Marwa Nesma Ramy Tamer

British Manufacturer Survived and Prospered in this Market

Key Feature of success Providing a HI-FI Equipment that provide the best possible sound quality Why? HI-FI Market Segment relay on Quality more than Cost How? Embraced innovation in order to maintain their position in the market place

 Large # of HI-FI company in UK (not less than 45 based on May et al. 2001)

 They are relatively small (25 employee or less) Concentrated in South East of England being clustered in an arc that stretches from Cambridge through London and into Kent, Sussex, and Hampshire Unlike the Japanese Manufacture, British specialized in Hi-Fi Products:
Compact Audio System Amplifier Specialist Audio Product CD Players Loud speaker System

 Some British Manufacturers switched to Home Theater and Loudspeakers Systems Key Features was High End Audio Equipment rather than paying attention to the Modern display aids In spite of its small size, British Manufacturers are Very Active in their Innovations Significant Innovation such as Stereo Sound, Small book Shelf Speakers, and flat-Panel Loud Speakers were Introduced by Small British Companies

 1992/1993 and 1996/1997 European Images and Sound association ranked the British Companies on The Second Place after The Japanese Companies (according to May et al. 2001) in Terms of # of Awards Granted 1994/1995 and 1995/1997 Small British Companies received awarded approx. equal to what European Companies were granted Large Japanese Companies (such as Sony, Philips, Canon, etc.) Hired British firms as a Consultant Home Theater Award 2012/2013 earned by Bowers & Wilkins Audio Award 2012/2013 earned by Audiolab, DALI EPICON, KEF, etc.

 Flat Panel Loud Speaker Technology that Used by Japanese Companies were Developed by British Firm NXT Home Cinema Speaker System Used by Canon was Developed by Meridian

 Phonograph invented by Tomas Edison (American) 1877 Disk Phonograph , Vinyl Record Player Came From America When Marconi (Pioneer of Radio) Moved to Britain in the Early part of the Twentieth Century, British Companies gained some Interest in Audio technology Marconi Established his company Wireless and Telegraphy company at Chelmsford Near London

 A.D. Blumlein developed a Two Channel in Single Disk and Produce Stereo Recording
Alan Dower Blumlein (29 June 1903 7 June 1942) was an English electronics engineer, notable for his many inventions in telecommunications, sound recording, stereo, television and radar. He received 128 patents and was considered as one of the most significant engineers and inventors of his time

D.T.N Williamson and Harold Leak developed the Amplifier

 Formation of BBC (1920s) Setting up National Grid (1926s)

Withdraw interest to radio Provide trained engineer Open Market for wireless sets

These Two Publicly Funded Scheme developed a thriving Amateur Radio Community During the Interwar and after 1930s Many Small Hi-Fi Manufacturers were Established In1960s, Cluster of Small Companies Specialist in Hi-Fi manufacturers established a South East of England Government Invested Largely in Research in Radio and Associated Electronic Technology During the WW2 This Research was along with Research on Development of Radars

 This Collaboration Produced and Engineers how was trained in Armed Forces Some Of These Engineers developed Civilian Audio Product Ex. John Bowers and Ray Wilkins Have Founded B & W Loud Speakers in 1960s 1970s new companies were boosted as mass market consumer electronics firms (Thorn, EMI, GEC, Rank,etc.) AS some of these companies rationalized their activities in order to face the competition with Japan. Engineered and employee start spin off and start their new companies targeting new product and new services.

 Q1: What is the Evidence for suggesting that the British Hi-Fi industry constitutes a cluster?

Concentrated in South East of England being clustered in an arc that stretches from Cambridge through London and into Kent, Sussex, and Hampshire

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 Q2: How did British Hi-Fi cluster originate?

Formation of BBC (1920s) Setting up National Grid (1926s)

Withdraw interest to radio Provide trained engineer Open Market for wireless sets

These Two Publicly Funded Scheme developed a thriving Amateur Radio Community During the Interwar years and after 1930s Many Small Hi-Fi Manufacturers were Established In1960s, Cluster of Small Companies Specialist in Hi-Fi manufacturers established a South East of England Government Invested Largely in Research in Radio and Associated Electronic Technology During the WW2 This Research was along with Research on Development of Radars

 Q3: What are spin-off companies and what part did they play in the development of Britain`s hi-fi cluster? Setting up new firms/ own business focusing on a specialist field decided by employees of existing companies which spotted market niches for new products/services. Increasing the Spin off Companies, Developing a range of innovations in the fields, increase competition, Increase the Development of Britain`s hi-fi cluster

