Côte d Azur: Anchoring its leading position
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1 Digital Transformation Monitor Côte d Azur: Anchoring its leading position January 2017 Internal Market, Industry, Entrepreneurship and SMEs
2 Côte d Azur: anchoring its leading position Leonid Andronov/Shutterstock.com The Côte d Azur is often seen as a global leader in the use of Information and Communication Technologies (ICTs). Yet, its status has recently been jeopardized. In , Côte d Azur witnessed the departure of a series of global leading tech companies, such as Texas Instruments and Samsung. The region became suddenly confronted to a shortage of digital talents as the firms exit also meant losing their high-profile employees. Although Texas Instruments and Samsung were soon replaced by other large companies e.g. Intel and Huawei, their departure has reinforced the need to develop forward-looking policies, responsive to a fast-paced digital territory. 1 Problem statement Over the past decade, the Métropole Nice Cote d Azur has become a global leader in the use of Information and Communication Technologies (ICTs). The Métropole Nice Cote d Azur successfully shifted from a servicebased economy relying heavily on tourism to an increasingly diversified economy putting a great emphasis on KETs. Departure of leading tech companies challenges the Métropole The impact of digital transformation on the economy of the Métropole Nice Cote d Azur could have been slowed down by the departure of globally leading tech companies from the Metropolitan area. However, it also opened a wave of opportunity to welcome new global players. In 2013, the closure of Texas Instrument was followed by the departure of Samsung only 3 years after the implantation of its R&D centre in Sophia Antipolis. The wave of relocations recently reached a peak after the announcement of the impending closure of the R&D centre of NVIDIA in Sophia Antipolis, only few years after its set-up in the city. Recovering from the loss of multinational companies The Métropole Nice Cote d Azur is still recovering from the disruption caused by the loss of the high-profile corporate residents. The reason these tech companies are exiting is mainly due to strategic decisions that led to far-reaching internal restructuring. For instance, in the case of Texas Instruments, the failure to make the digital shift was clearly the main culprit. If the attractiveness of the metropolis was not questioned, the departures of these companies reinforced the need for forwardlooking local policies, responsive to a fast-paced digital territory. Figure 1: Métropole Cote d Azur Source: Team Côte d Azur 1 Successfully retaining the local talents The local strategy to cope with the departure of these high profile corporations focused on the retention of local talents. Those highly-skilled workers are perceived as the backbone of the region s economy and the key enablers of the digital transformation of local businesses. In 2013, the launch of a job protection plan enabled Samsung to take over the laid off employees of Texas Instruments. With the departure of the leading Korean mobile telephone manufacturer, another employment preservation plan was created and the 110 laid off engineers were hired by the American company Intel and the Chinese company Huawei (that had recently opened its R&D site in Sophia-Antipolis). A digital strategy to remain attractive for multinational companies The digital strategy of the Métropole Nice Cote d Azur aims to set the metropolis as the ultimate destination for companies seeking to invest in the fields of excellence of the territory. 2
3 Côte d Azur: anchoring its leading position Over the past decades, the metropolis has become a European leader in ICT, biotechnologies, e- tourism, e-energy and the silver economy. The priority given to the digital transformation of businesses is reflected by the multiple partnerships between the actors of the digital ecosystem which have spawned new initiatives, experiments and innovations. Over 800 foreign-owned companies, accounting for more than 13,000 jobs have located to the Nice basin and the Plaine du Var area.² Smart investments The metropolis has emerged as a pioneer in the Smart Grids and Smart Cities sector. These successes were made possible thanks to the leadership of the local government who gathered all the stakeholders of the digital ecosystem to create a shared vision of territory s digital strategy. 2 Realised benefits and new opportunities A world leading ecosystem Nice s position in international rankings reflects that the Métropole is a leading digital ecosystem. Nice is the 4th Smart City in the world according to Juniper Research s 2015 report 3. The city was also the Winner of IBM s 2011 Smarter City Challenge 4. At the national stage, the Métropole Nice Cote d Azur formed part of the first territories to be awarded the French Tech label 5. If the Métropole Nice Cote d Azur can benefit from the presence of digital champions, the digital transformation of a higher share of SMEs could bring about more sustainable economic growth and prosperity in the metropolis. A digitally advanced territory In 2011, the ICT Observatory of the Provence Alpes Cotes d Azur (PACA) region conducted a survey on the ICT use of regional SMEs. Survey results indicate that the purchase of equipment and the creation of websites are the most frequent types of investments in ICT made by regional SMEs (accounting for 46% and 11% of SMEs investments respectively). With respect to new digital technologies, only 26% of regional SMEs have declared themselves ready to use cloud computing services and 18% of SMEs are using social networks. 6 Benefits of the ICT sector in Cote d Azur EUR 4 bn in revenue, 55% in exports, 9,000 jobs, 2,500 dedicated to R&D 7 Figure 2: Network of accelerators and incubators form an extended and vibrant ecosystem Source: Team Côte d Azur 1 Figure 3: Internet use by SMEs in the PACA region [%] Source: PACA ICT Observatory The positive impact of the ICT industry Digital technologies have the capacity to increase SMEs ability to innovate and drive economic growth in the Métropole Nice Cote d Azur. The sector of ICT already represents 1,710 companies accounting for 21,775 jobs in the Cote d Azur. Over the past decade, about 9,000 jobs were created in the sector which brought over EUR 4 billion in revenue. The digital transformation of a higher share of businesses is, therefore, poised to have a broad impact on the economy of the metropolis. 3
