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Canada 3.0 Blog

Wednesday, April 22, 2009

Digital Stickiness

Countries around the world have made substantial investments in the digital media sectors. Governments have supported college and university training, academic research, commercialization initiatives and financing for start-up firms. There is a widespread assumption that digital media developments - hardware, software,c ontent and service delivery - will be central to national economic success in the coming decades.

The problem with this scenario is very simple. With dozens of countries competing on the same space, there is global competition for top talent, entrepreneurs, patentable and commercializable and emerging companies. Tie this to the mobility of people, ideas and even companies and the world ends up with both a vibrant global network of digital development and intense struggles to maintain commercial success.

For a country or a region, the "stickiness" of digital innovation has become a crucial - but rarely openly discussed - consideration. The issue is easy to describe. Stickiness is determined by the ability to attract, retain and develop key individuals, ideas and companies. Keeping all of these makes the economy strong and supports innovation. Conversely, if large numbers of crucial personnel, commercializable items and new firms move out of the region or country, then stickiness is deemed to be low and the economy is weakened accordingly.

At present, most governments focus their programs and energy on inputs, on producing more digital talent, developing more products and launching more companies. Some nations - Japan, South Korea, Singapre, Finland among them - keep almost all of their digital media investments in the country. A few, like Taiwan and China, are offering generous incentives to get people and companies to come home. Others, like those in Africa, lose many talented people and other digital assets from the country. The United States, in contrast, has historically attracted a great deal of foreign talent, capital and commercializable ideas.

Canada does not well on the scales of digital stickiness. Hundreds of our highly trained digital students accept jobs in the United States or elsewhere. Few comeback. There is a much larger market for digital innovations outside the country than inside. Many entrepreneurs have found much greener pastures south of the border. And a distressing number of start-ups relocate to the USA, often to get access to the much more plentiful venture capital pools.

Digital stickiness gets too little attention in the regional and national discussions about the development of the new economy. The focus on input elements is laudable, but there are serious problems here. The bleeding of digital assets from the country makes some individuals wealthier, enriches other countries and supports the global digital industry. What it also does is strip key human resources from the sponsoring region or country and undermine local commercial development.

For better or worse, Canada has a weak hold on its citizens, makes virtually no effort to convince people to stay, and makes it easy for even government-supported companies to leave. Our level of digital stickiness is higher than African nations but much lower than the most digitally-innovative countries in the world.

Canada needs a new vocabulary and a new agenda around digital media. Our students should be strongly encouraged to stay in Canada after graduation. Start-up companies should be supported in their efforts to make the transition from start-up to viable and long-term successful firms. Companies getting government funding to develop their products and services should have obligations to make a commitment to Canada and the host region.

To succeed in the globally competitive digital media economy, Canadians, Canadian firms and Canadian governments have to make a stronger commitment to their home region and country. We are competing against countries that expect a passionate loyalty to the nation from their digital sector. Canada competes very favourably on digital inputs; the country lines up much less impressively on the carry-through and permanent commitment. Stickiness has to be come a key priority if Canada expects to keep up with its international competitors.

Ken Coates
Dean, Faculty of Arts
University of Waterloo

1 comment:

  1. Hi, very interesting topic and definition of Digital Stickiness... you can visit my blog: Digital stickiness at, for me digital stickiness is related to how digital is a person and how the use of the new technologies makes people more productive...