Though the financial collapse of 2008 hit New York City hard, it also had the beneficial side effect of redirecting some of the town's energies away from Wall Street and toward other industries. Perhaps the leading beneficiary has been the tech sector, where the Web 2.0 crowd has been enjoying an influx of venture capital and an uptick in networking groups, civic initiatives and university programs aimed at stimulating tech startups. This week the third annual Internet Week New York festival, which features about 200 events in and around Manhattan from June 7 to 14, offers a window on what the city has -- and hasn't yet -- accomplished as it tries to become a digital epicenter.

What Silicon Valley has that New York lacks is a deeply rooted culture of engineering entrepreneurism that has permeated the San Francisco Bay area for decades and produced tech giants from Hewlett-Packard Co. (NYSE:HPQ) in the 1930s to Google Inc. (NASDAQ:GOOG) in the 1990s. By contrast, the roots of Manhattan's tech entrepreneurism go back only about 15 years to the dot com boom of the 1990s.

The good news is that New York's Web 1.0 entrepreneurs, such as former DoubleClick Inc. CEO Kevin Ryan and former AOL LLC executives John Borthwick and Andrew Weissman, are actively mentoring and investing in the Web 2.0 set.

The city is also doing its part, led by Mayor Mike Bloomberg, who as the founder of Bloomberg LP is held up as one of the most successful tech entrepreneurs in Gotham's history. Over the past two years, the city has spent $6.7 million on programs designed to jump-start entrepreneurism, including competitions and tech incubators. And while that's not much more than the price of a nice apartment with a park view, the city has also teamed up with private investors to form early-stage investment funds, such as the $22 million NYC Entrepreneurial Fund formed in partnership with FirstMark Capital.

The real impetus, of course, has to come from the markets -- including the one for talent. Here the signs are encouraging. With fewer jobs available on Wall Street, top-tier engineering students are increasingly pursuing careers at New York's technology startups, reports Chris Wiggins, an associate professor of applied mathematics at Columbia University's engineering school.

New York is still a long way from producing a tech heavyweight on the order of Apple Inc. (NASDAQ:AAPL) or Oracle Corp. (NASDAQ:ORCL) But its position as home to media and advertising companies, major participants in the Web 2.0 wars, could well help it overtake Boston. That's a project all five boroughs could probably get behind.