03/28/2008 02:46 am ET Updated May 25, 2011

The AOL Exodus Effect

Barry Schuler moved to Washington from Silicon Valley to join AOL during its golden days, one of the many top technology professionals the Internet giant recruited to the region. But when the former chief executive left in 2003, he returned to California to become an investor and start a technology company, following other executives who have drifted away from the region.

"We gravitated back to our roots," Schuler said. "This area, the Bay Area, continues to be the epicenter of emerging technology."

Departures like Schuler's are one reason Washington's technology industry is still struggling to mature a decade after Dulles-based AOL became a magnet for talent.

Without schools such as Stanford or MIT, Washington counted on AOL to build up the local consumer tech industry, just as Microsoft did in the Seattle area. And for a time it did just that, becoming the country's best-known online company and recasting the region's image as more than a sleepy town of opaque government contractors.

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