers often come looking for news on start-up companies.

In Summary

While Edmonton does not have a formal "corridor" type structure it has implemented several aspects of the corridor, which are important: an overarching vision; strategic goals, open co-operation with both the University and the Province and an incubation vehicle.

Implementing the Innovation Corridor

Every city striving for prominence must have some distinct economic reason for being. It should do something better than or as well as other places around the world and it should become known for doing so. The big international cities such as New York, London and Tokyo are the world's great international financial centres. Los Angeles is famous for its entertainment industry. Milan is a centre for design, manufacturing and fashion.

Profiled cities must have great visions. A great vision is not, of course, the whole story. We also have to listen to how a city wants to grow and develop. We must respect the preferences of private citizens and private actors. We need to appreciate that the state must not try to control all the variances that go into making a city. It is the energy, drive and creativity of the people that must be allowed to run free.

But what is essential is that private citizens, corporations and public officials all share the vision of what makes a city great. For a city to have stature it must learn from and respect its heritage, it must build on and favour its economic strengths, it must provide vibrant civic spaces, it must value great culture and educational institutions and it must prize architecture of the highest excellence.

Requirements of The Innovation Corridor

Advantages of the Innovation Corridor

The Innovation Corridor would offer many advantages:

Most importantly, the Innovation Corridor would create jobs connected with cyber space, and jobs with unlimited future;
The Corridor would use public/private partnership rather than have a heavy reliance on public subsidies;
The Corridor would maximize the leverage of public investment;
The Corridor's design would stress sensitive rehabilitation rather than massive scale urban renewal and strive for energy conservation and sustainability;
The Corridor would create affordable housing for all income groups while minimizing the displacement of people and businesses;
The Corridor would become a district where the arts may flourish, rather than diminish during the redevelopment process;
The Corridor would be a lively, colourful community, offering a high quality life-style and interesting and challenging jobs for our young people.

Necessary Ingredients

The "Innovation Corridor" requires three ingredients that can be considered sin qua non.

First we need an area in which the costs can be kept low.

Second we need to create a collaborative environment which the young and creative adopt as their own and supply with a particular life-style and culture.

Third we need to create a dynamic, unique and stimulating environment pulsing with an energy that can be used symbolically to portray Winnipeg as a driving force in the digital economy.

A District

A natural part of the City in which to grow an Innovation Corridor is the Exchange District for several very good reasons.

The Exchange District is on its way to becoming Winnipeg's hottest and trendiest residential market fulfilling a dream long held by city planners and downtown businesses. There are at least two condominium projects planned and another two groups are competing for the right to convert the former Ashdown hardware store on Main Street into a residential complex

In talking with the "Wired" entrepreneurs that already inhabit the Exchange District, they all love the funkiness of reincarnated historical buildings. They imagine rows of workstations along the exposed brick walls, and state-of-the-art video editing facilities between the large deep windowsills. Being happy workaholics, they want a "makeup area" in their work space, a kitchen and a shower for evening sleepovers and wooden stairways that wind upwards to a glass atrium and rooftop deck. Rather than the expensive, modern administrative tower they love the original wood and the open beams and pillars. The fact that this arrangement costs so much less is just a bonus!

The Exchange District with its inclusive atmosphere is an ideal place for a creative community of Net entrepreneurs. Internet service providers, interactive multimedia and web designers, online services, database publishers, graphic design firms and others will come together in the heart of Winnipeg.

In seeking a world-class image for Manitoba's and Winnipeg's thrust into the digital economy a make over of the Exchange District would assist in engendering an image of next century development.

The creative use of its historical roots and buildings is a setting that cannot be matched by any community anywhere in North America. It is unique!

With excellent planing the district could easily contain parks, educational facilities, artist colonies, discos, a mix of eating accommodations, funky loft-type apartments and hundreds of net-based businesses. It would become an ideal location to spur life long learning in a setting that would make it both easy and fun.

Properly done, costs could be reasonable and very competitive. The excitement and location would create a culture and an identity the envy of many.

By congregating downtown, we can create some of the same shared opportunities that New York or even Silicon Valley have capitalized on for some time. By having people in close proximity, we would enable community building impossible in a suburban environment where the distances are greater and the cohesiveness much less.

See Appendix I for a portrayal of St. Paul's experience with their Lowertown.

A Development Group

While the Innovation Corridor will be a community project developed through public/private partnerships of city government, provincial & federal agencies, a Development Group will be needed to oversee its implementation. This group would be responsible for the physical aspects of the corridor such as building selection and overall veneer and imaging as well as the mix of business, galleries, theatres and studios, eating and entertainment facilities, parks, children's play space, and other amenities that may take up residence in the corridor.

The Development Group would engage in three kinds of activities to carry out its mission:

Act as an urban development bank to help fill the gap in financing remaining after government's initial grant. The Development Group would provide front-end expenses, loans, & loan guarantees to a number of projects.
Function as a design centre to help the City develop a plan for the area, set design guidelines for various projects, and participate in the active design review process with developers.
Serve as an information and marketing office to potential investors and the interested public. The Development Group would provide a constant flow of informational sheets, brochures, video and showroom presentations. Most of all, the group would facilitate face to face dialogue with interested investors.

It will, in one body, be a financial dealmaker, design watchdog, preservation advocate and indefatigable promoter of the neighborhood.

Success in its execution will depend upon leveraged financing, attention to detail, imagination, patience and an organization. Colloquially the Development Group will have to watch the store.

An "Artist's Village"

The artist's village concept (See Appendix II, prepared by Elisabeth Sweatman of the City of Winnipeg's planning department for more details) has been successfully implemented and operated in many cities for several years. An artist's village involves a number of elements that support, promote and maintain artisans and crafts persons in the creating, teaching and marketing of their skills and products. Activities within an artist's village attract people to visit, to interact, to learn and to purchase products. A critical component of an artist's village is housing and artists-in-residence facilities.

Central components of an artist's village include:

community interaction; education, viewing artists at work

professional development and ongoing training

studios

exhibition & performance spaces

sales

exports

shared support amenities and services; e.g. kilns, fax, computers, production equipment

housing, artists-in-residence and visiting artists accommodations

Support and ancillary functions to an artist's village include:

performances

festivals

public art tours

street vendors

buskers

restaurants and bars

public transit connections with other attractions such as The Forks

promotion opportunities; e.g. gallery openings all on one night.

Integrating an "artist's village" in some form or anther is very important to the perceived success of the Innovation Corridor for several reasons:

It would add substantially to the youthful colour of the corridor and enhance its global networking possibilities and image.

Many artists and film makers move easily between the creative worlds of the Web-based community and their own traditional world. The world of the artist and the world of the "web master" are beginning to blur and progressively be indistinguishable from one another.

The artists will, by instinct and employment, add immeasurably to the quality of life by their designs, posters and joie de vivre to the vibrancy of the Corridor making of it a place to be, to live and to work.

Critical Success Factors

To fulfill the promise our "Corridor" would include tastefully and artfully designed recycled historic buildings. People will flock to them for their varieties of age and ethnic groups, offices, homes and jobs, urban parks, street art and entertainment.

There would be an ongoing dynamic between artist colonies and "cyber-practitioners". This creative combination of artists and computer software designers, working in the same neighborhood, and linked globally through extensive fibre optics and satellite up-links would attract Internet, new media and telecommunications industries companies. The total would be economically successful and an engine for Manitoba's growth.

With careful nourishing, our corridor could become a prime national model for merging historic preservation, successful design, economic rejuvenation and lively street life, even along streets once threatened with abandonment.

The Physical Space

There are many older buildings in the Exchange that can be revamped to house small to medium sized technology companies or artistic people. These are people who are demanding in terms of a certain funky ambience but who have no need for the high gloss and polish of modern high rise office towers. In fact, the environment of glass and steel with its sharp corners and strictly segmented spaces are anathema to the creative drives of a (mostly) younger generation.