4 Côte d Azur: anchoring its leading position 3 Drivers and obstacles A Drivers Key stakeholders Métropole Nice Cote d Azur acts as facilitator The Métropole Nice Cote d'azur plays the role of facilitator in the digital ecosystem. University of Nice Sophia Antipolis acts as enabler The University of Nice Sophia Antipolis represents a key enabler of the digital transformation. The university educates the talents that will enable the digital transformation of local businesses. In addition, the involvement of the university in numerous industryacademia collaborations also reinforces its role as an enabler of digital transformation. Local businesses act as driving forces Local technology businesses constitute the driving force behind the digital transformation of traditional companies. Since 2009, Intel set its flag in the metropolis. In doing so, Intel joined other global giants such as Gemalto, ARM, STMicroelectronics and Maxim Integrated Products. Leading SMEs such as RivieraWaves, EASII IC, ASIC Design House, Electronic Design Centre and even Scaleo-Chip drive the digital ecosystem notably as they are at the origin of the creation of several digital disruptions. Intermediary organisations and clusters provide strategic support Intermediary organisations and clusters such as The Sophia Antipolis-based Secured Communicating Solutions (SCS) Cluster are providing strategic support and guidance to local firms and therefore act as key drivers for the digital transformation. 8 Key initiatives Provision of Open data Portals enables citizen-centred innovation The launch of an Open Data Portal marks a reference point in the digital agenda of the Métropole Nice Cote d'azur. The Open Data Portal provides a wide variety of cultural, sport, administrative and environmental datasets related to the territory Nice Côte d'azur. 9 startupstockphotos.com/pexels.com The portal complies with the European DCAT (Data Catalogue Vocabulary) standard for data catalogues interoperability which facilitates the access for regional businesses. The Métropole Nice Cote d'azur has organised different workshops (notably during the annual Innovative City conference) in order to gather the insights of local citizens and businesses on their data needs. The aim of these workshop was to identify optimal services which would bring added value to the Open Data Portal. 4
5 Côte d Azur: anchoring its leading position The new egional Campus of Learning: moving towards academic excellence The new Regional Campus of Learning stands out as a reference point in the academic community. The 24,000m² campus will open in 2017 and will welcome 1,800 learners at the heart of the "Eco- Valley" of the Métropole Nice Côte d Azur. 10 The objective of the new campus is clear: Ensuring young people have the required skillset to meet the current and future needs of regional businesses. The campus aims to prepare students for the occupations of the future by orienting its courses towards tech sectors and promising fields with high potential for growth in Cote d'azur. Overall, EUR 83 million will be invested to build the campus. The project benefits from public funding made available by the national, regional and local governments as well as the Chamber of Commerce and the PIA (Programme d'investissements d'avenir- Investments for the Future Programme) of the national government. 11 University of Nice Sophia Antipolis: offering an innovative approach to education The University of Nice Sophia Antipolis is the second largest multidisciplinary university in France. The university has developed a new concept and strategy to gather all the Côte d Azur higher education components under the umbrella of University of Côte d Azur. University of Nice Sophia Antipolis: an institution dedicated to the generation of new digital talent The University of Nice Sophia Antipolis also aims to strengthen its digital competence in order to attract internet-savvy students and researchers from all around the world. Through the reinforcement of its digital focus, the university strives to provide students with the right skillset to facilitate their educationto-employment path. For instance, the university recently joined the EIT Digital Master School initiative and created a partnership with 5 top European universities (EIT ICT Labs) to deliver a master degree in "data science. 