by Mike Masnick

Pentagon Spending Could Hurt Silicon Valley

from the the-temptations-of-the-public-trough dept

A good article about why increased Pentagon "war against terrorism" spending may hurt Silicon Valley. While any increased spending is likely to include some high tech spending - which in some way or another will filter down to Silicon Valley, working with government can be dangerous for a company's long term health. The main problem seems to be the notorious inefficiencies found in government contracts. Secretive single source deals are ripe for companies to overcharge and underdeliver. The article talks about how the end of the Cold War hurt a number of companies that had previously ditched their "civilian" business to focus on huge government contracts. It's really a diversification problem. If you start supplying government contracts you tend to focus on only government contracts, and then if you lose that customer, you lose a lot.

Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Use markdown for basic formatting. HTML is no longer supported.
  Save me a cookie
Follow Techdirt
Techdirt Gear
Shop Now: Copying Is Not Theft
Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Report this ad  |  Hide Techdirt ads
Recent Stories
Report this ad  |  Hide Techdirt ads


Email This

This feature is only available to registered users. Register or sign in to use it.