Many (most) countries in the world have in the decade just passed, developed and at least partially implemented what may be called a “digital development strategy”. These strategies are based on a perception that the kind of economic activity that has resulted from the technical/digital development taking place in Silicon Valley and similar such locales particularly in the US is a necessary element of the economic development strategy for any/every country that wants to be competitive and thus prosperous at this time in economic history.
The perception is that the well funded science and technology programs at the leading universities in the San Francisco and California region—Stanford, CalTech, UC Berkeley and so on attracted faculty and produced students whose leading edge work contributed more or less immediately and directly to the generation of technology innovations which in turn led directly to the creation of start-up technology enterprises. These mixed with fairly ready availability of investment capital, in turn sparked the technology (and commercial) digital revolutions of the Internet and other digital enterprises. In turn these enterprises provided the basis for economic advance and importantly (from a government’s perspective) job creation and enhancements to the national revenue stream through taxes and so on.
This logic is probably correct at least in outline (but would be worth examining in some close detail) however, what is rather less obvious is that this model can (or should) be reproduced not just once or twice but repeatedly in tens and hundreds of locations around the world—Silicon Peninsula (Dalian PRC), Silicon Alley (NYC), through Silicon Vinyard (Okanagan, BC, Canada) and so on; to the point where there is a Wikipedia site simply documenting and listing these and pointing to an even more comprehensive site called Siliconia.
Not surprisingly, attempting to reproduce these developments has become something of an industry in itself for certain institutions (most notably perhaps MIT with its string of (largely failed) international Media Labs and international consulting firms. Making an argument against the possibility of reproducing these results is somewhat contentious given the resources which have propelled the attempts in this direction however, it is fairly widely acknowledged that the specific ecology that contributed to the development of Silicon Valley and its counterparts elsewhere in the US is one that is difficult and extremely costly to reproduce. As well, it is much more easily reproducible when a number of the pre-conditions already exist as for example, a very well-established university and research system–creating what is generally termed as Highly Qualified Personnel (HQP) and a strong set of technology traditions and extraordinary available funding as for example is available through defense research programs.
Whether these ecologies can be reproduced is one thing, whether the attempt should be made to reproduce them is something else. There are certain things about digital technologies which suggest that perhaps this should be approached with considerable caution:
- the nature of most Silicon Valley (SV) types of technology development is “winner take all” that is the first to capture the market keeps the market and there is little room for additional suppliers/competitors in the field
- Silicon Valley types of development are probably net destroyers of employment for an economy overall rather than contributors in that they encourage and contribute the automation of previously manual processes while themselves only creating a limited number of jobs in he domestic economy.
- all of the other SV’s start with significant competitive disadvantages in relation to their emulators
- a likely effect of significant investment in developing HQP in anticipation of a SV type of development is in fact to be training domestic personnel so that they can then begin to participate in and compete for employment in the international technology marketplace and thus have opportunities for emigration (and contribution) to US and other technology poles rather than to domestically research.
- the contribution of local investment in HQP and other technology development makes relatively little overall contribution to other areas of domestic development and rather more to internationally focused technology development supporting the dominant players in those market place.
In fact, it is quite possible that a “SV” strategy will have only limited impact and certainly nothing like the transformative economic benefits which are generally ascribed to the investment being made.
Let’s be somewhat more realistic about the economic circumstances opportunities in second and third tier countries:
- many countries are suffering from quite severe rural urban migration as many, particularly the younger and better educated migrate from rural areas including rural smaller communities to larger urban areas and particularly capital cities.
- many countries are suffering from severe youth unemployment including unemployment among recent post-secondary graduates
- rural economies overall suffer from a lack of innovation and capacity to support and promote innovation
- rural population centres in many countries suffer from a lack of skills and an overall lack of services associated with participating in a contemporary economy
- shifts of population from rural to urban areas are a significant contribution to urban degradation and in many cases present an overall social problem.
Given this circumstance one wonders why little or no attention/resources are directed towards developing capacity for innovation including technology enabled innovation at the local level and making a contribution to local development and particularly among rural and marginalized populations.
Thus for example, rather than, or perhaps better, in addition to making huge investments in advanced science and technology training, laboratories, internationally recognized university faculty, and so and so on, perhaps a rather more substantial impact on a domestic economy could achieved by establishing programs for training young people to become locally community informatics officers—providing the basis for Internet access, local training, support for local innovation, support for local business development and business adaptation towards the integration and effective use of Information and Communications Technologies (ICTs) and so on. What would be needed rather than state of the art computer science and engineering programs would be programs training young people in working in their local communities and having an understanding both of local community processes and how ICTs could be an enabler for local economic and social development.
