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Software The Almighty Buck Technology

Silicon Valley - Still Important To Tech Advances 77

mrspin writes "This week the The New York Times sparked a lively debate by publishing an article which argued that, when it comes to creating innovative technology, geography still matters — and that Silicon Valley is the place to be. It's certainly true that Silicon Valley, compared with other innovation hot-spots, has the much needed Venture Capital and the connections that enable money to flow from one new company to another. Want proof? ZDNet takes a look at LinkSViewer, a new web-based visual networking tool for exploring capital relationships in Silicon Valley." Is the success of Valley-area projects the result of a more creative environment, or is the cachet of the area (and the resulting money) the reason behind their success?
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Silicon Valley - Still Important To Tech Advances

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  • by usa1mac ( 1002007 ) on Friday February 16, 2007 @01:21PM (#18041446)
    It's like New York and London that have become the major financial centers over the years. These things could move anywhere around the globe, but the connections, infrastructure, and history continue to keep these areas vital. Silicon Valley could remain vital for a long time for all sorts of new technology.
    • by sterno ( 16320 ) on Friday February 16, 2007 @01:47PM (#18041906) Homepage
      Basically what it boils down to is that these areas benefit from the fact that there's already a bunch of people with the needed resources already there. As much as we'd like to think the Internet makes location irrelevant, the reality is that we're social creatures and we'll always have an affinity for meeting people in person. We get jobs, build companies and get investment, primarily, through the social networks we create. It's possible to do these things without social networks but it is WAY harder.

      In my career since College I've worked in two cities and have worked in five companies. Of those five companies, I was hired totally cold by only one of them. In all the other cases, I knew somebody who worked for the company who I'd worked for/with in the past and was able to use that to get my foot in the door. Now take that concept and multiply it thousands of times amongst the social networks that develop in a limited geographic area with a strong focus on a particular kind of business.

      So I think ultimately it's less about the cash in the valley, and more about the people there. The cash follows the people and the ideas.
      • I'd say the social element is the most important. When it comes to things like business deals or hiring the human element matters more than some people would be willing to admit. There are a lot of deals based mainly on trust and personalities.
        • How many IT people out there have been forced to use second rate software because that's what was sold to their boss by the guy he plays golf with? :)
          • by Ziest ( 143204 )
            Please, I just finished lunch. While we are at it how of us had some half-ass development methodology forced us us because one of the bosses friends did it in his company and he got a raise.
      • Of those five companies, I was hired totally cold by only one of them. In all the other cases

        And I bet that's the company you would go back to if given a choice?

        I find that employment through a rigorous process, i.e. cold, yields a better long term career--you work hard at it and you expect the company to follow up and treat you well. And you don't have the social ills that come with using your network: your rated by merit and if you leave, you'll be sure why you did vs. the politics of a network. A lot

        • That company laid me off and shut down the office a year later :)

          Also, I think a lot of it depends on the nature of the network and how you use it. My take is to use those relationships to establish credibility, that is, I expect I can get the jobs on my own skills, but knowing somebody helps establish that when you say you can do something you're in fact capable of it.

    • by Anonymous Coward
      The new Silicon Valley (SV) is not in the USA. The new SV is located in Bangalore, India and Shanghai, China. Ebenezer Scrooge [wikipedia.org]...errr... Microsoft can buy 5 Indian/Chinese engineers for the price of one American engineer.
    • It has more to do with the big guys rubbing elbows than anything else. It is far easier to share titles on boards with your friends and their companies if they are somewhat geographically close.

      In the late 90's people were flocking to the valley to write web pages for 90 and 100 thou. They got there and found rent on an apartment took a big chunk and then they were spending hours in traffic. And each and everyone that showed up drove prices higher and made traffic worse. Part of the tech crash was simpl
  • IMO, the creative process there is no different than if it was done in Orlando, fl. Money has a funny way of enabling corporate synergies. Ahh, there, now I've satisfied my daily quota of BS-speak.
    • by Rycross ( 836649 )
      To add to that, Silicon Valley has a lot of qualified computer scientists, software engineers, and programmers partly because of the inertia that it gained back in the 90's. During my job search in 2005, I ran into a couple entrepeneurs that moved their business into the valley. I asked them why they made the move, they said to find more qualified people and to get more capital invested into their businesses.
      • