The lure of Silicon Alley

HALL

Martin Sorrell, chief executive of the world’s largest advertising and design group WPP, was seen in New York last week, rumoured to be scouting for a creative “hotshop”. Back from the brink of extinction, according to the New York Times advertising correspondent Stuart Elliott, Sorrell’s group is in the mood for cautious expansion – particularly in the realm of multimedia. “We need to explore how advertising content can be developed in the new media,” Sorrell told Elliott.

In the light of WPP’s recent purchase of a 5 per cent stake in Hotwired – the relentlessly popular Web site of Wired magazine and an early success story in the brief and boisterous history of the Internet – Sorrell seems not to be limiting his sights to small advertising agencies. And wisely so. The art – or science – of designing corporate Web sites is not limited to agencies, but evenly distributed among design groups, agencies, and new firms specifically devoted to creating new media.

New media is also now the third largest media employer in New York, according to a survey conducted by accountancy firm Coopers & Lybrand, with 1350 businesses in the metropolitan area. Over the past three years, it has more than doubled in size, to become a $3.8bn (2.5bn) a year industry.

Compared with San Francisco and the surrounding Bay Area, which has more than 2200 new media companies, New York’s digital delegation is still relatively small. The difference between the two centres, however, is an important cultural one. California is the home of new technology, New York is the home of publishing. Or, as local wags would put it, California has Silicon Valley, New York has Silicon Alley. West Coasters may rightly groan at this latest nickname for the glut of small new media companies below 41st Street in Manhattan, but it is a densely populated neighbourhood providing content for CD-ROMs, Web sites and interactive displays.

Those with the warmest fingers seem to have picked up on this. Craig Kenarick, a designer at the definitive New York new media hotshop Razorfish (http:www. razorfish.com) observed that Silicon Alley has a peculiarly anachronistic, non-digital, people-buzz. “I can go out and run into a photographer or account director that I’m working with, or would like to work with,” he says. Even Californians like David Karam, whose artistically driven digital design group Post Tool is based in San Francisco, recently came to New York to speak at a gathering of new- and old-media designers, and remarked that the enthusiasm level for the Web was noticeably higher in the bigger city.

It seems strange that in the age of the digital nomad and the baud Bedouin a creative community should spring up in such old-fashioned terms of geographical proximity. But New York’s advantage is that creative media people are already in the city for television, advertising and publishing work. When the Santa Monica-based Voyager, publisher of more than 50 CD-ROMs, opened New York headquarters, its creative director Bob Stein said that the company needed to be where its content suppliers are – the “writers, designers and creators”. Two-thirds of Voyager’s staff are now working in the rotten apple. The music, publishing and cable TV colossus Time Warner invests heavily in multimedia at its New York HQ, and is promising early investigations into interactive TV.

WPP’s two NY giants, Ogilvy & Mather and J Walter Thompson, are not currently earning points for creative leadership in new media. The best work is coming from those attempting to engage, rather than bombard – in the TV style – their audiences. Inevitably, the small companies are the most quick-witted and fleet-footed at this kind of production; Razorfish, i/o 360, and on the slightly larger scale, Voyager and R/GA.

The large agencies are useful, however, for providing the resources to service a multinational client. Faced with the new media goldrush, WPP’s solution may have to be collaboration between its companies. With increasing frequency, small creative shops are collaborating with giant publishers and agencies to produce interactive work. Animators, writers, photographers and composers are being pulled in to work on Web sites.

A small new media group has low overheads, partly because its employees don’t expect the same salaries as their advertising counterparts. No wonder Martin Sorrell finds the idea of buying a small hotshop “seductive”.