News and New Products

Will Asia Dominate IT?

By David Manners -- Electronics Weekly, 10/19/2004

On the opening day of the EDA Tech Forum in San Jose the keynote speaker's first question was: "Will Asia dominate IT?"

Henry Rowen, a senior fellow at the Hoover Institution and a former member of several U.S. administrations, said: "Asia has billions of brains with growing skills in science and engineering." Nonetheless there are significant barriers to Asia's success, he reckoned on Monday.

"There have been no Asian technology breakthroughs yet. Hsinchu [Taiwan's high-tech cluster] has not made any major innovation. Bangalore [India's software center] is not yet innovative," said Rowen.

Another drawback to Asia's success in IT is, said Rowen, the lack of high-tech entrepreneurs in the region. "Japan used to be entrepreneurial after World War II, but it fizzled out," said Rowen. "There are very few start-ups in Japan, South Korea and Singapore. There's little equity investment in the region except in Taiwan."

He acknowledged there was some government-encouraged, bank-financed entrepreneurial activity in mainland China and India.

A third drawback to Asia's success in IT is what Rowen called the "opacity" of Asian legal systems by which he meant their lack of transparency and predictability. He showed an Opacity Index in which the worst legal systems were listed as Indonesia, China and India in that order.

"Silicon Valley is a high-cost region and will continue to be that," Rowen concluded. "It will be core functions and ideas."
 
Electronics Weekly is the London-based sister publication of Electronic News.