Several buildings were examined in the course of this study to determine their suitability for new Internet-type companies and artistic talents. The aim was to look at buildings that could be refurbished in a style that would provide the minimum of requirements while still satisfying a goal of having rental costs contained within a $7-$10 sq/ft range. Information was generated for a selection of 5 buildings that fit these criteria. A sixth one was added to provide information on a Class "B" type building that would fit a heritage image but be more in the $15-$16 range suitable for a larger anchor tenant such as Momentum Software Corp.

Example Buildings Suitable for the Corridor

Building #1

Currently owned and largely occupied but owner would sell the building and relocate his/her business to an alternate location. The building contains a sprinkler system throughout, however no other significant upgrading or maintenance has been undertaken since the current owner occupied the building.

The estimated value of the building is about $150K. The cost of bringing this 30,000 square foot building to the tenant improvement stage is $3M These costs include the installation of a new elevator and new washrooms.

Building #2

This building provides a landmark as an entrance to the Exchange District. It has the following features: 2 exit stairs, 3 working elevators, good hardwood floors and tin ceiling throughout, operational sprinkler system, new boilers, 11 '-6" floor heights on all floors. The City of Winnipeg currently owns the building

The condition of this building provides for cost-effective redevelopment. Restoring the building by removing the existing stucco façade to expose the original brickwork would give this building the heritage characteristics in keeping with the Exchange District.

Once renovated this building, which contains 56,000 square feet of usable space could accommodate up to 30 small businesses or artist live/work spaces. Total costs of upgrading the building would be between $4-5 Million.

Building #3

This building has four stories and 40,000 square feet, including the basement, warehouse building structure. It been upgraded on the main and second floors. Upgrades to the basement have been limited to washrooms for the above-mentioned establishment. Mechanical and electrical upgrades were confined to the basement, first and second floors. The third and fourth floors have not been upgraded. Some have proposed the reuse of this building could house 10-12 artist live/work loft style apartments (or an equivalent number of small businesses), an interpretative centre, gallery space, workshop, classroom and demonstration space, and commercial office space. The upper floors of the building could be "minimalist" style loft apartments allowing artists to create their own environments.

It is estimated that it would take $2.5-3 million for base building upgrades. As an example the building could provide for residential on the 3rd and 4th floors, office use on the 2^nd floor to the tenant improvement stage, and exhibition/ studio/ art gallery on the main floor and in the basement.

Building #4

This building consists of retail space on the main floor with storage in the basement and the upper three floors. It totals approximately 27,000 sq ft. Renovations to the tenant improvement stage is estimated at $1.8 M.

Building #5

Has about 25,000 sq ft. Building cost about $200K, and would cost about $1M to upgrade the main parts up to standards. The current owner works hard at getting all available grants such as the Heritage ones.

Building #6

This building has 190,000 sq ft of class B office space at 32, 000 sq ft per floor Parking available for up to 200 vehicles Finished it will look like 181 Bannatyne, a renovated building housing several IT firms. Rental costs will run around $15-16 per sq ft.

Why Renovate?

The older buildings have a major appeal for the young entrepreneur. They reflect an older historical culture. The idea of roots and "recycling" to this environmentally conscious generation is also important.

There is also an esthetic charm to the naturalness of the open beams, brickwork, large window wells, the fashionable decorative side, and the open character of the old warehousing buildings. They are seen to transcend artificiality, and to personify the individual and personal.

The buildings have a nice scale and high ceilings. While the material used is inexpensive it has a contemporary character to it. Lighting fixtures can be exposed, electrical and ductwork can be industrial in look. All kinds of changes can be made to accommodate the vicissitudes of the day for these horizontally structured semi-autonomous companies.

Tenants Like to Personalize Their Low Cost Buildings

Some of the things that tenants might do to equip their building space to either add to the overall sense of their purpose or to enhance productivity:

Order food from Costco and sell it to employees at cost.

Scatter refrigerators containing food and drink

Have showers so people can cycle in from work.

Provide cots for those people who are working around the clock.

Renovation Challenges

Of course there are challenges with old buildings:

Heating and cooling systems are always a problem when there are multiple tenants, each wanting something different and with open paneling blocking air flow.

When drastic changes in outside temperatures occur, the heating arrangements can be particularly bad. In such cases people need to work from home, or use heaters or alternately in the summer open windows,

Parking is currently a big problem

While the costs of bringing a building up today's building and fire standards might be easily projected, the costs of operating these buildings are less so. Several factors are important in considering ongoing costs:

Expenditures for such things as computer network/wires. Computer cabling, fax, telephone, servers/broadband will vary considerably depending upon customer demand.

The mode of operating from building to building could be different. For instance one group might elect to have each company make their own arrangements while another might want to run a service bureau sort of operation in which there is a large-scale sharing of resources, See Appendix III for an example schedule of services that might be offered.

Summary

There is significant value in proceeding with the Innovation Corridor. To ensure the corridor's success, several critical elements must be put in place. First, a suitable area in Winnipeg must be found. Winnipeg has a very good candidate in its Exchange District. Second, a development group needs to help develop a collaborative environment and community focused approach to development. Third a dynamic, unique and stimulating environment needs to be created. This vibrant environment can only be created through building a mixed-use community that integrates artists and web companies with entertainment, retail and eating establishments. This type of approach will produce a district with an energy that can be used in a larger marketing effort to the world

Innovation Corridor Technology Components

We will need to rewire scores of low-tech, often turn-of-the-century office buildings in Winnipeg's Exchange District for the emerging digital economy.

Constructed in the latter part of the 1800's and the early part of this century our heritage buildings were never designed to meet current fire regulations, building codes and the advanced communications systems that web-based companies require

Few if any of Winnipeg's older buildings are equipped with the fibre optic wiring needed to handle the array of digitized telecommunication services that are in increasing demand these days. Many don't even have adequate space set aside to house all the new cables and switching equipment.

Fortunately there are a host of telephone, cable television and computer services firms that are now available to provide broadband links to buildings in the Exchange Area at reasonable costs. Of course its one thing to get the capacity to the building, another thing is to get it to the desktops. Again this is not difficult and may be made easier by the open landscapes that will prevail in the "refreshed" heritage buildings.

The Corridor should provide technologies that can be cost shared among the tenants of the corridor and should be assumed part of the infrastructure of the corridor. Several technologies can be considered. Among these are:

Internet access and building wiring

Video-conferencing and projection facilities located in large shared meeting rooms

LAN servers

Video servers

Web servers

Cable or Satellite TV access

MRnet access

The technologies mentioned have various degrees of importance and many different implementation and ownership issues surrounding their use. These will be discussed in general with cost estimates where appropriate.

Internet Access

Because of its significance and influence, the Internet must be made readily available to tenants of the Corridor. Solutions for providing low cost access to the Net are many and varied. While the Caver's initiative shows tremendous possibilities in furthering the availability of low cost broadband there are unique issues that challenge the successful integration of Net access into the Corridor:

Security. The successful Internet access solution must provide at least a basic security mechanism to keep the tenant's computers separate from each other while still granting shared access to the Internet.

Network cabling technologies. Broadband costs are plummeting and within a very short time will be well within the reach of the costs that small companies can afford. Informally we have an estimate that 100MBps connection can be supplied at $3k a month and may be negotiated lower. Of course any technology selected must be widely used and well supported so as to keep the tenant's cost of connection affordable and the maintenance costs reasonable.

Internet Access Recommendations

Within buildings, the most recommended technology is Ethernet over copper for the horizontal floor by floor wiring drops, with fiber-optic cable for the vertical backbone circuits.

In general, three cabling technologies provide possible solutions for Internet access. The three choices widely supported and available today are fiber-optic, unshielded twisted pair and wireless. Ranked by maximum possible speed, fiber-optic is positioned at the high end with unshielded twisted pair (copper) in the middle and wireless at the low end. Fiber-optic and wireless are the most costly with copper being the most affordable and most commonly used.

