You Don't Create A Silicon Valley By Government Fiat

from the takes-a-bit-more-than-that dept

Two separate articles came out in two separate newspapers based 3,000 miles away from each other this past weekend -- but together they demonstrate exactly why so many places have had difficulty creating their own, local versions of "Silicon Valley." Especially during the dot com bubble, it seemed like every country and every state wanted to create some area that was a "local" Silicon Valley. There were silicon islands and silicon prairies and silicon alleys and silicon mountains... and almost all of them went nowhere. An article in the San Francisco Chronicle talks about how the original Silicon Valley was created, through a mixture of strong educational institutions, easy flow of capital and a culture that focused on risk, experimentation, entrepreneurship -- and the free flow of ideas. While the government played a big role in early Silicon Valley culture, it was as a customer, not as the creator of the culture. Contrast that to the story in the Washington Post about how Prince William County set out to create a high tech hub, which is still struggling to get much traction in the high tech world. Rather than paving the way for those critical components to form, the county simply set aside some land and (it appears) some marketing efforts to promote the county as a good place for high tech companies. That seems to be about all that many other "silicon somethings" did in the past decade as well -- forgetting that there's a lot more involved in creating a true high tech hub.


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  1.  
    identicon
    Keith Dawson, Oct 2nd, 2007 @ 1:11pm

    Silicon Valley wnnabees before and during bubble 1

    Beginning in 1995 I collected information about the Silicon Valley wannabees on this page. It's still up as a historical record; I haven't updated it since 2001.

    -- Keith Dawson, former proprietor of TBTF

     

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  2.  
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    dorpus, Oct 2nd, 2007 @ 1:13pm

    Does Silicon Valley Exist?

    Microsoft is not based in Silicon Valley. Neither is IBM, AT&T, or many other established high-tech companies. No significant manufacturing occurs in Silicon Valley either. The Valley is a place where scammy start-ups come and go by the week; the few companies that succeed often move to a cheaper location later. People have no loyalty to the Valley either; as soon as they are well off, or they burn out of the IT business, they are eager to move somewhere else. Between the foreign majority of Valley residents, who are openly loyal to their home countries, and the ponytailed white liberals who hate anyone not like themselves, the atmosphere in the Valley is not a place that most people would want to live, much less feel loyalty. While there are no other Silicon ____'s of comparable stature, the collective economic power of other _____'s are far stronger than the Valley itself.

     

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  3.  
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    Joyce Carpenter, Oct 2nd, 2007 @ 1:21pm

    Government fiat, no; government hiring, maybe

    According to a story in today's Computerworld, The metro DC area is second to Silicon Valley in tech workers per capita. "Roughly 6% of the D.C. metro area workforce is made up of "computer specialists," compared with 8.3% in Silicon Valley. The third-highest concentration of IT workers is in Raleigh/Cary, N.C., at 5.3% of the workforce, followed closely by Boulder, Colo., and Huntsville, Ala., each at 5.2%. The remainder of the top 10 technology worker areas is rounded out, in order, by Bloomington/Normal, Ill.; Trenton-Ewing, N.J.; Austin-Round Rock, Texas; Manchester-Nashua, N.H.; and Seattle-Tacoma-Bellevue, Wash."

     

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  4.  
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    dorpus, Oct 2nd, 2007 @ 1:23pm

    p.s.

    Increasingly, the high-tech business is driven by companies that can integrate IT into the health care field. Silicon Valley does not have large medical centers; the quality of health care in California is abysmal, even by American standards. The medical centers at Stanford and UCSF are small and not ranked very highly among national medical centers for their quality of care. The Valley is fixated on biotech start-ups, which have historically had a very low success rate.

     

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  5.  
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    Valley Denizen, Oct 2nd, 2007 @ 3:16pm

    Missing the point...

    At some level, government bodies looking from the outside in apparently have their eyes glazed over on the prospects of tax revenues and exclaim with glee, "oooh, I want one of those" when they see Silicon Valley. They set aside some land a try to recruit some big tech companies.

    The problem for them is that Silicon Valley is not at all like that. For every Yahoo, Intel or Google there are hundreds of companies that employ fewer than 100 people that makes something or supplies a service that are key to high tech. It becomes a huge interconnected web of suppliers and consumers that goods and people float around to.

    I don't believe that dorpus lives in the valley. If he does, he definitely took his cynic pills this morning.

