As I've previously mentioned, I'm curious about what seems to have become an international obsession with finding the next great Silicon Valley. I don't understand the need for an over-the-top branding effort to give one's city, province, or country a special high-tech tag. Nevertheless, I like watching how innovation moves across regions, wins financial investment, and infuses people and industry with inventive energy. (See: Silicon Valley Dreams.)
I got to thinking about this topic again when I came across some recent headlines.
Last week, an article by Emma Barnett, the Telegraph's digital media editor, gushed about Israel's thriving high-tech scene. It begins by saying the country, which is always in the middle of political turmoil, is earning a reputation as "the world’s second Silicon Valley." Barnett goes on to say that Israel, which ranks roughly 100th in population, has more Nasdaq-listed companies than any country other than the US. "It also has highest number of high-tech startups, estimated to be 3,500, ranging from Internet companies to software solutions, outside of the US."
How has Israel obtained such prestige? There are several reasons, including a high number of engineering and business graduates and a venture capital community ready to fund golden egg opportunities, but Barnett cites compulsory military service as an important factor. One source told her that the military's engineering training, combined with Israeli culture, gives people a feeling that "they can achieve something great on their own."
On the other side of the Mediterranean, the high-tech hubbub has reached Barcelona's shores. The city got word last week from the GSM Association that it had been selected as the "First Mobile World Capital" and will get to host the Mobile World Congress from 2012 to 2018. The title is more or less promotional, but the announcement is actually a big deal. First, the MWC exhibition (which is several years old) and related events will create thousands of jobs. Second, the title is expected to fill the city's coffers. According to Barcelona's bid application, the city stands to generate more than €300 million (US$434 million) in its first year as Mobile World Capital, and that figure could reach €3.5 billion over the next seven years.
Why did Barcelona beat out Milan, Munich, and Paris for this status-boosting title? The GSMA cited "its combination of outstanding exhibition and conference facilities, its transportation and hospitality infrastructure, its commitment to expanding the reach of mobility throughout Barcelona, Catalonia, and Spain, and the strong support of the public and private sectors."
Should the high-tech sector care about this kind of labeling? To some extent, it is just hype. Nevertheless, the electronics industry should know where innovation is coming from, and it should figure out how to tap the high-tech hype in a city or country in a way that may move the industry forward.
Maybe it's also time to look more seriously at the self-knighted tech hubs and develop a credible listing based on real-world data. In addition to the number of companies and startups occupying space in the region and listings on local or worldwide stock exchanges, the factors could include high-tech contributions to the GDP, the number of graduating students or residents holding jobs in the sector, the kind of innovations being developed there, and its impact globally.
What would a high-tech hubs list based on factors like these look like? Would Shanghai beat out Boston or New York? Would California's original Silicon Valley ever slip from its top-slot glory?
Anyone up for creating the 2011 Top 10 Next Great Silicon Valleys list?