Issues of security add additional costs. Intelligent switching hubs in the wiring closets can provide the basic level of security required and allow for configuration of different speeds for each tenant. Intelligent switching hubs would allow for one Ethernet speed Internet access port of 10 or 100 Megabits per second in each tenant's work space. If more than one computer is to be connected, the tenant could supply a hub for this purpose, or purchase additional access ports at an incremental cost.

Intelligent hubs also allow for the integration of Gigabit Ethernet for MRnet access to select tenants. MRnet access would likely involve installing an additional fiber-optic drop from the nearest wiring closet to a tenant's office, at an additional charge. Many companies would install fiber-optic at the same time as copper, leaving the fiber-optic unused until such time as the additional speed was required.

For the primary Internet feed into the buildings, all three of the above technologies could be employed as well. Each has a different impact on costs when used for outside connectivity. An 11-Megabit wireless facility for example, may be cheaper in the long term as it has no monthly facility charge, however it does cost considerably more to install. Copper leased lines, such as traditional T1 or T3 technology could be used as well however the monthly cost begins to rise as the speed goes up. Since the Corridor is located in the downtown area, fiber-optic may also be available, allowing Ethernet speeds from an ISP to the Corridor.

Cost Estimates

There are several ownership models to consider in building the Internet access solution for the Corridor. A building's landlord, for example, could take ownership of the cabling plant and supply access to tenants in their rental agreement. In this model the landlord could supply Internet at the shared cost, just as they would supply heat and light.

The entire solution could be tendered out to a single or various suppliers. The design and installation could be separately tendered, with ongoing maintenance and even the Internet access feeds on separate tenders as well, allowing for different suppliers to become involved in the Corridor project.

Cable Plant Costs

Vertical Building Wiring Plant:

Primary switch $25,000 per building

Wiring Closet switch $5,000 per floor

Fiber-optic Vertical $1,100 per floor

Copper Vertical $189 per floor

(wireless may not provide the security needed without additional cost per floor)

Horizontal Building Wiring Plant:

Copper from Closet to Office $150 per drop, $50 per computer

Fiber-optic "" $300 per drop, $250 per computer

Wireless "" $450 per computer

(per computer cost paid by tenant)

(only one of the three above options for office wiring would be used throughout, with the exception of MRnet users, as mentioned below)

External Internet Feed

10 Megabit shared Ethernet $2,000 per month

100 Megabit shared Ethernet $3,000 per month

Leased Line: (T1)

1.544 megabits $3000 per month

Wireless: (11 Megabits)

End to End Installation $20,000 one time expense

Internet feed over wireless $1,500 per month

The costs shown above are quoted costs today. Under competitive bidding conditions many of these costs will be noticeably lower. These technologies are always changing, the costs will move down under any scenario and the service levels will increase as time goes on. Since costs are unpredictable in the future, Internet access service should be tendered out for competitive bids every few years.

Video Conferencing and Projection Facilities

High end video conference and projection facilities could be located in a shared meeting room environment that could be booked by tenants and perhaps others as well. The landlord or a facility vendor would be responsible for booking the room, training users and maintaining the equipment. The cost of design and installation of a Video Conferencing System would be from $50,000 to $150,000. There would also be a monthly ISDN charge of roughly $300 with additional charges applicable whenever long distance videoconferences were held. A quality projection facility would cost anywhere from $8,000 to $25,000, including a sound system. Some funds should be put away, perhaps from rental fees to upgrade and repair the equipment from time to time.

LAN Servers, Web Servers, Video Servers

All server equipment is grouped together because they all represent a similar challenge. Each office or tenant will have extremely different and sometimes incompatible needs for sever equipment. For small offices, a landlord might supply a building LAN server. However, due to the differing security and service needs of tenants, any planning or costing would have to be done only based on potential scenarios.

A more practical suggestion is that vendors be encouraged to locate an office in the corridor and supply these services as needed, dealing directly with tenants. The vendor would gain a fair amount of business providing computer supply and support services for the tenants. Tenants with similar needs could join together to reduce costs. An incentive system could be considered for vendors as well as tenants. Prospective tenants should also be polled to determine their specific needs.

Cable or Satellite TV Access

Many business-dominated areas of the city suffer from lack of cable TV access. Because a large number of New Media companies are expected in the corridor, special attention and/or funding should be allocated for infrastructure costs to ensure that some form of television access is available to the tenants. Here again, the TV signal provider would directly deal with the tenants for these services.

MRnet Access

As briefly mentioned above, the MRnet must be extended into the corridor from the nearest point of access, which is likely going to be the NRC-IBD building at 435 Ellice Avenue. The monthly cost of this access will likely be $3000. MRnet is an optical network and as such will require fiber-optic access for each MRnet user. This will require tenants wishing to be part of MRnet to install an additional fiber-optic connection from their office to the nearest wiring closet. The cost of installing this extra fiber-optic cable will be anywhere from $400 to $1,000 and may incur an additional $1,000 to $2,000 one time cost for a port on the building switch.

View from the Cyber Community

The overwhelming majority of entrepreneurs attracted to the "Innovation Corridor" will be young and the companies they work in will be small.

The Dynamism of Smaller Firms

Smaller firms in all sectors are demonstrating that they are better able to cope with the challenge of creating and sustaining a culture that is adaptive and responsive to change. It is easier to communicate in smaller firms because there are fewer levels of management, less bureaucracy and fewer rules.

The average age of employees at Internet service providers (ISPs), though not surveyed in a scientific fashion, is under 30, and many are not even high-school graduates. Many ISPs are very small businesses

Employees in software specialist firms are generally under 30 years of age, with earnings higher than the national average for white-collar professionals, and most are university educated.

Employees of in-house software departments are typically between 30 and 45 years of age and the primary source of entrants is from community colleges; they may also be self-taught.

According to all who have been interviewed, the growth of electronic commerce is projected to be so large, and the impact of the Internet so fundamental, that no one doubts the continued relevance and importance of this growing sector of the economy.

High quality talent is attracted to companies that have a well-articulated, promising strategy to develop innovative products. They look for high productivity co-workers and companies that are considered good places to work. They also typically want a share of the equity potential of the firm or the products they are developing.

In-person interviews were held with individuals representing small and medium sized businesses. See Appendix IV for details.Many were in support of the Innovation Corridor concept and felt they would be inclined to re-locate if there were adequate reason for doing so.

Lease Rates

Current tenants in the Exchange District consist of many existing small, entrepreneurial, technology-related companies. They indicated that the rent in that location ranges from $4 to $7 per square foot. To locate within an Innovation Corridor the rents must be within this range or better and the Corridor will have to offer additional services as well.

Shared Services

Many respondents felt access to high-speed Internet access and video systems would be important factors within a corridor. The cost of starting a business is prohibitive for many people and the ability to share resources would enable many to start a business.

Atmosphere

A large number of respondents are young people who own young businesses. Many would like to see older, existing structures renovated into dynamic settings with a creative ambience. The overall look and feel of the office setting is important to them, as is a downtown location. They stated that locating with other businesses similar to their own would ensure a helpful, collaborative environment where both short-term and long-term partnerships could be developed. Many of these companies specialize in a particular multimedia area and like the idea that other young companies with expertise in different areas are available in close proximity. The term "developing a community" was mentioned on more than a few occasions.

Accessibility

A significant drawback of a current downtown location is the lack of parking. The availability of street parking is also limited and its complete inaccessibility during certain hours makes conducting business extremely difficult.

Infrastructure

Current buildings with rent rates under $10 sq. ft. do not offer significant benefits by way of facilities and infrastructure. Extensive upgrades are required to existing HVAC systems, washrooms and elevators. Accessibility to persons with disabilities, an attractive lobby/entrance area, daycare services, on-premise food services and a gymnasium would all be viewed as benefits.