    True Microsoft, IBM, AT&T and other hight tech companies are headquartered elsewhere but, those three all have a presence in the Valley. Apple, Yahoo, Google, Intel, AMD, Sun, eBay, BEA, Oracle, Sybase, Adobe, Cisco, nVidia, Webex, Verisign, Network Solutions, HP, Applied Matierial, National Semiconductor, Netflix, Varian, Intuit, Electronic Arts, Solectron, E*Trade, Network Appliance, Juniter Networks, Netgear, Maxtor, Western Digital, Segate, Altera, to name a few, are. These are hardly scammy startups.

    Not all companies become industry giants but that doesn't mean that they are unsuccessful. There are hundreds of Valley companies that are successful by any measure. They provide stable employment and return a profit to their owners and investors.

    It would also be unwise to assume that the only tech workers in the Valley are either in IT or "computer specialists." The Valley makes the hardware and software tools that make the specialties possible.

     

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  6.  
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    dorpus, Oct 2nd, 2007 @ 4:22pm

    Re: Missing the point...

    >I don't believe that dorpus lives in the valley. If he does, he definitely took his cynic pills this morning.

    I lived there for 5 years before. I moved on to health-related industries, which offer equal or greater pay, and treats its workers a hell of a lot better.

    >There are hundreds of Valley companies that are successful by any measure. They provide stable employment and return a profit to their owners and investors.

    Stable employment, in IT? Heh. At the first sign of trouble, Valley companies lay off most of their workforce, hire new CEO's who don't know anything and mess up the company some more. The Valley companies that survive are those that have operations outside of the Valley to provide them steady revenue. The Valley specializes in the volatile, failure-prone new technologies; if they succeed, the jobs involving them are quickly exported somewhere else.


    >It would also be unwise to assume that the only tech workers in the Valley are either in IT or "computer specialists." The Valley makes the hardware and software tools that make the specialties possible.

    Sorry, but your sentences are contradictory. Hardware and software tools are, by definition, IT or computer specialties.

    If you want to talk about non-computer hardware, such as medical devices, then the Valley is not a significant player in that industry. Medical device makers are concentrated in the Midwest, where there is a combination of huge medical centers, an ample supply of mechanical engineering graduates, and a network of specialty plastic and metal makers.

    As the world's population ages, health care is destined to become the predominant economic activity. The Valley is poorly equipped to meet this challenge, owing to its small medical centers, lack of expertise. Techies in the Valley are for the most part very ignorant of the health sciences, obsessed with their "herbal medicine cures". California has put all its eggs in the two baskets of stem cell research and biotech, which insiders know have not been too successful.

     

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  7.  
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    Cynic? Or Realist?, Oct 2nd, 2007 @ 4:49pm

    The Govt does nearly nothing well - -

    San Jose is in terrible financial shape - they had so much income during the bubble and they committed to a bit staff & benefits (which in govt means until death do you part) - so they now have huge unfunded liabilities and much less income. Same thing is alas true for CA in general.

    Free enterprise works. But only till the govt can put it entirely out of business with ineptitude.

    Hey, maybe they would run my medical plan for me?????

     

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  8.  
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    Jeremy Pepper, Oct 2nd, 2007 @ 7:21pm

    It depends where ...

    Israel's made a go of it (with the help of the government), and Ireland has a pretty good community.

    I think there's a balance, but not sure where that is, with government help and innovation.

     

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  9.  
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    Jon L, Oct 2nd, 2007 @ 11:03pm

    It's Where the Money Is...

    Rich VC's like Northern California A LOT. Notice the price of housing in Silicon Valley?

    Sand Hill Road alone houses probably close to 60 Venture Capital funds, whose combined total for investing is in the billions.

    It's true that a lot of those VC funds came in during the dot com rush, but those that have stayed and made it make the Valley THE place to come for money for tech startups - and tech start ups elsewhere in the country usually have to come to SV to do their song and dance.

    Hence, startups that don't have much cash (most of them) are much better off and more strategically placed for access to capital if they startup in SV.

    We make the trip up there from LA about every 3-5 weeks for meetings, etc - and the entrepreneurial "support groups" etc that exist in SV are far and away stronger than in anywhere else in the US simply by the sheer number of people "trying new things" with new companies... and they all need other folks to have drinks with, etc.

     

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