STEPHEN LEWIS reports on some of the exciting new hi-tech firms setting up

business in York thanks to a £1.3million extension to the Innovation Centre in York Science Park...

IN A shiny new office near York University, two tousle-haired young men are lounging at large computer screens. The office is so new it still smells of the plastic packaging the grey Formica-topped desks that furnish it were brought in. Other desks are scattered around the clean, bright room.

This is the home of Lexicle Ltd, one of York's newest and brightest young companies. Here, a team of young computer science whizz-kids are putting the finishing touches to Alex. You haven't heard of her? You will have soon.

Alex is a new virtual reality call centre agent. She can talk, answer questions, provide you with all the information you're likely to need about new investment savings accounts or mortgage accounts - and she'll even get cross if you are rude.

"She can be very assertive," admits Nick Bolton, Lexicle's sales and marketing director.

Alex - she probably won't be known as that by the time you 'meet' her on your computer screen - is the brainchild of Lexicle's directors, Suresh Manandhar, Patrick Olivier, Andy Ormsby, Garry Avery and Nick Bolton himself. Between them, the five men can muster a formidable array of expertise in artificial intelligence, computational linguistics, 3D graphics and marketing. Lexicle was set up to find a practical outlet for that expertise. Alex - or 'Agent X' as she's also known - is the company's first product.

Lexicle is typical of the new spin-off firms that are starting up at the Innovation Centre next to York University. Both Suresh and Patrick are former lecturers in the university's computer sciences department - Suresh still works there part-time - and the two tousle-haired young men crouched over computer screens in the brand new office are both recent high-flying graduates of the department.

Just along the corridor from Lexicle in the new £1.3 million extension to the Innovation Centre that officially opens tomorrow is another new software firm, Live Devices, which also has close links to the university.

Experts here are working on ground-breaking new software which looks set to make the dream of the intelligent 'smart home' - the home you can contact on the Internet to make sure the dinner is cooked, the central heating is on, the curtains are drawn and a gas fire is roaring in the grate when you get home - a reality.

The technology to do this has been around for a while, admits company spokesman Steven Meredith. What Live Devices has done is miniaturise this technology so it is commercially viable. The 'smart home' could be just five years or so away, he says - and so could the 'smart car', one linked up to the Internet which alerts you immediately if there is a traffic accident or road block ahead, and advises you which route to take to avoid congestion.

If 'smart homes' and computer software are not for you, how about a company which is working on potentially life-saving developments in blood transfusion techniques?

Also just settling into new laboratories in the Innovation Centre's new extension is bioscience firm Cell Analysis.

Set up by biology department lecturer Dr Bernard Betts and his business partner Peter Salmon, it is pioneering new techniques for purifying bone marrow cells for transfusion into leukaemia patients, and for screening blood bank supplies for possible signs of bacterial infection.

The technique, patented by the company, involves using tiny electrodes to set up electrical fields which 'purify' bone marrow by attracting only the kinds of marrow cells needed for transfusion - holding out hope that future life-saving bone marrow transfusions will be cheaper, quicker and more effective.

A similar technique can be used to check for signs of bacterial contamination in blood supplies. While there are effective techniques for screening blood supplies for viral infections such as HIV, Dr Betts says, screening for bacterial infections is much more difficult - posing a real threat to the health of patients who need blood transfusions.

"One or two people every year die, and many more become infected because of bacterial contamination," he says.

The Cell Analysis system is already being tried out by the National Blood Transfusion Centre, says Dr Betts, and within six months could be available in hospitals. As well as preventing infection, it will help extend the shelf-life of blood supplies by allowing them to be screened quickly and cheaply in hospitals - vitally important when, as now, there are national shortages of blood.

These are companies at the cutting edge of science and innovation - and they are what the Innovation Centre is all about.

The philosophy behind the centre - and York Science Park itself - is simple. There is some first-rate research going on in York, and much of it has practical, money-spinning applications. Why let the benefits of all that intellectual effort go to big business, when small, local firms, often set up by university staff, could cash in instead?

It was a philosophy developed with enormous success by Cambridge University in the 1970s. The Cambridge Science Park now has some of the leading hi-tech firms in the country - and some of the academics who helped set up the companies, and often run them while continuing their academic research, have become millionaires.

Other universities have followed suit - and with its own science park, York is now bidding to develop a national and international reputation not only for cutting-edge research and development, but for turning that R&D into money-spinning hi-tech businesses too.

Professor Tony Robards, the university's pro vice chancellor who doubles as chairman of both York Science Park and the Innovation Centre, says there are obvious benefits all round, for York itself, for the university and for academic staff.

The city benefits from high-quality jobs at a time when traditional manufacturing industries are in decline - there are now, Prof Robards says, something like 250 hi-tech companies in and around York and firms at the science park employ more than 1,000 people.

Companies setting up in business at the Innovation Centre benefit from being able to draw on the expertise and research facilities at the university next door and the university benefits because it often has a financial stake in the new firms and if they're successful stands to reap a financial reward.

Because of the potential benefit to York in terms of jobs and inward investment, City of York Council put up £250,000 of the £1.3 million for the new extension.

Tony Bennett, head of the council's economic development unit, says that was money well spent.

He says there is huge potential for new businesses in much of the research going on at the university - and it is vital academics who want to turn entrepreneur are provided with the facilities they need to set up businesses locally.

"If we don't do that, people looking to set up spin-off or start-up companies may well be forced to look elsewhere," he says. "We don't want that to happen."

Updated: 10:47 Thursday, April 26, 2001