Marketing Services

Companies interviewed stated they felt that shared marketing services would be advantageous due to the high cost traditionally associated with marketing. They felt that small companies who cannot afford to spend funds on necessary marketing services often overlooked marketing.

Remote Locations

Several businesses located quite a distance from the proposed Corridor were polled as well. While they felt that they would not locate in the Corridor, they also mentioned that a virtual Corridor location should be considered.

Summary and Recommendations

If Manitoba is to succeed in the digital economy it must create the arrangements that will allow it to compete. These structures are of a governance and physical nature. The governance aspects are addressed in Volume I of Securing Our Future: A Manitoba Innovation Corridor, Solutions for the Next Century. The recommendations contained in that volume are summarized in Appendix IV

This volume is oriented almost exclusively to the physical environment in which the processes and actors, necessary for thriving in the digital economy, play their parts. Recommendations that arise specifically in this volume are:

Winnipeg's Exchange District should become the location for our Innovation Corridor for 3 main reasons:

As a National Historic Site designation it is both unique and can be profiled to Winnipeg and Manitoba's benefit in a manner no other city can emulate.

It's historic roots and turn of the century architecture can be adapted to create a funky, dynamic and wrap-around environment in a way that could make it most attractive to the young entrepreneurs that dot the internet landscape.

With a modest amount of expenditure it can be made to be the ideal, low-cost home for a hundred or so digitally based companies.

In implementing the Innovation Corridor recommendations and in establishing the various governance structures the Manitoba Innovation Network, with its proven record in building economic community-relationships and resilient linkages between community and economic interests, should be called upon to play a lead role.
An Economic Development Group with representatives from all three levels of government should be established to guide development.

This group would be responsible for the physical aspects of the corridor, as well as the mix of business, and a host of amenities.

Added to their responsibilities would be the functions of an Urban Development Bank and an information and marketing resource.

A "pot" of money should be devoted to "kick-start" the Corridor. Approximately $10 million, would be sufficient to revamp a couple of buildings, to get the process going, and to allow participants to experience-rate the concept. Attempts to do the entire program under a single master plan should be resisted. The rule in dealing with the many inputs, players and possibilities that will be swirling around this venture is to proceed in an adaptive-sequential-decision-making mode.
The buildings should be well equipped technologically and costs to the companies that occupy them should be relatively low. Those costs should however represent enough of an out of pocket expense to indicate commitment.

Appendix I: The Experience

Lower Town, St. Paul's

The progress achieved in Lowertown in the city of St. Paul's is an excellent example of the work being undertaken in many cities in North America as citizens everywhere adjust to the dictates of the digital economy.

Lowertown was an area of fine old buildings, neglected riverfront, vast parking spaces, and abandoned railroad yards. For decades, it suffered from deterioration and neglect.

The Lowertown Redevelopment Corporation (LRC) was established in late 1978 by a $10 million support commitment from the Mclnnight Foundation. LRC's mission was to carry out the City's revitalization through the creative urban design and use of private foundation resources.

After 14 years of effort: $428 million in investments were generated in the area, 4300 jobs created, city's tax base broadened 400%, and over 1500 housing units provided for various income levels. Projects include a variety of housing, a number of mixed-use projects, a new television station, incubators for businesses, offices, new hotel, YMCA, Farmers Market, restaurants, theaters, parks, children play space, and a host of other amenities.

Every dollar the LRC invested in Lowertown has attracted $20 in additional public and private investment.

Today's Lowertown is a kaleidoscope of colourful impressions. High-rise apartment and condoMINium towers. Saint Paul's most interesting historic buildings and one of America's most beautiful urban parks. The sweep of the Mississippi, broad riverfront plazas, boat landings and byways, shops and offices. galleries, theatres and studios, restaurants of every ethnic stripe, arts, dance, music and cultural activities are everywhere. The area witnesses a daily rich diversity of people walking talking and enjoying as they promenade narrow tree-lined streets.

All together, they make up one of the city's most livable and fastest growing neighborhoods. It is an exciting new place to work and build a business in the Digital Age as well as being one of America's most successful realizations of a vision for living well in today's world.

Lowertown has had commercial ups and downs but now seems on a steady upward course with high occupancy rates both in office and apartment buildings. The cyber-village influx is part of the growth, as fledgling firms select historic buildings for their operations.

Public/private partnership played an important part in St Paul's success complemented by strong leadership, financial commitment, and competent management.

St Paul Capitol River Council, Artists Collective, Chamber of Commerce, Convention and Visitors Bureau, Capitol City Partnership, Riverfront Development Corporation, labor union, city agencies, private foundations, and neighborhood groups all played a role in community building. The shared vision, the risk taking, and the persistence of effort paid off!

Appendix II Artist's Village in the Exchange District

AN INVESTMENT IN WINNIPEG'S PUBLIC INFRASTRUCTURE

DRAFT DISCUSSION PAPER

April 20,1999

THE IMPORTANCE OF HOUSING IN THE DOWNTOWN

Establishing and maintaining healthy downtown residential neighbourhoods is fundamental to a City's well being. Housing in the downtown contributes to safety by adding twenty four hour life, it is a cost effective use of municipal infrastructure by intensifying density on serviced land, and it increases the property tax base by upgrading building values. Downtown residential neighbourhoods need support services and amenities as do any other neighbourhood. They need recreational areas, suitable parking, efficient street systems, quality public spaces, pedestrian-oriented environments, neighbourhood lighting, streetscaping, landscaping and street furniture.

Downtown rejuvenation requires support to existing and emerging neighbourhoods. Research conducted through CentrePlan found that developers are not interested in building new housing downtown because there are presently very high vacancies in downtown high rises. Developers reported that the only housing niche still unfilled in Winnipeg is loft style, MINimalist studio apartments with live/work capacity, and that the obvious location for this option is to convert warehouse buildings in the Exchange District. The District continues to be home to significant volumes and varieties of arts and cultural facilities, institutions, services, artists and performers. These kinds of activities are good for downtown because they attract people in the evenings and on weekends, they attract people who may not typically visit downtown, as well as out of town tourists.

Through consultation and research, the City, Province and downtown stakeholders have determined that the highest and best use of a number of historic buildings is conversion to affordable live/work spaces for artists. Obstacles to conversions have been identified as costs attributed to strict building code interpretations, zoning restrictions, and an absence of demonstration projects to instill private or public confidence in investment. Converted projects will have tremendous impact on the restoration of the downtown, focusing on the heritage district, its buildings, economy and identity. Not only will a significant number of viable, affordable, live/work units come on stream, but the entire neighbourhood will be firmly established. Its unique identity and function has slowly been emerging over the past fifteen years but the obstacles to further development have hindered progress. The timing is ideal right now to pull all the pieces and players together, infuse some extra resources, and see the evolution move into the next logical phase.

ARTIST'S VILLAGE IN THE EXCHANGE DISTRICT

CentrePlan, the Exchange District Strategic Action Plan, and the Building Blocks Housing Forum document support for additional housing downtown. Surveys conducted recently confirm widespread interest in living in the Exchange District and both developers/building owners and potential tenants/owners profess strong interest, even commitment, to developing living spaces in the Exchange. There is also agreement among Winnipeggers for increased government financial support to the arts (59% moderately and strongly supportive, September, 1998 city-wide survey). The Exchange District's identity as a focus for culture and arts has been naturally taking shape for at least the past fifteen years. Public investment in physical improvements (streetscaping, trees, lighting) has contributed to a general improvement of the design and look of the district. New businesses have moved in and galleries continue to flourish (about 33 in the Exchange District alone). The atmosphere is upbeat and interesting with a youthful energy within a historical background. As part of its distinct identity, the District lends itself perfectly to the formation of an artist's village or quarter.

The following provides a brief summary of four recent and current initiatives that show the timeliness of venturing forth with an intensive and innovative investment.

