HomeMy WebLinkAboutCAO-08-028 - Digital Media Convergence Centre1
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REPORT
Report To: Finance and Corporate Services
Date of Meeting: September 8, 2008
Submitted By: Rod Regier, Executive Director, Economic Development
Prepared By: Silvia Wright, Manager, Downtown Development
Wards) Involved: All Wards
Date of Report: September 3, 2008
Report No.: CAO-08-028
Subject: DIGITAL MEDIA CONVERGENCE CENTRE
RECOMMENDATION:
That Council authorize a letter of support for the "Digital Media Convergence Centre" (DMCC)
as part of a nationally significant Communitech funding application to Centres of Excellence for
Commercialization and Research (CECR) as the "Centre for Advancing Canadian Digital Media"
and further that specific only to this grant application;
That Council authorize the investment of $500,000 from the Economic Development Investment
Fund to be allocated for the purchase of specialized computing, digital imaging, visualization
and studio equipment required at start-up;
That annual in-kind support for five years in the form of staff time dedicated to supporting
events, promotion and governance (DMCC board seat for Mayor of Kitchener or designate) at
the Digital Media Convergence Centre;
And that this support is subject to full approval of a grant application to the Centre of Excellence
for Commercialization and Research, and is conditional on the DMCC being located in
downtown Kitchener.
BACKGROUND:
Digital media has not only become a seamless part of everyday life but recognized as a driving
force for all sectors of the Canadian economy. Second only to oil tar sands industry, digital or
new media has been measured as the highest growth potential industry in the nation ("The
State of Science and Technology in Canada," Council of Canadian Acadamies, 2006).
Here in Kitchener, Economic Development staff first gathered the Digital Media Working Group
in 2005 to explore new business sparks through the mash-up of small independent content
developers, large corporate technology companies, researchers, academics, and digital artists.
Two unique digital media networking events were organized through City staff: the "Legions of
Memory", June 2006 and the "Canadian Film Centre's Habitat New Media Demonstration" in
November 2006, with support of the Grand Exposition, the KDBA, Film KW and the University of
Waterloo. The events connected representatives from across the industry including
Desire2Learn, UW Digital Art Communication, Christie Digital, Communitech, Conestoga
College and numerous individual new media artists throughout the City. The most consistent
recommendation from this group was the need for a digital `sandbox', the possibility of a location
where best technologies could be made available to new business in a supportive multi-
disciplinary setting, and where innovators could commercialize ideas, creating jobs and
strengthening the local economy.
Since that time, staff worked with partner organizations to support Communitech's CECR
application to help fund the Centre for Advancing Canadian Digital Media (C-ACDM) - a $65
million distributed network that includes the downtown Kitchener Digital Media Convergence
Centre and University of Waterloo's Stratford Institute.
Christie Digital, firmly rooted in the Electrohome heritage of Kitchener, now implements 3D
digital movie projection around the world, leading projection at the New York Stock Exchange,
and the Beijing 2008 Summer Olympics. Christie Digital also provides 3-D immersive
environment projection for such applications as pharmaceutical molecule visualization or
astronaut training environments to repair the Hubble Space Telescope; an experience which
can only be described as a'holodeck' environment once thought only possible in science fiction.
Existing digital media firms have demonstrated global leadership in development in this
technology and are successfully competing on the global stage for the last several years. This
combination of talent and enterprise gives us a substantial advantage of building a globally
competitive digital media cluster in this City.
REPORT:
Council direction has approved strategy for Digital Media Incubator as a top priority for
Kitchener Economic Development Strategy 2007-2010 (June, 2007). Specific opportunities exist
in fields driven by digital media such as medical imaging and pharmaceutical modeling,
manufacturing (virtual prototyping), architecture, cinema, game technologies, digital art, and
environmental modeling, to name only a few of the areas of economic impact.
The Centre for Advancing Canadian Digital Media (C-ACDM) is a grant application for Network
of Excellence put forward by Communitech for a total project value of $65 Million of which
approximately $30 Million for the Kitchener portion. It includes 2 institutes and will link Canada's
digital media clusters from coast to coast - creating a digital convergence corridor and enabling
collaboration between researchers, implementers, and entrepreneurs.
Initially, two complementary digital media hubs combine as a new Centre for Excellence:
1. Stratford Institute (SI)
The Stratford Institute will offer a research environment for graduate students to foster
commercially viable content creation.
