Fibre Optic Valley is a cluster initiative that has the ambition to become Europe’s leading area in this field of technology, thereby creating thousands of jobs by 2015. The goal of the members of the cluster is to create Europe’s most favourable development climate for new companies in the field of Fibre Optics: through creating an arena of competence and knowledge within this field. It is expected that this will attract financiers, entrepreneurs and innovators to the region.

Activities within the framework of Fibre Optic Valley aim at supporting regional growth through developing know-how and innovation in the digital communication sector. This includes offering support to business development from an initial idea to a final product.

The cluster focuses on the following three areas:

• fibre to the users (FTTX): constructing the “true broadband society”;

• e-services: as fibres are installed in all homes, which (capacity demanding) services are in demand?
  

• fibre optic industry based application: e.g. fire alarms, information systems in tunnels, transporting of welding flames, and other new techniques where interesting innovations are made.
  

Fibre Optic Valley works to create an innovative climate in these three technology areas by co-ordinating and mobilising resources in order to offer a test bed with contracted test pilots, qualified evaluators, research, training, business models, behavioural analysis, statistical models and an advanced fibre laboratory. The cluster is based on the philosophy that the activities and ventures supported must create an added value for the co-financiers and partners. It is the business perspective that sets objectives since it is the companies who bring innovations to customers and where the new jobs are created.

Since 2000, Fibre Optic Valley has been developed through a combination of six interlinked projects support a laboratory, research and development facilities and services, a test bed, users studies, R&D driven business development, and marketing and information support. The three focus areas are the driving force of the valley with each following specific development steps and processes. Project participants underlined that the experiences gained and actions taken within one project have been the basis for the next, so that knowledge has been built up over the entire chain of projects.

The direct beneficiaries are the members of Fibre Optic Valley, who take part in projects and benefit from the added value created through the user-driven research initiated within fibre optics. Additionally, the local higher education institutes (Mid Sweden University and the Högskolan i Gävle, Gävle University6) and local research institutes have been given a better framework in which to pursue contract research in the fibre optics fields.

Indirectly the valley creates new job opportunities for the region's inhabitants in the region and increased income and revenues for the municipalities. Other small enterprises who are not members of the cluster also benefit from being in a region at the forefront of the development of new services based on fibre optic broadband. Even Ericsson7 and Iggesund8, the two largest international companies with production in the region, benefit from the project, since the actions within Fibre Optic Valley offer a more 'open innovation' environment in the region, sustaining a broader approach to new product development.

A number of striking results of Fibre Optic Valley can be highlighted:

• fibre optic broadband has been installed and is accessible to actors in the region;

• a research institute, Acreo, has been attracted to the area;

• the construction of an apartment building fully equipped with fibre optic systems where inhabitants’ usage can function as a test environment for e-solutions;
  

• a complete test-bed and fibre lab for worldwide use has been created.

The 'test-bed' is an open network of 300 technology testers, all with 100 Mbps triple play (Internet, telephone, TV) access into the home. The test bed also has a wider network of 1,500 testers which evaluate e-services. Here, systems developers, network operators, service developers and researchers can test new products and services, such as IP distributed HDTV, in an environment that combines technology tests with behavioural studies. Some 15 international and national systems suppliers are present in the test bed, which is the official testing ground for three EU broadband research projects (MUSE9, NOBEL10 and MUPBED11). Acreo is present in all three projects.

According to project reports, by-mid 2007, Fibre Optic Valley had indirectly supported the development of 230 new jobs in the region, and 500 in all of Sweden. Seven new enterprises in the field of fibre optics have been created in the region. Moreover, 19 doctoral students have graduated thanks to funding or studies initiated by Fibre Optic Valley. In the longer run, the expected impact of this project is to have added about 2000 new jobs in the region by 2015. Additional growth is to be created within the three focus areas: fibre to the user; e-services; fibre optic industry applications.

The European Regional Development Fund (ERDF) has been a very important financial contributor to the pipeline of project funding in favour Fibre Optic Valley. The ERDF cofinancing,
together with the long-term regional and national financing, provided a foundation for the cluster and enabled it to build capacity to launch new activities. In particular, the possibility to work on the three focus areas in parallel, fostering important synergies and cross-cutting activities, would not have been possible without the additional financial means provided by the ERDF.