CentrePlan is the downtown plan and process followed for the past four years. CentrePlan's visions, strategies and action plans grew from the extensive public consultation conducted over a two-year period. CentrePlan's actions directs:

conversion of buildings in the Exchange District to residential use

review and analysis of building code regulations to encourage redevelopment of existing buildings

development and promotion of a number of methods to promote and reinforce housing downtown

support of existing and encouragement to the location of arts, entertainment, sports and cultural facilities downtown

CentrePlan sponsored a Housing Forum in May 1998 to explore partnership possibilities among private and public sector interests to implement those plans. The 244 participants at the Forum overwhelmingly agreed that the Exchange District should be developed with converted warehouse/heritage buildings to accommodate live/work spaces and mixed uses.

CentrePlan also commissioned an arts consultant to research space requirements, affordability, and level of interest among artists to occupy loft style spaces in converted heritage buildings. Support for the concept is very high. Further, consultation with developers revealed there is no interest in building traditional high rise apartment buildings as the market here is full of product and high vacancies. However, developers confirmed real commitment to conversion projects of loft style, minimalist units, with live work capacities and mixed uses.

In July, 1998, City Council passed a motion directing administration to find ways of providing viable building code equivalencies and amending zoning by-laws to accommodate mixed uses, live/work and residential units in the downtown. The clearest, most pragmatic means of fulfilling this direction is through demonstration projects of live/work spaces.

The Exchange District Strategic Action Plan's priorities are to encourage the conversion of older buildings to residential and identify and to support an artists quarter in the Exchange.

The Exchange District has been designated a National Historic Site. A partnership of the Federal, Provincial, City governments, community agencies and the Exchange District Business Improvement Zone is developing an interpretive plan to maximize the benefits of the designation. A key theme identified in the plan is the arts and culture activities in the area. Promoting these activities is fundamental to the District's future. Through interpretive plan implementation, the District will become even more of a center for commercial, round the clock activities and a prime destination for visitors. These uses are entirely compatible with expanded residential presence.

The Artist's Village concept is under consideration by the Provincial government with City support and input. The concept consists of seven components; sales/marketing, exports/training, outdoor artist's market and village, tourism destination development, art making demonstration, commercial and public galleries and housing/studio accommodations for artists. The City and the Province are attempting to piece the components into a viable whole. Without public sector investment in housing, that critical component will not materialize and the opportunity to create a complete artists village will be lost.

Public-Private Partnership: Joint Venture to Achieve a Public Goal

Municipal and provincial governments invest in projects with a private party with the expectation of achieving a public goal and economic benefits. The advantage of this approach lies in the potential to develop or improve a public service or infrastructure that could not be done without private participation. Municipal assets are levered to add value to a project. Government support is often required to kick start some initiatives because conventional financing sources do not always perceive the public investment aspect nor do they have the inherent responsibility to establish foundations of community economic development as do governments. Establishing sustainable ventures is an appropriate governmental role because the involvement instills confidence and attracts private participation.

Artist's initiatives and housing have particular needs in that they do not always generate immediate profits. These activities form the bases for economic sustainability through stability, cohesion, and a reliable multiplier effect. Housing artists, artists-in-residence and visiting artists provide the 24-hour stability downtown needs to generate year round activity and interest.

Homesteading the Exchange District: Artists as Pioneers

The artist's village concept has been successfully implemented and operated in many cities for several years. An artist's village involves a number of elements that support, promote and maintain artisans and crafts persons in the creating, teaching and marketing of their skills and products. Activities within an artist's village attract people to visit, to interact, to learn and to purchase products. A critical component of an artist's village is housing and artists-in-residence facilities.

Central components of an artist's village include:

community interaction; education, viewing artists at work;

professional development and ongoing training;

studios;

exhibition & performance spaces;

sales;

exports;

shared support amenities and services; e.g. kilns, fax, computers, production equipment, and;

housing, artists-in-residence and visiting artist's accommodations.

Support and ancillary functions to an artist's village include:

performances;

festivals;

public art tours;

street vendors;

buskers;

restaurants and bars;

connections with The Forks; shuttle, street car or trolley;

promotion opportunities; e.g. gallery openings all on one night.

Current Provincial Government's Interest in Artists Village Development

The Provincial government is interested in development of an artist's village in the Exchange District. Work is underway in two Departments to describe the concept and commence financial analysis of the components.

First, the Department of Culture, Heritage and Citizenship through the Arts Branch and the Heritage Resources Branch, Minister Rosemary Vodrey and Deputy Minister Roxy Friedman directed administration to develop an Artist's village concept based on the model visited in London, England called Clerkenwell Green, that would fit the Exchange District setting. The minister and the Deputy were enthralled with what they had seen and wanted administration to flush out a viable concept. Part of their exploration involved meeting with City administration working with CentrePlan to find ways of complementing similar goals into meaningful solutions. Arts Branch staff participated in CentrePlan sponsored Artists consultation and the Building Blocks Housing Forum and we have stayed in constant communication throughout. Their work is ongoing and has not been formally approved or adopted by the MINister. However, Arts Branch staff were able to provide an unofficial description of the concept's components. The components are as follows:

Component 1 - Housing/Studio Accommodation for Artists

Potential expansion of Artspace into the Annex and new to-be-developed studio/residential accommodation by private development of the Big Four Building and the Kays Building (this concept calls for arts-making activity on the ground-floor; studio/residential lofts on the top five floors; closing of Arthur Street between Bannatyne and McDermot for green space with a sculpture garden). This addresses the need for revitalization of the Exchange District, preservation of heritage buildings and provision of affordable studio/residential accommodation for artists/artisans.

Component 2 - Artspace

Enhanced presence and services for marketing Manitoba's cultural products, in coordination with tenant industry associations; e.g. Manitoba Book Publishers, Manitoba Motion Picture Industry Association, Manitoba Audio Recording Industry Association, Video Pool Inc., Winnipeg Film Groups, Floating Photography Gallery, Main Access Gallery. Potential expansion to accommodate increased cultural product development and/or marketing of such product. Addresses needs for revitalization, preservation of heritage buildings, affordable accommodation and promotion of Manitoba's cultural products.

Component 3 - Art Making Demonstrations

Open workshops in weaving, ceramics, jewelry making, glass blowing, quilting, printmaking, etc. open to the general public passing by. Addresses need for increased public and tourist awareness of cultural community and its products, professional development for artists and crafts persons, general crafts education, market outreach for Manitoba art and crafts. (Comparable to Harbourfront in Toronto)

Component 4 - Outdoor Artist's Market and Village

Expansion of programming in the park and its entertainment stage (already presenting noon hour concerts by the arts festivals: Fringe, Folk, Jazz, Folklorama), sidewalk sales of cultural products, film-making demonstrations in the park, outdoor craft demonstrations in the summer, a festival of fine art. Addresses revitalization and tourism promotion.

Component 5 - Commercial and Public Galleries

Site, Plug In, Ace Art, Adelaide McDermot Gallery, Warehouse Art, WAG's Art Walk, with coordinated exhibition promotions, sidewalk sales. Addresses outreach for new audiences and for tourism.

Component 6 - Establishment of a Cultural Industries Export, Training and Events Coordination Storefront in Artspace

The office will provide advice and shipping services for clients marketing outside the country, brokerage for partnerships within cultural and corporate community for exporting. It will coordinate training opportunities for cultural product development and coordinate and promote events, both entertainment and hands-on demonstrations in art and craft making for the general public. Addresses need for new audiences, professional development amid cultural community, promotion of cultural product and revitalization of the Exchange District.

Component 7 - Special Funding for the Promotion of Artist's Village as a Tourist Destination

Concept details unavailable at this time.

Outcomes

The Arts Branch identifies the following positive impacts of this kind of development:

Increased numbers of young and creative artist/arts organizational workers living in the Exchange District;

Safer streets after hours in the Exchange District;

Improved business climate in the Exchange District;

Increased attendance at performing arts events; increased sales for Manitoba's cultural products, capture a larger share of the tourism market;

Increased export of Manitoba's cultural products; enhanced reputation of Manitoba as a cultural centre;

Increased visitors to the Exchange District area, and;

Increased services in the Exchange District.

