Digital technology has permeated most sectors of the economy, a result of continuous improvement and convergence in computers and telecommunications, and the Internet revolution. Unprecedented tradability of digitized information and information‐intensiveness of business are driving the collapsing of value chains’ organizational and spatial dimensions. We are witnessing a trend of vertical disintegration followed by complex re‐arrangements that mix horizontal reintegration and spatial agglomeration with various patterns of dispersion. With the support of two empirical examples, this article endeavors to show that the territories of the digital economy are built under a permanent tension between these centripetal and centrifugal forces. Economic geography thinking should – in part – reject the traditional Christallerian hierarchy of scales, and consider instead the ability of contemporary business organizations and dynamics to squeeze out intermediary scales and places. The agglomeration theory, although still valid, is challenged by technological improvement and the evolution of the information society.

This article focuses on the tendency of e-business towards urban concentration. The complexity of the Internet sector results in an increasing variety of business location. The survey of 92 firms in the multimedia sector in Lyon shows that enterprises do not have the same location needs, neither at regional nor at local level. Multimedia and software designers are more 'footloose' than Web agencies and Internet service outsourcers, which are linked to their clients and to broadband networks. The former may locate in picturesque renovated areas, or even in rural areas. The latter tend to share high-tech-suited locations with Internet and telecom carriers in state-of-the-art, wired premises. Finally, this considers the question of the status of a medium-sized city and its different districts in the context of a growing information economy.

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