 Q4: What similarities, if any, are there between Silicon Valley and Britain`s hi-fi cluster in terms of the part played by public institutions in the development of the cluster? No similarities,
Silicon Valley: From the 1890s, Stanford University's leaders saw its mission as service to the West and shaped the school accordingly. At the same time, the firms focus on building self-sufficient indigenous local industry. Thus, regionalism helped align Stanford's interests with those of the area's high-tech firms for the Silicon Valley's development. Britain`s hi-fi cluster: The formation of the BBC in the 1920s not only fostered interest in radio, but also provided trained engineers. Similarly, another government initiative, the setting up of a the national gird in 1926, helped to open the market for wireless sets, by extending the provision of electricity to all parts of the UK and ensuring a common standard for electrical supply. Both of these publicly funded schemes contributed to the development of a thriving amateur radio community in Britain in the interwar years and after.

 Q5: Which of Markusen`s (1996) four types of cluster most appropriately applies to the British hi-fi industry in your view and why?
Based on the role of different cluster members and the interaction between them, Markusen (Markusen, 1996), has defined four models of clusters. 1. Marshallian cluster model 2. Hub-and-Spoke cluster model 3. Satellite Platform cluster model 4. State centered cluster model British hi-fi industry follows the Marshallian cluster model, in which the cluster is rather homogenous, comprising small firms that collaborate with each other, are in direct competition or in a supplier-producer relation. In this model, none of the firms has the size and the force to control directly the cluster and only the common market and the cluster dynamic define its shape and development.

Q6 What evidence is there that innovation is a feature of this cluster? Despite the late start Britian has in recent years it has been responsible for several major innovations in the field of audio technology. the phonograph was originally invented in US by Thomas Edisson in 1877 and also later improvements such as disc phonograph and forerunner of the vinyl-record player were also initiated in America however when Marconi the pioneer of radio moved to Britian in the early twentieth century he established the wireless and telegraphy company at Chelmsford near London. A.D Blumlein pioneered the early development of two channels on a single disc to produce stereo recording, DTN Williamson and Harlod Leak were responsible for the development of amplifiers . The setting up of the National Grid in 1926 helped to open the market for wireless sets. According to May et al.(2001) the amateur input to the industry in which a strong esprit de crops results from the hobbyist and amateur input to the industry In the second world war has been a big investment by the government in research into the radio and associated electronic technology. Much of this was connected with the development of Radar ,Designed to check the threat posed by Germany U-boats and aerial bombing by the luftwaffle

Q7 What evidence is there to suggest that the success of the hi-fi cluster is based on what Marshall (1890) terms agglomeration economies? For an industry, the benefits of locating in a densely peopled and highly industrialized situation. The market is large, but concentrated in a relatively small area. Transport costs are therefore low, so that many specialized industries can evolve, since local demand is sufficiently high. Further benefits arise because of functional linkages, and through external economies.; international links with other research institutions (MIT, for example); the research and development which can spin off from these; the high levels of skills in information technology; the infrastructure supplied by governments and utilities; and the brand name: Cambridge. This combination gives the city a powerful competitive advantage. Though the intensive competition from Japan , these large concerns rationalized so that skilled engineers left and set up their own businesses focusing on a specialist field of audio equipment which was pioneered by hi-fi clusters . the process of evermore specialized companies being spun-off in this way throughout 1980-1990 as employees of existing companies spotted market niches for new products and services and decided to set-up on their own, May et al. give the example of Myriad , manufacturer of amplifiers and tuners spun off from Ad electronics (which was itself established in the 1970 a manufacturer of similar products but aiming for a more

 Q8: If the British hi-fi industry cluster stretches from Cambridge to Hampshire (120 miles), is it feasible to describe this as an industrial agglomeration?
Concentrated in South east of England, Specialized in hi-fi industry, Easier mobility Lower transportation and communication cost
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 Q9: How valid is Martin and Sunleys (2003) critique of the cluster concept in this instance?
Martin and Sunley critique of the clusters: No rules on how strong linkage needed to be among industries, and the geographical concentration that a cluster require. Here, the linkage of the hi-fi companies are very strong, and its geographical concentration in the south east of England makes it a best describe for a cluster

 Q10: Martin and Sunley (2003) suggest that one of the weaknesses of the cluster concept is the extent to which policy-makers have uncritically endorsed the concept how valid is that criticism in this instance?
Specializing in hi-fi industry, and Geographical concentration, as well as The global competition of these companies, and local needs for them (Radio and BBC,..etc) makes this cluster as essential to success in the global and local economy.