Heritage Resources Branch is presently involved in discussions with stakeholders at the City, the Province, and the Exchange District BIZ to develop an overall plan for reuse of historical buildings in the Exchange District. According to the Director of Historical Resources, the emphasis is on unleashing the economic benefits of historical buildings in a framework for decision making that coalesces financial sources, decision makers, implementers.

The second Provincial Department interested in the Artist's village concept is Government Services. The Accommodation Development Division (ADD) prepared a report entitled 'Artist Village'. The Division can apply its staff resources to "program planning, leasing, cost estimating, project management, and contract administration if one of the proposals needs to be developed from the conceptual stage". The report also provides an initial financial analysis to renovate six buildings in the Exchange to residential/mixed use.

The six buildings examined were:

Artspace

Ashdown Hardware Store (Big 4)

Mondell's Imports

Kays Building

Artspace Annex

Leland Hotel

The financial analysis showed economic value in focusing on City owned buildings as the logical choice of public-private joint venture partnership because:

The City has already made a significant investment;

The Province could then match the investment through interest free loans and in kind services, and;

The private sector would act as developer.

The end result would be a reasonable number of live/work units, available for rents within the affordable range identified through consultation.

The report concludes that an artist's village is a "worthy project. Winnipeg has the ingredients to make this concept a reality in the Exchange District. The financial aspect of the artist village concept appears to have the support of the private sector in the plans for the Kays Building, Mondell's Imports Building, and the Ashdown Hardware Building. Private sector investors can apply for financial assistance, through existing programs, from the three levels of government. Financial support could aid in redevelopment of these three buildings".

The report recommended converting city owned buildings with provincial financial support through interest free loans and professional services. The report further advocates expanding Artspace physically to adjacent buildings and extending its management capacities to more components of the artist's village model. "With the completion of the above projects, Winnipeg would have an Artist Village where artists could live and work in studio style apartments in a community that would foster the continued excellence of art in Manitoba."

MANAGING THE PROCESS

A Joint Venture Working Group could guide the project, consisting of municipal and provincial representatives, community volunteers (CentrePlan's Artist Live/Work consultation identified a number of interested individuals willing to serve on such a Committee or Working Group) and private sector participants. The role of the Group would be to plan and guide project completion, develop management structure of the finished product and contribute to a marketing strategy of the artist's village.

Examples of Canadian Cities' Artist's Village Developments

Edmonton

The City of Edmonton designated a portion of the downtown as an Arts District. The area has 12 cultural facilities. The Arts District Partnership, with representatives of key stakeholder groups, is working together under the auspices of the Downtown Development Corporation to pursue the Arts District Action Plan. This will be done through four focuses: physical development, programming/activity, communications, arts spaces and residential development (development of artist live/work spaces to which the City contributed seed funding). Operation of the District is a public-private responsibility. Rationale behind the establishment of the District is based on the following assertions:

Arts Districts benefit the arts community with a natural clustering of activities;

Arts Districts are ideally suited to the downtown; they offer a replacement to manufacturing and industrial industries that formerly predominated downtown but have moved to suburban locations; they attract people in the evenings and weekends and help retain businesses downtown;

Arts Districts draw tourists; local and from away;

The Arts are labour intensive and completely renewable. Artists do not switch occupations and can not be replaced by technology;

Strong Arts activities define a city's image to itself and to the world;

The economic impact of arts activities city-wide totals $75 million annually; the cultural institutions in the Arts District generate $30 million in expenditures annually.

Toronto

Toronto Artscape is non-profit organization in both development and management of artist's work and live/work spaces. Artscape's operations are funded in part by an annual grant from the City of Toronto. Currently there are five properties within the development, with the projects coming on stream since 1191. In total there are over 120 living units and studios as well as a performance centre, concert hall, recording facilities, gallery and administrative offices.

Appendix III A Conceptual Menu of Services and Rentals for Tenants

SERVICE

COST

DETAILS

Photocopying

.06 ea

up to 500 copies

.04 ea

over 500 copies

Postage

regular postage plus 20%

Fax Machine

$20/month flat rate

long dist. charges added to monthly billing

Color LaserWriter Printouts

$1 ea

specify how many

Building Network/Internet Access

$20/month

must sign agreement

Email

$5ea/month

unlimited time when used within building

-Dial-in access from remote location

$2/hour

LaMINator

No fee

must provide your own supplies

must be left in tenant services room

Binding Machine (Cerlox)

No fee

must provide your own supplies

must be left in tenant services room

Boardroom/Meeting Rooms

No fee

first come first served

TV & VCR

No fee

for boardroom and office use ONLY

first come first served

Slide Projector

No fee

for boardroom and office use ONLY

first come first served

LCD Panel

No fee

must not leave ATC, no overnight rentals

- when using off-site

$100/day

$500 deposit and must sign a waiver

Overhead Projectors

No fee

first come first served must not leave ATC

10 cup Coffee Urns

$5 per fill and/or rental

we require at least two days notification

Regular SeMINars & Workshops

No fee

(up to $50 value per attendee)

A MINi-Library of Magazines

No fee

AdMINistrative Services

Has files of information and brochures, such as: Resumes, Hospitality information (catering services, hotels, etc.), various banking information and brochures, and more

Parking

No fee - Unlimited outside parking with power outlets.

Leasing Conditions

Based on a month to month

Janitorial Services

Include vacuuMINg and nightly garbage removal

Storage Space

Limited storage space available, we will do our best to accommodate

Security

Regular business hrs. are Monday to Friday, 7:45am to 5:00pm, otherwise an access card is required to enter the building

Signage

Each tenant is provided with a name plate (if company name changes special arrangements will have to be made)

>Appendix IV Online Questionnaire

On-line Company Questionnaire

Would your company be interested in co-locating within an "Innovation Corridor"?

As an entrepreneurial business what would you consider to be the benefits of co-locating in an innovation corridor?

* Detailed responses to above questions located in "corridor answers" document.

31 of the respondents stated they would support an Innovation Corridor. 12 stated that they did not feel that they would personally benefit from location within the corridor but were in support of the Innovation Corridor concept itself.

Respondents ratings with their answers and percentages listed below:

(Rate in order of importance with 1 being most important and 5 being least important)

1

2

3

4

5

A) Access to high-speed bandwidth:

40%

10%

25%

10%

15%

B) Shared resources including servers, networks, printers:

25%

10%

23%

8%

18%

C) Access to financing (i.e. venture capital):

23%

28%

18%

8%

25%

D) Inexpensive floor space (i.e. lease rates):

38%

15%

18%

5%

23%

E) Co-tenants are in the same type of industry (i.e. high-tech):

28%

20%

18%

10%

15%

F) Ability to develop short-term partnerships with co-tenants:

40%

20%

20%

10%

10%

G) Access to skilled Labour pool:

0%

35%

15%

10%

33%

H) Access to industry professionals (accountants, lawyers):

15%

20%

28%

18%

15%

I) Strategic guidance on markets:

33%

20%

20%

18%

5%

J) Access to government initiatives (i.e. grants, funds):

30%

15%

13%

23%

13%

K) Support on reaching global marketsmarkets: markets:

33%

20%

15%

18%

13%

(FYI: all lines may not total 100% due to some questions not answered by respondents)

Surveyed Companies and Organizations (60)