2. Digital Media Convergence Centre (DMCC) in Downtown Kitchener
The Digital Media Convergence Centre will offer the latest visualization hardware and
software, technical and business start-up services (e.g., mentors and venture capital
services), and studio/office space for innovators in their start-up or pre-start-up phase.
This Digital Media Convergence Centre is recognized as fundamental to the current provincial
and federal strategy. CONCERT identifies the "convergence" centres as a method to network
and accelerate economic opportunities to serve as regional innovation and commercialization
hubs for the cluster.
The City of Kitchener contribution from EDIF of $500,000 to the Digital Media Convergence
Centre would provide some of the specialized equipment and technical resources to operate the
incubator for commercial digital media applications. The approximate project cost of the DMCC
is $30 Million over 5 years. As a partner to the project, Kitchener has the opportunity to attract
and incubate businesses to strengthen this growing economic force in the city. Opportunities
are strengthened through representation on the Board of Directors (Mayor of Kitchener) and the
catalytic presence in downtown Kitchener. The Digital Media Convergence Centre is ideally
suited to drive the growing investor confidence for the cluster developments identified in the
Economic Development Strategic Plan.
As part of a larger project, $12 Million cash and in-kind is committed from industrial partners in
the Waterloo Region, $5.7 Million is committed from academic institutions, Communitech is
committing $1 Million, $10 Million is allocated from both the Province of Ontario and the City of
Stratford bolstering this request to the federal CECR program for $20 Million. The detailed grant
application submitted through Communitech includes significant economic impact information
and a business plan which represents a fulfilment of the EDIF requirements for a business case
on allocation of these funds.
In addition to the cluster development strategies, the Digital Media Convergence Centre
(DMCC) is consistent with objective to attract, retain and develop talent to drive all sectors of the
economy. Critical to future economic stability, the Economic Development Strategic Plan clearly
outlines the need to provide a "magnet" for talent, specifically in authentic urban environments
available in downtown Kitchener. The synergy of leading edge technology in the inspired urban
setting of Downtown Kitchener, having all the right features for attracting the next generation
required to sustain our diverse economy.
The natural fit with biotechnology and life science visualization further promotes opportunities in
biotechnology clusters, particularly with the proximity of the UW Downtown Kitchener Health
Sciences as catalyst.
Consistent with existing strategies and business trends, this investment constitutes an excellent
candidate for the Economic Development Investment Fund. Provision for the use of the EDIF
Employment funds for the digital media centre are already been allocated to facilitate just such
an investment.
CONCLUSION:
Kitchener based companies such as Christie Digital already enjoy tremendous international
success in the digital media industry. Still more is possible by leveraging the resources currently
available in the region's industry and institutions to stimulate and accelerate the growth of digital
media start-up- as well as existing companies, and attract new investment in this rapidly
growing field. The proposed Digital Media Convergence Centre represents a significant
opportunity to advance Kitchener's technology industries and enhance our ability to attract
business investment and talent. The investment in this location of the DMCC, partnered with a
private sector development ensures a leadership voice for the City of Kitchener in attracting
talent, developing new jobs and sparking vitality for quality of life.
The $500,000 commitment to invest will propel the City of Kitchener to the national stage,
having a driving role in the creation of a digital convergence corridor that can link researchers,
implementers and entrepreneurs from coast to coast. Should council approve this allocation, a
letter of support for the Communitech application will be required prior to the October 15t", 2008
CECR deadline. The Government of Canada will award funding grants by January of 2009, with
the DMCC also starting development in 2009 immediately after approval.
FINANCIAL IMPLICATIONS:
This project will require a $500,000, Economic Development Investment Fund (EDIF)
investment in 2009. This represents a portion of a notional allocation of up to $1 Million included
in the 2008 EDIF "employment lands" budget to support the Digital Media Convergence Centre.
COMMUNICATIONS:
The Digital Media Convergence Centre application is now advanced to Round #2 of the Centres
for Excellence in Commercialization and Research through the larger Communitech application
which includes the Stratford Institute. As the application proceeds further, staff will work with
the city's partners to prepare communication for council, the community and national media.
Rod Regier, Executive Director Silvia Wright, Manager
Economic Development Downtown Development