NYT: Silicon Valley Shaped by Technology and Traffic

I grew up in Mountain View in the 50s and 60s before is was Silicon Valley, so I’m always interested in commentary on what makes it such a special place to technology and innovation, as well as social movements. Here is an interesting NYT article:

(…) “But in Silicon Valley, you locate a company where the engineers are,” he said. “You would never locate a networking company in Palo Alto.”

Silicon Valley, the wellspring of the digital technologies fueling globalization, is itself a collection of remarkably local clusters based on industry niches, skills, school ties, traffic patterns, ethnic groups and even weekend sports teams.

“Here, we have microclimates for wines and microclimates for companies,” said John F. Shoch, a longtime venture capitalist.

Silicon Valley, home of Stanford and other universities, has long been the model of success for a modern regional economy, and policy makers worldwide have tried to emulate it by nurturing high-tech companies around universities. There have been a few winners, like the semiconductor manufacturing hub in and around Hsinchu Science Park in Taiwan.

Yet a look at the microclusters within Silicon Valley demonstrates the business relationships, the social connections and the seamless communication that animate the region’s economy. It also suggests the human nuance behind the Valley’s success and shows why that success is not easy to copy, export or outsource.

“These microclusters turn out to be a very efficient way to innovate, to see what works and what fails, and do it extremely rapidly,” said AnnaLee Saxenian, an expert in regional economies and a professor at the University of California, Berkeley.

New companies, and emerging industry clusters, seek to build on and tap the skills of older clusters. While there are plenty of exceptions, it is generally true that hardware clusters — semiconductors, disk drives and network equipment, for example — are in the South Valley, around San Jose and Santa Clara. The actual manufacturing of hardware, of course, moved to cheaper places years ago. What remains in the Valley is product design and engineering.

Moving farther north in the Valley typically means moving farther away from the guts of the machine and climbing up the tiers of computing — from chips to layers of business and consumer software and then into San Francisco, home to people with online advertising and digital design skills. (…)

Of course the article quotes UC Berkeley’s AnnaLee Saxenian, who wrote the book Regional Advantage that influenced my thinking so much on the importance of university/business cohabitation as a source of accelerated innovation.


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