Comment: Two weeks ago Media Lab Europe hosted a major conference on innovation and how it is the key to invigorating regional economies.

The event was attended by representatives from nearly every country in Europe - including ambassadors from France, Norway, the Czech Republic and Ukraine - and it culminated in the signing of a significant €600,000 partnership agreement between the Lab and the Highlands and Islands Enterprise Network in Scotland.

These visitors represent just a tiny percentage of the thousands of influential innovators, businesspeople, politicians and government officials from around the world who have passed through Media Lab Europe's doors since it opened three years ago.

They have been attracted to Dublin because there is simply nothing like Media Lab Europe anywhere else on the continent. Founded in July 2000 as a collaborative venture between the Irish Government and the Massachusetts Institute of Technology (MIT), Media Lab Europe operates as a hybrid between academia and the corporate world to create a unique new centre of excellence in digital technologies.

For instance, Google co-founders Larry Page and Sergey Brin spent several hours at the facility earlier this week. Afterwards, at a press conference launching Google's EMEA headquarters in Dublin, Brin was reported as saying that after visiting Dublin's high-profile research facility, Google may also look to establish an advanced research and development unit in Ireland. This is further evidence of how the lab is contributing to Ireland's international visibility and reputation.

The lab carries with it the massive reputation of its parent, MIT, perhaps the best-known research lab in the world. It invents by bringing together scientists, engineers and artists from different backgrounds, disciplines, cultures and nationalities to create technologies and explore applications that have barely been dreamt of.

From a site at the old Guinness Hop store in Dublin's Liberties, the organisation has evolved and matured. There are now 70 staff and researchers, centred on eight core research groups, who have spent the past 36 months establishing the lab as a centre of scientific excellence and intellectual property. A number of Media Lab Europe projects have already moved from the lab into "real world" usage.

There are over 20 collaborative projects with Irish universities underway where faculty and students from the university collaborate with Media Lab Europe researchers. This provides a number of Irish third-level institutes with exposure to MIT innovation.

The Lab has partnered with many of Europe's leading academic and research institutions. They include the University of Sheffield, Portugal Telecom Inovação, Cap Gemini, Ernst and Young, Royal National Institute for Deaf People, Vox Generation, the University of Exeter, DLR Institute of Robotics and Mechatronics, Max Planck Institute for Biological Cybernetics and Sony CSL.

Much of its activity produces copyrightable software that can be licensed. Partners are closely involved with and aware of new technologies and potential applications as they are explored and developed. This process is further facilitated by the lab's emphasis on producing working demonstrations of ideas, technologies and applications.

Under Media Lab Europe's pooled funding model, each partner gets shared access to all of the technology and intellectual property.

Despite the economic downturn of the past three years, Media Lab Europe has already raised over €11.5 million in hard cash through its partnership programme and has contractual commitments in place for significant additional contributions. It has also secured equipment and service contributions valued at around €1 million.

Funding has come from many organisations, domestic and international. These include AIB (Ireland) AOL (US and Ireland), BBC (UK), BT (UK), Eircom (Ireland), Ericsson (Sweden), Essilor (France), Fondazione Ugo Bordoni (Italy), Intel (US and Ireland), Orange (UK/France), Foundation for Science and Technology (Portugal) and Royal Mail (UK).

But it is a fact of life that nearly every organisation in the digital-media sector has reined in research spending as they have struggled to weather the economic storm of the past three years. This has had an inevitable knock-on effect on the lab.

Staff and researchers are working hard to identify alternative funding sources. The agreement with the Highlands and Islands Enterprise Network is just one example of a number of new and innovative agreements in the pipeline, reflecting the fact that the organisation acknowledges the need for its financial model to continue to evolve.

However, it is clear to all concerned that these new and innovative agreements will not cover the Lab's everyday running costs in the short term and it will hit a financial barrier next year as funding runs out.

The establishment of Science Foundation Ireland, the Programme for Third-Level Research in Ireland and the Government's support for Media Lab Europe reflect an acceptance by the Government that support for research is fundamental to Ireland's economic development.

Indeed, most experts believe there is a need to increase Government funding to bring Research & Development spending up from its current level of 1.1 per cent of Gross Domestic Product (GDP) in the State to the European Commission's goal of 3 per cent of GDP by 2010.

Media Lab Europe brings to Ireland a unique centre which in turn is attracting top class researchers from all over Europe, as well as providing opportunities for collaborative teaching, learning and research for Ireland's universities and colleges and can act as a catalyst for new technology start-ups. Furthermore, despite the difficult economic climate of recent years, it still has the ability to draw research funding from the world's leading companies and regional development agencies.

As one of the original donors to the lab, I continue to believe in Media Lab Europe and continue to expect that, over time, its existence here will have a transformational impact on Ireland's growing capability and reputation as a location for high tech research and innovation. I continue to believe that the Government was right to invest in its creation and I believe that the Government should help it through the current tight economic times. I remain convinced that, in the long run, the investment will have been well made and the return to Ireland will be significant.

Denis O'Brien is on the board of directors at Media Lab Europe