Online Business Systems			170 employees

Institute for Biodiagnostics			160 employees

Burnt Sand Solutions Inc			160 employees

Linnet Geomatics				85 employees

GB Graphics				65 employees

Momentum Health Systems			50 employees

Robertson College				30 employees

CTI-ComTel Inc. - TelPay			30 employees

Progestic International Inc.			30 employees

Intrinsix Canada Inc.				24 employees

Productivity Point Int'l				20 employees

IDT Inc.						12 employees

Macrodyne Technologies Corp.			12 employees

Maxim Software Systems			10 employees

Jazz Golf				10 employees

Interactive Advantage				6 employees

KIP Communications Corporation			4 employees

Media Design Centre				4 employees

Tundra Lights Communications			4 employees

Tell Us About Us Inc.				4 employees

Lenkos' International Dance Products			4 employees

Kelly Associates				3 employees

Webslingers				3 employees

Jim August Consultants			3 employees

Urban Shaman Inc.				3 employees

REC Associates				2 employees

Fraser Advertising Design			2 employees

Clarke Financial Planning			2 employees

The Web Grocer-e 				2 employees

Executive Computer Training			2 employees

Technologies for Learning Group			2 employees

Clarke Financial Planning			2 employees

WiNN Micro				2 employees

Storyline Fx Inc.				2 employees

Zahradnitzky Enterprises			2 employees

Northern Computer Solutions			2 employees

Accelerated Data Services			2 employees

Creative Directions				1.5 employees

Third Planet				1 employee

Ecostem Ltd.				1 employee

Robert Hardy Communications			1 employee

ShareViews Video Tutor			1 employee

LBL Sales Technology			1 employee

Peterson Consultants				1 employee

Kisik Marketing & Communications Ltd.			1 employee

CoveComm Inc.				1 employee

World of Work				1 employee

LDC - Lila Davies Communications			1 employee

Raven Innovation Network			1 employee

Canadian Technology Network			1 employee

LeBlanc					1 employee

Les services Internet Mabord			1 employee

GREENridge Business Systems			n/a

ManLab Multimedia				n/a

PricewaterhouseCoopers			n/a

MetroNet					n/a

University of Manitoba Industry Liason Office		n/a

University of Manitoba Transport Institute			n/a

CanWest					n/a

Appendix V Securing our Future: A Manitoba Innovation Corridor

Conclusions and Recommendations

November, 1998

Conclusions and Recommendations

The emerging new media market, including companies developing multimedia, web-based educational courses and health telematics products, creates a broad range of opportunities for small and new enterprises. For Manitoba to capitalize on this population and its inherent growth potential we must make it the focus of a targeted initiative.

Examples such as Montreal, Sudbury, New York and Pittsburgh demonstrate the ways in which other communities are working together to develop their particular vision of what their region's knowledge services industry might be like. These communities are recognizing that highly focused specialist companies need to rely on external sources of collective services to spread risk and pool technological expertise.

As Montreal, Sudbury, New York, and Pittsburgh have found, focus is the result of conscious, planned activity. In each case two complementary initiatives were chosen. The first takes the form of designating a building or a group of buildings where companies can come together surrounded by others that will supply support mechanisms. Institutions that provide capital, research, managerial and technical education and training, assistance to entrepreneurs, and market information are vital to these small firms.

The second initiative takes the form of the structural support mechanisms required to produce a "community of interest". In each example, the community created a representative council to plan, structure, and evaluate the development of and interrelations within their new knowledge services industry. These councils create goals and opportunities and produce measurable results in the areas of communications, promotional, and marketing strategies. They also focus efforts on addressing the community's national and international competitiveness.

What seems clear from the above examples is that both a central location and strong representative administrative structures have been present in situations where a region has successfully developed a knowledge services industry. For Manitoba, this information is vitally important if we are to move ahead with building our own successful knowledge services industry. The following conclusions and recommendations are derived from the knowledge that if we are to be successful in the digital economy, we must develop a Made in Manitoba solution that departs significantly from the traditional relationships, methods and cultures that have become a hallmark of Manitoba business.

Conclusion

In every case where cities have moved purposefully to build digital economy industries, a central location and provision of services to fledgling companies was part of the success.

>Recommendation

Economic Development Winnipeg, in conjunction with the Manitoba Innovation Network must begin the process of visioning, planning and developing a Manitoba Innovation Corridor to act as focal point for our digital economy strategy and that the process begin with the health telematics, new media content and education and training sectors.

Work should begin under the responsibility of a new Executive Director who would be funded by the Province and act as liaison between the Innovation Council and the new Corridor. The Corridor would have as its central role the bringing together of Business, Education, and Government in support of Innovation Corridor members. This collaboration would extend to all elements of the community as each plays their part in creating wealth and employment opportunities in the following areas:

Private Sector partners must use their buying power and business networks to provide important information and support to Corridor members. Our industry partners must:

Benchmark the innovativeness and global competitiveness of individual industries through international links.

Promote Manitoba development and design capabilities both domestically and internationally

Implement and use online.mb brands and on-line services

Promote a climate of consumer trust and confidence.

Create new or strengthen existing industry associations to promote world's best practice and encourage innovation.

Implement industry training, skills development programs and entrepreneurial mentoring schemes.

Help attract specialized skills from out of the province.

Develop supportive funding arrangements for Corridor members.

Provide a network of specialists and service providers to facilitate the start-up process among new Corridor members.

Develop expertise in the problems of the information and technology industries-lawyers, bankers, market research firms, consulting companies, public relations companies, and electronic distributors.

The Education Sector must use its well-developed infrastructure to provide the most critical attribute of any Innovation Corridor - an educated workforce. The Education Sector must:

Develop courses that offer important advantages to small companies that seek to attract top talent but are unable to provide the continuing education and training needed in a fast-changing environment.

EliMINate boundaries by encouraging teamwork across educational disciplines and between segments of the educational community.

Partner with industry on technology-transfer and licensing deals, while canvassing companies worldwide for research funding that will spur new discoveries.

Support entrepreneurship in the Corridor by facilitating ties between Corridor members and regional, national, and international development officials, business executives, and venture capitalists.

Establish a research institute to conduct knowledge-based research into the application of technology advances with the aim of assisting Corridor members in their businesses.

Explore ways in which institutions could open their classrooms to local companies to encourage people employed in the technology sector to enroll in graduate courses directly or through a specialized televised instructional network.

Promote the Corridor through in-kind contributions consisting of the use of spare facilities, professorial/student time, joint task forces etc.

Business Associations must help our region cultivate strong loyalties and build unity by acting as a social and information exchange system. Our business associations must:

Act as the catalyst to create social gatherings for Corridor members to exchange information on markets or technology.

Provide support services and networking to create a broader culture of collaboration in the region.

Provide services to assist the management of Corridor technology firms such as: seMINars, educational activities and management training sessions on subjects ranging from finance and technical marketing to production and export assistance

Sponsor trade shows technical symposia, dinner meetings, co-ordinate standard-setting activities, and organize education and research programs for Corridor members and other small firms

Community Associations must provide a key facilitation role in the development of new relationships between users and producers. Community associations must:

Promote consumer confidence and comfort level with new products.

Encourage community-based initiatives and information sharing in the community sector.

Promote solutions for 'digital families' and inter-generational learning

Promote suppliers who deliver consumer-oriented services and who commit to standards of conduct.

Identify market barriers for Corridor members.

Use made in Manitoba technology applications, commission appropriate case studies, and promote support services wherever possible.

Rationale

The Manitoba Innovation Corridor will offer an important source of competitive advantage even as production and markets become increasingly global. Geographic proximity promotes the repeated interaction and mutual trust needed to sustain collaboration and to speed the continual recombination of technology and skill. When production becomes embedded in our regional social structures and institutions, firms will compete by translating local knowledge and relationships into innovative products and services.

Since most Corridor member companies will be small, they are incapable of forming strategy on a regional basis. Corridor stakeholders can provide this service while at the same time advancing the collaborative nature of our regional industries.

Conclusion

Most economic indicators, trends, prognosticators and many other regional jurisdictions agree that the digital age is upon us, that the digital age will mean significant challenges for the existing industrial system, and that the digital age demands innovation and invention to compete. For Manitoba, competing in this new digital economy will require a well-reasoned strategy, community participation, and acceptance of new systems and forms of business relationships.

