The area has long been an important one for engineering, housing sites for Rolls Royce and British Aerospace. But six chip design operations have either moved into the area or set up from scratch

The true start-up in the region is Pixelfusion, which set up two years ago by engineers from Division to design a high performance 3D graphics chip, and it was the ready supply of engineers from ST Microelectronics that was a good source of staff, says the co-founder of Pixelfusion.

But late last year saw the region really take off almost independent of the Pixelfusion team.

The highest profile launch was a silicon design team for Acorn in Cambridge, which was a key part of the re-branding of the company to element 14. This was headed up by Simon Knowles, the design manager for the Chameleon media processor design within ST.

"We are just one of the new start-ups in this area in the last 12 months, I guess you could call that a phenomenon, even a 'Silicon Gorge'," said Knowles, who is vice president of chip design for element 14.

"We are recruiting at the moment and we have been very lucky to get a significant number of CVs from people that we already know. A significant number of the people at ST [Microelectronics] felt a lot of great technology had been shelved and that wasn't a sensible thing to do."

But there are others. Siemens Semiconductor (to be called Infineon from April 1st), Lattice Semiconductor and Toshiba are all setting up greenfield design teams in the area, and mixed signal and telecoms chip designers Microcosm chose to move its operation into Bristol city centre to attract designers.

So what is it about the area?

"The reasons for coming to this area are probably the same reasons as Silicon Valley became popular in the first place - it's actually a very nice place to live," said Knowles. "It's not overcrowded, and the fact that I can be part of a silicon startup and still live in Bath is fantastic."

 "It has been for many years the standard route to go out to California at some point and continue your career out there. I probably have more friends and ex colleagues in California than in England and they have a really good time out there but always there has been another group of people that have decided its not for them and that's always been one of the reasons. I think the sudden surge in start-ups here is a recognition that there's that pool of talent still here."

"I guess the question is, can we do a silicon startup in the UK without compromising our preferred lifestyle? It is said that people in our end of the business are quite choosy about the environment they live and work in so if you look at the places that have become popular in this business its Bristol and Bath, Edinburgh and Cambridge."

"I reckon in the M4 corridor is there a whole bunch of people that are fed up with living in that environment and would move out this way if there was a critical mass of silicon design companies was established here."

That trend is also seen by an independent observer. "The hot centres in the UK at the moment are Scotland, particularly around Livingston with the Alba centre, then the M4 corridor, which Bristol is one end, and Cambridge," said Ken Poole, a director of the global incentives and location team at PriceWaterhouseCoopers in Cardiff. He was advising Lattice on their location plans coming to the area.

"What we have noticed in PriceWaterhouseCoopers is that the sorts of projects now coming out of North America are beginning to change," he said.

"There are a lot more service based operations such as software and design centres, and if these trends continue we will see more service-based operations looking to set up in the UK. Obviously the UK has the right ingredients at the macro level, but it is a very different marketplace, where what matters is talent, talent, talent."

"I think Bristol has done well to attract the range of people. That's the key, talent. We've found that's a key locational driver for chip design companies go where they because the talent is there."

"What we are finding is that some of the traditional location factors have gone out the window, as companies have picked up a particular designer who has said he will build his own team up. This has been particularly in the South West with investors we are talking to," he said.

And it's not a question of grant money, as it may be in Scotland. "We were looking at locations where incentives are available, but one investor chose the M4 corridor because that's where the key designer was asking to be," said Poole.

"That's a trend that 's permeating the industry. One example with another client moved to Denmark on the back of a key designer who wanted to go home. The dynamic of this industry is very different from the semiconductor manufacturing industry."

There is also the academic potential, with Bristol University and the University of the west of England (UWE) focussing more and more on technology. Bristol is a key development area in MPEG4 video coding, and the architect of the Chameleon, David May, has returned to the University, taking commercial awareness back into academia

The Toshiba design centre is being set up by the Dean of Engineering at Bristol University, Joe McGeehan, who came from Plessey originally. "The difficulty will always be to recruit the right people," he said. "Really what's happening is the shortage of people going into electronic engineering nationally."

McGeehan is no stranger to the world of startups out of the University, as he was heavily involved with setting up Wireless Systems International which is also based on the Aztec West business park.

"I was very keen that Toshiba came here. If you're going to startup a company in wireless communication, Bristol is a good place to come to. There's an existing infrastructure and if you recruit good people they tend to stay in the area."

There are also the personal relationships to consider when attracting designers, he says. "If you do move to another part of the country you can't forget the problems of partners, and the West country is a good place to be for partners. Quality of life is so important today, it's not just money any more."

Running the centre two days a week, his team will be designing chips for the next generation of mobile phone that will include video and data. "At the moment funding is coming from Toshiba corporation but that doesn't mean we won't be doing other work for other businesses [within Toshiba]," he said.

And he brings a University approach to industry with him. These are researchers, not salesmen, he says. "The key thing is to make sure the people we do employ have security of tenure."

Similarly, analogue chip designers Microcosm moved into the area.

"We relocated to Bristol in January of last year and, not to be nasty to Bristol, it could have been anywhere along the M4 corridor," said Gary Steele, managing director of Microcosm. "But it is somewhere where we could grow our design team as quickly as possible. The constraint on growth is probably people."

The problems over the Avon at Newport Wafer fab (another ex-Inmos site) and its sister Asat packaging plant have been a bonus to them.

"People are coming from the region and from outside," he said. "What with the goings on at Newport Wafer Fab and Asat we are getting people from Wales where they wouldn't really go to Reading or Slough."

Two later entrants both decided on the Bristol area before they heard about Pixelfusion and particularly Element14.

"Element 14 caused problems for me when it became obvious that people had resigned en block in December last year," said John Brothers, who is setting up the design centre for Siemens. "I was the immediate suspect and there are joint projects between Siemens and STM."

"One of the nice things is that I don't anybody, but I know there're there," he said with a chuckle. "At the moment we will have around 20 people by the end of June on board. We've made offers to around 16 at the moment. The plan is to have around 45 by the end of the year."

Brothers used the trade press and ads in local papers. "We were able to recruit from that," he said. Agencies have not been particularly useful, he says. "The people that want to work for us know us, and so the hit rate is pretty high."