When discussing the international robotics industry, it is common to classify markets based on their geographic locality. The number of companies, research institutions, businesses and investment groups supporting local robotics communities provide further differentiation.
On this basis, the robotics industry is typically subdivided into seven different major markets, and a number of smaller, complementary markets. These seven markets are either pan national or limited to a single country. The North American and European markets represent the former group, with Japan, Korea, China, India and Australia making up the remainder of the seven. A shared social history, geographic contiguity, a common central banking system and sheer population size are the key market qualifiers.
While it is possible to make broad brush generalizations regarding these markets, for example Australia is a leader in field robotics, as the robotics industry has grown and proliferated, such generalizations are no longer supported by the facts.
Within each of these major geographic robotics markets can be found distinct, sectorial robotics clusters. The concept of an industry cluster, first introduced by Harvard Business School professor Michael Porter in his 1990 book The Competitive Advantage of Nations (although there were conceptual antecedents, as well as many follow-on books and articles), refers to a collection of similar firms within a defined geographic area that that are related to each other by way of shared markets, technologies and worker skill requirements. Cluster members also partner with local universities, research centers, investors, and economic development groups.
It is common for a few select universities and companies to act as a cluster anchors. In the robotics space, for example, the Massachusetts Institute of Technology (MIT) and Carnegie Mellon University (CMU) act as the academic anchors for the Boston and Pittsburgh robotics clusters, respectively.
iRobot, which was founded by MIT roboticists, provides commercial anchorage for the Boston cluster. Similarly, Toyota and Mitsubishi Heavy Industries are the twin corporate pillars of Japan?s Nagoya cluster, while ABB and Volvo lend their support Sweden?s Robotdalen initiative.
Examples of robotics industry clusters include (this is not an exhaustive list so please hold the Emails):
- Boston, USA
- Pittsburgh, USA
- San Francisco-San Jose (Silicon Valley), USA
- Paris, France
- Munich, Germany
- Odense, Denmark
- Sweden (Robotdalen)
- Tokyo Japan
- Osaka, Japan
- Nagoya, Japan
- Seoul, Korea
Cluster synergies act to drive business for cluster members and spur overall market sector growth. Moreover, cluster development has the added advantage of promoting local, non-cluster, businesses services providers such as such as legal and accounting firms, public relations companies, talent search agencies, and media companies.
Location, Location, Location
Even in an era of rapid globalization, regional business agglomeration enhances the economic performance for all local members concerned, even as they compete across the world stage. The world might be flat and fully networked, but locality still matters? maybe more than ever. By interconnecting locally, cluster members can better compete globally.
It is for this reason that businesses, national and local governments, and economic development groups of all sizes ? from cities to large geographic regions ? proactively establish clusters, seed them with funds and provide other support.
At one time, business and technology clusters developed organically. Private sector companies partnered with local universities and research centers, and used government research funding to drive innovation and ultimately produce products. Today, cluster development is a top-down, planned and proactive affair. The stakes are simply too high for it to be otherwise. Most formal clusters are non-profit, although this too is changing (the profit motive is a great motivator).
For producers of robotics and intelligent systems technology the message is clear. Joining or forming a robotics industry cluster improves the chances of commercial success. The same holds for other classes of industry associations and business development groups. However, with clusters, it is location that is key. Companies based in outlying areas should consider relocating to cluster centers. Those companies located in cluster areas that are not engaged with cluster initiatives are doing themselves a severe disservice.
Technology in the Heartland
In the United States, three robotics clusters are preeminent ? Boston, Pittsburgh, and Silicon Valley, with Detroit, Atlanta, Los Angeles, greater Utah emerging. A relatively new robotics cluster is also under development in Minnesota, in the Minneapolis metro area.
I imagine that for many Minneapolis does not come to immediately mind as a robotics, or even technology, power center. The City of Lakes lies somewhere in flyover land while taking the high tech redeye from San Jose to Boston.
It is the home of Prince and long suffering baseball fans whose Minnesota Twins have been described by locals as ?the best farm team in baseball? (ouch!).
The facts, however, paint a much different picture. The Minneapolis/Saint Paul metropolitan area is the 16th largest in the US, falling between that of Boston (10th largest) and Pittsburgh (22nd largest).
Nine Fortune 500 companies are headquartered in the region, the 5th highest concentration among US cities (After New York, Houston, Dallas, and Atlanta).
More importantly, from a robotics standpoint Minneapolis/Saint Paul is a leader in fields that are highly synergistic with robotics including medical technology (Medtronic based there), advanced manufacturing (strong in defense), and information technology (IT). It was not by chance that the 2012 International Conference on Robotics and Automation (ICRA) was held in the Twin Cities.
A New Cluster Forms
The Minneapolis robotics cluster is driven by two closely related initiatives. The first is the non-profit Robotics Alley, a business development initiative designed to ?spur public-private partnerships in the business, research and development of world-leading robotics and automation systems.? Robotics Alley was founded by ReconRobotics, a developer of small reconnaissance robots for the defense, law enforcement and first responder markets, and the Minnesota High Tech Association, a regional business development group comprised of over 350 technology companies, investment groups, educational institutions and other organizations. The group is headed by Executive Director Andrew Borene, who is also Director of Corporate Business Development and Government Relations for ReconRobotics. In addition to the typical business development outreach programs, Robotics Alley produces a yearly robotics conference.
The Minneapolis cluster is also supported by the Global Robotics Innovation Park (GRIP). According to the their website, GRIP ?will be a mixed-use real estate development project containing light industrial, office and laboratory facilities for high tech research, development, testing and evaluation of robotic, autonomous and intelligent systems, and related business incubation, classroom and event space.? GRIP, which is a for-profit company, is currently in the process of selecting a site. The group is headed up by Nena Street, an attorney with a background in government contracting and real estate development.
In addition to Robotics Alley and GRIP, the Minnesota cluster is buoyed by robotics companies such as PaR Systems, NPC Robotics, MICROMO, Recon Robotics and others. The Minnesota Science and Technology Authority and Minnesota High Tech Association act as the business development anchors for the cluster, while the University of Minnesota is the cluster?s academic leader.
Past the Next, Next-Big-Thing
For decades, robotics and intelligent systems has been viewed as the next, next-big-thing.
Studies were made and pronouncements issued, but with the exception of the industrial robotics sector, the anticipated market revolution fell far short of reality (just review past market research reports). The expectations lag, however, is now over. The robotics industry ? consumer, service and industrial ? has now reached the inflection point predicted decades past.
The boom has arrived full force. Businesses, national and local governments, and economic development groups understand this. As a result, robotics innovation clusters of all types are forming and growing, both organically and through more formalized processes.
The development of secondary robotics clusters in Minneapolis, along with Utah, Detroit and other areas, are a reflection of a diversified and robust robotics industry, as well as a positive indicator of strong growth to come.
Dan Kara is analyst-at-large for Robotics Business Review. He can be reached at [email protected].