Recommendation

The Provincial Government must articulate the realities and value of the networked industrial system and describe its planned efforts toward shifting the patterns of collaboration and competition among networks of specialist producers. The Provincial Government must assume a lead role in the following areas:

Updating provincial priorities within a global perspective.

Articulating provincial regulatory priorities in recognition of the realities of the digital economy.

Accelerating its catalyst role for Manitoba activity.

Enhancing its profile as a Model for effective behaviour as a key market participant.

Increasing its service as an information resource manager.

Increasing its efforts to provide government intellectual property rights.

Rationale

Planning policies that direct public resources toward particular technologies or sectors are rarely effective mechanisms for industrial adaptation. It is notoriously difficult for public officials, with or without the collaboration of business, to "pick winners" and effectively concentrate resources on future technologies or applications. Policies to increase competitiveness through the promotion of vertical integration or scale economies are similarly flawed. Consequently our new structures must become a source of flexibility rather than of atomism and fragmentation. The dynamism of our region's industrial system will not lie in any single technology or product but in the competence of each of our constituent parts and their multiple interconnections. Ultimately, Manitoba will be served best by policies that help companies to learn and respond quickly to changing conditions - rather than policies that either protect or isolate them from competition or external change.

Conclusion

In every case where knowledge economy initiatives have been successfully launched, the activities themselves have been the result of a larger strategy and plan.

Recommendation

Our provincial government, in conjunction with other community stakeholders, must create or assign an "Innovation Council" charged with the task of recommending a strategy and implementation plan for Manitoba's digital economy future. This strategy/plan must have clearly defined goals for short, medium, and long-term success, measurable outcomes and deliverables. The Innovation Council will have at its core the task of recommending and monitoring the restructuring our regional institutions to make them more capable of responding to the digital economy. The Innovation Council should consider the following elements as high priority items for strategy formulation:

Defining the structure of a new technology-based industrial system of loosely linked confederations of teams centered on an Innovation Corridor.

Developing the plan for building an industrial system organized around the region and its professional and technical networks.

Creating the methods by which Manitoba can develop a culture of innovation that transcends form and function

Producing recommendations for concrete processes that will help build collaborative traditions that support experimentation.

Developing assessments and recommendations for the future role of export markets and their exploitation

Articulating a plan to develop the venture capital industry to finance regional innovation in addition to financing companies after they have innovated.

The Manitoba Innovation Network can serve as the core of this new council but membership should be drawn from as broad a cross section of community stakeholders as possible.

Rationale

Spatial clustering alone does not create mutually beneficial interactions absent from the benefits of the community relationships portrayed in this document. Manitoba, like regions elsewhere must face the challenges of the traditional industrial structure and its emphasis on individual interests and finite resources. As we move forward, there will be criticism from all sides. Some will see our activities as no more than a public relations effort or an updated version of traditional corporate bids for public funds. Others, particularly those in existing government bureaucracies, will believe that working closely with industry will compromise basic principles of objectivity and mission to which they are committed. This might be particularly true in the larger departments such as health and education. But a strong consortium has the potential to construct a broad-based community of interests in the region and to mobilize the business community. In fact, the work of developing and mobilizing a shared community of interest is the most important work if we are to construct a more decentralized industrial systems that encourages collaboration as well as competition.

Conclusion

An inescapable conclusion of this report is that the digital economy means significant challenges to our accepted ways of doing business. As well, the evidence of change suggests that their effects are no longer in the distant future. They are upon us now. To be competitive, we must respond.

Recommendation

Business, education and government leaders act at the earliest possible moment on the recommendations contained above. Our community stakeholders need to articulate the importance of a new digital economy strategy in the overall plan for the province and transmit this information with the utmost urgency

Rationale

Without the structures and processes required for us to transition our industrial age institutions into the next century, we cannot be competitive. It is clear that it will take a unified effort. The time to exert the effort is now.

In sum, the statistical and experiential story leads to a single overriding conclusion about our future. Our future success will be measured by our ability to transform our current industrial system from that which was appropriate for the last hundred years to that which is appropriate for the next. The emerging model embraces decentralized industrial relationships that blur boundaries between social life and work, between firms, between firms and local institutions, and between managers and workers. This model is distinctly aimed at creating the organizational relationships and workplace practices required by the new industries in their efforts to face very rapid changes in markets and technology.

To be sure, a move to the Manitoba Innovation Corridor will not be an easy one. Our institutions and culture will be difficult to change. Our industrial system is the product of historical processes that are not easily imitated or altered. However, the first step is for the community-at-large, and particularly our politicians, managers and policymakers to overcome their current view of the firm as a separate and self-sufficient entity. They need to recognize that innovation is a collective process as well as an individual one. Adopting a business model that breaks down the institutional and social boundaries that divide firms will represent a major challenge. One, however, that is decidedly less daunting than the challenges faced by other regions in Canada and the remainder of the world who are confronted with the same challenges as Manitobans are.

Ultimately, the mission of the Manitoba Innovation Corridor will be to "create a comparative advantage for Manitoba by building a collaborative, community network through transforming Manitoba from a province of entrepreneurs into an entrepreneurial province."

TOP

BACK

SERVICE	COST	DETAILS
Photocopying	.06 ea	up to 500 copies
	.04 ea	over 500 copies
Postage	regular postage plus 20%
Fax Machine	$20/month flat rate	long dist. charges added to monthly billing
Color LaserWriter Printouts	$1 ea	specify how many
Building Network/Internet Access	$20/month	must sign agreement
Email	$5ea/month	unlimited time when used within building
-Dial-in access from remote location	$2/hour
LaMINator	No fee	must provide your own supplies must be left in tenant services room
Binding Machine (Cerlox)	No fee	must provide your own supplies must be left in tenant services room
Boardroom/Meeting Rooms	No fee	first come first served
TV & VCR	No fee	for boardroom and office use ONLY first come first served
Slide Projector	No fee	for boardroom and office use ONLY first come first served
LCD Panel	No fee	must not leave ATC, no overnight rentals
- when using off-site	$100/day	$500 deposit and must sign a waiver
Overhead Projectors	No fee	first come first served must not leave ATC
10 cup Coffee Urns	$5 per fill and/or rental	we require at least two days notification
Regular SeMINars & Workshops	No fee	(up to $50 value per attendee)
A MINi-Library of Magazines	No fee
AdMINistrative Services	Has files of information and brochures, such as: Resumes, Hospitality information (catering services, hotels, etc.), various banking information and brochures, and more
Parking	No fee - Unlimited outside parking with power outlets.
Leasing Conditions	Based on a month to month
Janitorial Services	Include vacuuMINg and nightly garbage removal
Storage Space	Limited storage space available, we will do our best to accommodate
Security	Regular business hrs. are Monday to Friday, 7:45am to 5:00pm, otherwise an access card is required to enter the building
Signage	Each tenant is provided with a name plate (if company name changes special arrangements will have to be made)

	1		2		3	4	5
A) Access to high-speed bandwidth:	40%		10%		25%	10%	15%
B) Shared resources including servers, networks, printers:	25%		10%		23%	8%	18%
C) Access to financing (i.e. venture capital):	23%		28%		18%	8%	25%
D) Inexpensive floor space (i.e. lease rates):	38%		15%		18%	5%	23%
E) Co-tenants are in the same type of industry (i.e. high-tech):	28%		20%		18%	10%	15%
F) Ability to develop short-term partnerships with co-tenants:	40%		20%		20%	10%	10%
G) Access to skilled Labour pool:	0%		35%		15%	10%	33%
H) Access to industry professionals (accountants, lawyers):	15%		20%		28%	18%	15%
I) Strategic guidance on markets:	33%		20%		20%	18%	5%
J) Access to government initiatives (i.e. grants, funds):		30%		15%	13%	23%	13%
K) Support on reaching global marketsmarkets: markets:		33%		20%	15%	18%	13%