The Clustering of Broadcasting Firms and its Significance in London
Funded by The British Academy (2003-04)
Grant Holders: Gary Cook and Naresh Pandit
The phenomenon of industrial clustering has recently become the subject of intense interest in academic (Fujita, Krugman and Venables, 1999; Martin and Sunley, 2003; Porter, 1998; Saxenian, 1994; Swann et al., 1998) business practitioner (The Economist, 1999; Owen, 1999) and government policy (DTI White Paper, 1998) circles. A cluster may be defined as a geographically concentrated group of competing, collaborating and interdependent firms and institutions connected by a system of market and non-market links. Important high-technology manufacturing clusters include the Silicon Valley (microelectronics) and Cambridge (biotechnology).
A series of statistical studies which use a common methodology, and therefore allow comparisons to be made, suggest that the benefits of clustering in service industries can be very similar to those found in high technology manufacturing industries. These studies (Beaudry et al., 1998; Cook et al., 2001, Pandit et al., 2001, Pandit et al., 2002, Swann et al., 1998) have investigated the dynamics of industrial clustering in three high technology manufacturing industries, computing, biotechnology and aerospace and two service industries, broadcasting and financial services. They provide a useful "bird's-eye view" of clustering and economic performance, but do not model the details of what happens inside a cluster and so do not tell us much about the processes by which clustering effects work nor the contextual factors that initiate and sustain such processes.
Two further studies have provided this type of extension for the UK financial services industry (Pandit and Cook, 2003, Taylor et al., 2003) particularly that located in and around London. The proposed research will replicate part of the Taylor et al. (2003) study of clustering in financial services in the City for broadcasting in Soho and surrounding areas. The study will also complement a recently completed comparative study of clustering in the British broadcasting and financial services industries. This ESRC-funded study looked at three city-regions of the UK, including London, for both industries. Where the proposed questionnaire survey will complement this interview-based survey is in providing important quantification of the density of interaction between firms and the aspects of location in compact geographical space which are particularly helpful or disadvantageous for firms. Once this research programme is complete the research team will have generated a body of work which provides a unique and comprehensive comparative analysis of two of the UK’s most important clusters.
The study poses the following research questions:
(1) What are the principal advantages and disadvantages of a central London location?
(2) What is the nature of relationships between sub-sectors of the London broadcasting cluster?
(3) How does geographical proximity confer competitive advantage to London broadcasting companies?
(4) How is the flexibility and scope of the London labour market in broadcasting enhanced by geographical concentration?
Following the methodology successfully implemented in Taylor et al. (2003), a postal questionnaire will be sent to a sample of 1500 broadcasting companies (the same number as in the financial services study), including freelance operators and companies in related activities such as advertising (a copy of the London financial services questionnaire is attached which will require modest adaptation for use in the broadcasting industry). The sample will random and stratified in terms of firm size, location and line of activity (e.g., broadcasting; programme production; production facilities; post-production facilities; animation; graphic design; agents and casting; equipment hire; lighting; props and model making; music; sales and distribution; financial services (including accounting and insurance); research services; set construction; advertising; professional bodies; education and training; information technology). The questionnaire will be piloted with 6 respondents in early September 2003.
A sampling frame will be constructed using existing databases which have been developed using Lotus OneSource, FAME and Market Locations data. These databases will be amalgamated and updated using the Production Guide (the key trade directory for the broadcasting industry). Firms will be included which lie within a 500 metre buffer of the "square mile" of Soho and also some firms in Clerkenwell and Hoxton to which firms have gravitated in recent years. Some major firms (notably the BBC) which lie outside this area will also be included. This is cognate with the sampling strategy in the study of financial services in the City which used a 500 metre buffer around the traditional square mile and also surveyed firms in Canary Wharf. Questionnaires will be directed to managing directors, by name where available.
The first mailing will go out in October 2003 with a follow-up mailing in December 2003. An additional e-mail follow-up will be undertaken for the largest firms in the sample. Our experience of the London financial services study indicates that a 20% response rate is achievable.
As in the previous study, questionnaire data will be entered into SPSS for Windows where a number of statistical analyses will be performed, principally using non-parametric methods. These analyses will be driven by the following research questions as outlined above (see the London financial services report available at http://www.cityoflondon.gov.uk/business_city/research_statistics/research_publications.htm for further details). This analysis will be completed within three months of the end of the survey (March 2004 to allow for late returns). Incorporating sufficient time to write up results the project will end at 31 July 2004.
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