12 Building on these insights, it comes at no surprise that the University of Sophia Antipolis is commonly referred to as being highly dedicated to the training of the digital innovators and entrepreneurs of tomorrow. Numerous incubators and accelerators driving digital transformation The Métropole Nice Cote d'azur hosts 9 incubators and 3 accelerators. The incubators include: PACA Est Incubator; Business Pole Sophia Antipolis; CEEI Nice Côte d Azur; 27Delvalle; PEPITE; Inkubateur; SKEMA Business School incubator; ParisTech Entrepreneurs; EYE of EDHEC. All these organisations participate in the digital transformation strategy of the territory. Company-led accelerators complementing the role of local incubators The added value of the Métropole Nice Côte d'azur lies in the existence of company-led accelerators such as: the accelerator of the global insurance company Allian, Vinci Autoroutes (which designs, builds, finances and operates motorways in France); the future "Village" accelerator of the French bank Credit Agricole. The regional campus of Learning will enable regional businesses to find the right talents Jacques Lesieur, CEO, Team Cote d'azur A myriad of Fab Labs making Métropole Nice Cote d'azur a true FabTerritory The Métropole Nice Cote d'azur already includes no less than 4 Fab Labs: Based in Sophia Antipolis, SoFab is a Fab Lab located at the heart of the Sophia Tech campus; Ecolab is the brand new Fab Lab of the CEEI, the main incubator of the Métropole Nice Côte d Azur. It gives access to digital and technological tools to makers, start-ups and the general public, and supports open innovation in the territory; The Refabrique is a personal Fab Lab created by a Cannes resident opening up access to his own digital tools to "makers" who cannot find them in the region. The Refabrique is a prime example of a citizen initiative supporting the digital transformation of local businesses; The NavLab of the Métropole Nice Cote d'azur illustrates the adaptation of the Fab Lab concept to meet the needs of the professionals in the sailing industry, a leading sector of the territory. The NavLab or "Navigateur" Lab (SailorLab) offers a co-working space and a meeting point for sailors, entrepreneurs and creative artists of the French Riviera. Regional Campus of Learning EUR 83 million invested into a 24,000m 2 campus for 1,800 learners 5
6 Côte d Azur: anchoring its leading position Key infrastructures Learning infrastructures oriented towards digital technologies The Learning Centre located at the heart of the SophiaTech campus stands out as the new Library 2.0. The new Learning Centre which was inaugurated in January 2015 offers innovative and customised services to its target audience made up of students, teachers, researchers, start-ups and clusters. 13 More than a university library The learning centre provides a unique environment facilitating the collaboration between the academic and business world. This meeting point includes various facilities and co-working areas aimed at spurring innovation on the campus. "The Learning centre is an individual, collective and multipurpose working space. - Frederique Vidal, President of the University Nice Sophia Antipolis It includes: Showroom space: 125m² dedicated to exhibitions and to the promotion of the scientific work; Businesses space: 245 m² equipped with digital educational resources (e.g. SMART Board), coworking spaces; The location of SATT South-East (Tech transfer accelerator) and KIC ICT Lab (Knowledge and Innovation Communities) on the Learning Centre aims to deepen the connections with regional businesses. Learning centre of the SophiaTech Campus 125m² showroom space; 245m² business space. B Obstacles MarinaDa/Shutterstock.com Promoting local talents, not factories or businesses Some local or national governments focus too much on the promotion of headquarter offices, factory facilities or campus buildings rather than on the promotion of local talents. During the restructuring strategies of companies, public authorities should concentrate their efforts on the retention of regional talents in the territory. Cote d Azur benefits from a pool of universities which offer the region a continuous stream of a highly educated workforce. The region should, thus, shed a great focus on this human capital by incentivising talents which are newly joining the workforce to enjoy the full range of business opportunities in the region, leveraging on its recognised quality of life. 6
7 Côte d Azur: anchoring its leading position 4 Lessons Learnt A forward-looking strategy and a shared vision of the future businesses Creation of the SophiaTech Campus as a case in point The creation of the SophiaTech Campus is a prime illustration of such a strategy. Opened in 2012, the campus creates synergies between the research laboratories of the territory: INRIA Méditerranée; The existence of a shared vision of the future among local stakeholders is a precondition for the success of any digital transformation strategy. LEAT CNRS/University laboratory of electronics, antennae and telecommunications); In Nice, an advisory board gathers representatives from local businesses and is led by the president of Amadeus, the global IT company. This advisory board was created by the economic development agency Team Cote d Azur to keep pace with the latest technological advances likely to have an impact on the local economy.14 the Nice Sophia Antipolis University; engineering schools. This forward-looking approach enables local governments to adapt their digital transformation strategies prospectively, a must-have given the complexity of the digital economy and its potential market disruption. The role of universities: providing the right skills to enable the digital transformation The digital transformation of a territory is only possible if local businesses have the right talents to harness the required digital technologies. In order to equip students with the skills needed by local businesses, universities must not only have an accurate understanding of the skills required by local companies but they also need to be able to provide students with these required competencies. In this regard, universities sometimes need to acquire or reinforce their expertise in particular areas. Strategies to implement the required changes include, for instance, the creation of partnerships with other academic institutions already renowned in the sought-after sector. The