When American author Michael Porter first introduced the notion of ‘cluster’ in 1990 in his book The Competitive Advantage of Nations, he viewed the agglomeration of companies — whether geographical or merely through collaboration — as essential to increasing productivity, driving innovation and encouraging new businesses in the field. Fast forward 22 years and Beirut-based incubator Berytech is attempting to launch, on its own, a local version of a cluster for Lebanese companies in the information communication technology (ICT) sector.
Financially supported by the European Union, Berytech’s efforts to launch the cluster began in 2011 after tasking Salim Tannous, a media consultant, with finding the ICT companies that would eventually become the members of the cluster. “Most company owners said ‘leave us alone, we don’t have time’; they associated [this initiative] with a PR stunt so the first obstacle was to get their trust,” says Tannous.
Cooperation for free
After lengthy negotiations, meetings and workshops to show companies how a cluster would benefit them, 25 companies joined and a board of directors was appointed in August 2012 made up of seven members. The cluster’s goal is to get companies to collaborate, share knowledge, partner and develop the ICT industry in Lebanon. Dubbed the Beirut Creative Cluster (BCC), the aim is to bring these companies closer together through round tables, workshops and other events. “Instead of going to Europe and finding a partner there to work with, they can find one in Lebanon,” says Tannous. An open club, the cluster aims on adding more members but wants to put in place a structure before doing so, in order not to disrupt the dynamic.
With no membership fee, the cluster is entirely funded by Berytech for now. Tannous refused to disclose the cost of the initiative, only saying, “it is not a lot”. Eventually, the board members will decide when it will start charging annual membership fees, similar to their international counterparts. The Bulgarian software cluster BASSCOM in Sofia, for example, charges its 45 members an annual 600 euro ($790) membership fee.
The BCC also differs from its counterparts in developed economies by not having government support or research and development centers underpinning the cluster. In developed economies, triple helix clusters bringing together government, industry and academia are common. The Innovation Alliance on Lithium-Ion Battery in Germany — which works to secure high-powered lithium-ion-based energy storage systems — has 60 partners from political, industrial, scientific and research fields on board and is 15 percent funded by the government (roughly $78.9 million) and 85 percent by the private sector (roughly $474 million). “Here in Lebanon, [the government] prefers to see a winning horse before they bet on it,” says Tannous. As for academia, the BCC is already communicating with Saint Joseph University — given Berytech’s founders hailed from the university — and plans to begin talks with the Lebanese American University soon.
On the drawing board
First and foremost, in the upcoming months the BCC aims to help members of its cluster to join fairs organized in developed markets. On the top of its agenda is the MIPCube, a creative platform forum that will be held in Cannes in April 2013. Tannous is preparing to have the members attend the fair at a fraction of the cost by searching for sponsors, such as the Investment Development Authority of Lebanon (IDAL) and requesting a discount from the organizers of the fair “keen on encouraging companies from the Middle East.”
The BCC also plans to organize workshops such as a cross media workshop to educate companies in the ICT industry on how to sell their content across different media platforms, with the target of holding the event within three months. “A screenwriter with an idea for a film thinks about the movie and how it will be projected on a theatre screen and that’s it,” says Tannous. “We want to help them think of the story as trans-media, exploitable on movie screens, TV, tablets… on how to monetize the story.”
Last month, the BCC and Foundation Liban Cinema, an association helping the development of Lebanon’s cinema industry, planned a script-writing workshop, in collaboration with the French Institute and the European Union Delegation in Lebanon, whereby Lebanese and French script-writing experts provided advice to up-and-coming scriptwriters. A follow-up session is planned in six months.
With a European Bronze Label for Cluster Management Excellence awarded to the BCC at the 15th Competitiveness Institute held at San Sebastian in October 2012, Tannous has big ambitions for the cluster going into 2013. His target by the end of the year? “For more members to want to join, for Berytech to stop supporting it and for the cluster to fly on its own,” says Tannous.