Since in many cases the young people could be encouraged to return to their home communities they would have an intuitive understanding of local needs and opportunities and would be able to “hit the ground running” since they would begin from a platform of sympathy and trust. In addition, they would help to maintain and revitalize rural communities and inner city neigbhourhoods which are currently suffering from depopulation of their skilled young people and they would be much more likely to settle down locally rather than subjecting their employers to the costs of continuous turnover.
Since many real innovations come from finding innovative ways of addressing local problems it is possible, even likely, that a program to support locally developed innovation as might emerge from a program such as this might in fact foster significant and more broadly competitive technical and enterprise innovation (one need only look at the types of innovation currently emerging from the local cell phone cultures in Africa as an example of this).
So rather than adding to the lists of (mostly failed) Silion whatzits, perhaps national governments could begin to develop digital development strategies focused around the development and deployment of Community Informatics Corps into rural areas, villages, low income neighbourhoods and in this way make effective and lasting contributions to not only “bridging the digital divide” but more importantly to revitalizing communities and re-energizing local economies . In this way governments would, and not incidentally, very likely be making rather more lasting and cost effective economic contributions at a national level as well.
Franz Nahrada
August 2, 2010
Very well outlined, Michael. We are just now examining a strategy in these lines in the village of St. Martin in Austrias WoodQuiarter. Its an extended village of about 1000 people embedded in a cooperative and dynamic microregion – that has managed to implement an Open Access Network OAN based on fiberoptics when the Telecoms did not give a damn. Now they are facing fierce competition, but doing well.
So we are now struggling with the outline of a “village in the village” to give an incentive to young qualified people to stay in the region. We feel there needs to be a certain common specialisation, for example audiovisual media, and a workchain clustering around products and services that immediately manifest in the local economy as well.
For example content production in conjunction with local enterprise and local services (we work on dedicated support for elderly people).
We would like to get in touch with other well-nested “microsiliconvalleys” around the world.
Michael Gurstein
August 2, 2010
Franz, very interesting case. I’m wondering though whether the whole conceptualization around “silicon valleys” may not be misleading and misdirecting… “Silicon Valley” suggests to me the idea of developing world competitive technology. where I’m thinking that the most likely and rewarding benefits of local ICT enabled developments of this kind will come from local innovations and local digital transitions–enhancing local (or perhaps regional) competitiveness and economic vitality.
A locally focused community informatics strategy may result in broader innovation and markets but I don’t think that this can or should be the goal since I would very strongly question whether one could go very far in that strategy beyond a very few winners and a very large number of losers.
Franz Nahrada
August 2, 2010
I used the term “MicroSV” for two reasons:
* To show that there must be a fraction of activities that attract income from Global markets
* To show that there is a need for clustering of IT professionals in their regional circumstance.
Michael Gurstein
August 2, 2010
Franz, I agree that these are desirable, I’m just not sure why you think that they are necessary–especially given how difficult they are likely to be to successfully achieve.
My argument is that parallel or redirected investment from SV oriented types of digital development strategies to community informatics strategies are likely to show results which are better for the overall well being.
Franz Nahrada
August 3, 2010
I totally agree with you, but then again the question is: how do we provide basic monetary streams to sustain our technological and economical standards. If we can reverse the game as you outline, then there is simply a principle to participate only in those fields of virtual global production where there is really demand – and not be dependent on them. Thats half of the success conditions.
Nevertheless especially services based on IT seem to be one of the most plausible sources of external income that a region could possibly have – if it finds the right niche and the right partners.
Its strange to see the justaposition in our points, you know that I totally value and support local development and even intentional solidarity economics. But we can only do 80% locally and therefore even the soundest strategy has a teleservice component. We agree that in almost all cases local economy building has to be on top of the goal chain nowadays.
patrice
August 3, 2010
Excellent article, Michael, and I was (not so) surprised to see how parallel the argument for SVs runs to the broader ‘Creative City’ one: same (sort of) actors, same intellectual and political laziness, same delusions – and waste of resources.
Tiago Assis
August 9, 2010
Great article Mike.
I totally agree with you, I’m particularly identified with the conclusion. Nowadays, I guess that even for the “developed” countries, the Silicon Valley model is obsolete. I strongly believe in models that can be build from Community Informatics in rural areas, villages and underdeveloped countries. Also, what we can learn from those experiences in those environments, will have a changing impact on our models at the urban areas, cities and “developed” countries.
Michael Gurstein
August 9, 2010
Tks Tiago, I completely agree with you.
Tiago Assis
September 2, 2010
“Silicon Valley is the only place on earth not trying to figure out how to become Silicon Valley” Robert Metcalfe in 1998
Tiago Assis
September 2, 2010
Metcalfe’s full article