fruitful collaboration enables the training of engineers in the fields of excellence of the territory such as research networks, security and mobile communications. E-government activities as a driver for digital transformation In the Provence Alpes Cote d Azur region, one out of two SMEs use egovernment services for tax declarations. If the primary purpose of e-government activities is to improve the efficiency of government-business interactions, these online services also have demonstration effects for local firms and especially for SMEs. For many companies, e-government activities constitute a model for online service delivery providing companies with new incentives to trust the security of online transactions. Monitoring instruments are essential to the success of any digital transformation strategy The creation of the IC Observatory Ob TIC in the region PACA serves as a best practice example of an initiative that enables policy makers to track the progress of their digital transformation strategy. The performance of a survey on ICT use at citizen, firm and local government levels constitutes an effective way to collect Key Performance Indicators on the digital transformation of the whole territory. 7
8 Côte d Azur: anchoring its leading position 5 Key Recommendations Category Local government Universities/ Research centres Businesses Clusters Incubators/ Accelerators 8 Role of the stakeholder Develop a territorial digital transformation strategy in collaboration with neighbouring localities Engage key stakeholders in long-term partnerships and build trust relationship between them (e.g. through the organisation of regular local meetings) Facilitate collaboration and cross-fertilisation between different industries and sectors Invest in key infrastructures for a business-friendly environment such as smart transport infrastructures, business offices, academic buildings Develop open data platforms Design strategies to retain local talents Strengthen your digital competences (e.g. by seeking support from local tech champions) Develop institutional strategies for capacity building Retain and attract talents Be proactive in the creation of a digital ecosystem around the university Collaborate with other stakeholders from the digital ecosystem Innovate, create and apply digital technologies Inform key stakeholders about your needs and seek for assistance when necessary Gain a deep understanding of your businesses Inform local stakeholders about the strengths and needs of your businesses Organise regular meetings with other clusters and local businesses Provide inspiration, support and-stimulation to local businesses Connect businesses with relevant stakeholders to enable their digital transformation Provide spaces for people to meet and open space for cross-fertilization Create synergies between the actions of the different accelerators and incubators of the territory
9 Côte d Azur: anchoring its leading position References ¹ Team Côte d Azur, ² Team Côte d Azur, Nice Côte d Azur and Éco-vallée Plaine du Var Why choose between quality of life and business?, 2016, available at: 3 Juniper Research, Global Smart City 2015, 2015, available at: 4 IBM, Smarter Cities Challenge - Nice Côte d Azur, 2011, available at: 5 Team Côte d Azur, Attracting Investments in the CÔTE D AZUR: ANNUAL REVIEW 2015, available at: 6 Région Provence-Alpes-Côte d Azur, Observation de la diffusion et des usages des Technologies de l Information et de la communication en ProvenceAlpes-Côte d Azur, 2011, Available at: ales.html?jumpurl=uploads%2fmedia% 2Fetude_com_obtic_barometre_2011_04 15_03.pdf 7 Team Côte d Azur, côte d Azur: Join the digital elite, 2015, available at: 8 Guillame Roux, Secured Communicating Solutions Cluster, 2015, available at: 9 Open Data Nice Côte d Azur, 10 CESi, Campus Regional Apprentissage : La CCI Nice Côte d'azur, le CESI et l'université Nice Sophia Antipolis lancent le volet pédagogique», available at: 11 French Senate, Projet de campus régional d'apprentissage Nice-Côte-d'Azur», 2014: available at: 12 EIT Digital, 13 Nice Sophia Antipolis University, Learning Centre SophiaTech, available at: 14 Team Côte d Azur, L attraction d investissements sur la côte d azur en 2013, 2014, Available at: s/rapport_annuel_team_cote_d_azur_201 9
10 About the Digital Transformation Monitor The Digital Transformation Monitor aims to foster the knowledge base on the state of play and evolution of digital transformation in Europe. The site provides a monitoring mechanism to examine key trends in digital transformation. It offers a unique insight into statistics and initiatives to support digital transformation, as well as reports on key industrial and technological opportunities, challenges and policy initiatives related to digital transformation. Web page: This report was prepared for the European Commission, Directorate-General Internal Market, Industry, Entrepreneurship and SMEs; Directorate F: Innovation and Advanced Manufacturing; Unit F/3 KETs, Digital Manufacturing and Interoperability by the consortium composed of PwC, CARSA, IDATE and ESN, under the contract Digital Entrepreneurship Monitor (EASME/COSME/2014/004) Authors: Laurent Probst, Bertrand Pedersen & Olivia-Kelly Lonkeu, PwC DISCLAIMER The information and views set out in this publication are those of the author(s) and should not be considered as the official opinions or statements of the European Commission. The Commission does not guarantee the accuracy of the data included in this publication. Neither the Commission nor any person acting on the Commission s behalf may be held responsible for the use which might be made of the information contained in this publication European Union. All rights reserved.
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