NEW YORK-The New York City Investment Fund and Ericsson Inc. announced plans to establish CyberLab East, the first collaborative laboratory for testing the commercial potential of ideas conceived by the city’s “Silicon Alley” Internet content creator companies.
CyberLab East is scheduled to open early next year in a 5,000-square-foot facility inside the New York Information Technology Center, located on Broad Street just a few blocks south of the New York Stock Exchange. Ericsson opened a similar facility, called CyberLab, in California’s Silicon Valley earlier this year.
“The West Coast facility deals with core infrastructure technologies, while the East Coast facility will deal with content and applications,” said Gary Pinkham, vice president of business development for Ericsson, Richardson, Texas. “By having them operate as one, we have a conduit from the Alley to the Valley.”
At an estimated cost of several million dollars annually, Ericsson will equip and maintain CyberLab East with state-of-the-art telecommunications and computer resources and will staff it with top experts from the industry.
“Ericsson’s decision to locate the hub of its new media research activity in New York City will further accelerate the explosive growth of Silicon Alley, which already is home to 700 enterprises employing over 18,000 New Yorkers,” Mayor Rudolph W. Giuliani said.
The New York City Investment Fund will make a low-cost loan to help finance the laboratory space. It also will tap its network of corporate leaders, venture capitalists and media and technology experts to identify and sponsor projects for development in CyberLab.
Projects presented to the fund for assistance are evaluated on the basis of their strategic impact, including the level of new job creation in New York City and contribution to economic development in distressed neighborhoods. The fund only will invest in projects where it believes it can make a unique contribution and has identified a clear exit strategy.
In September 1996, the New York City Partnership and the Chamber of Commerce of Metropolitan New York launched the Investment Fund, whose members comprise a Who’s Who of corporate America. Its chairman is Henry R. Kravis, who is best known for multibillion dollar takeovers and leveraged buyouts as a founding partner in Kohlberg Kravis Roberts & Co. The fund today is capitalized at $60 million, consisting of individual contributions of $1 million from major corporations in the form of 15-year investments or tax-free donations.
Ericsson will use CyberLab for its own collaborative research projects, but the facility also will be available equally for research and testing of new ideas by local entrepreneurs, other corporations, researchers and educational institutions on a subsidized and/or a cost-recovery basis.
CyberLab will provide a place where the creative talents of Silicon Alley can get direct access to the marketing, financial and other research of international corporations that would otherwise be unavailable or unaffordable for young entrepreneurs and start-up companies.
“Mobile telecommunications and the Internet are the two biggest growth areas. The Internet is a telecom service that requires substantial infrastructure,” Ericsson’s Pinkham said. “If we can understand the applications, we can build a superior infrastructure.”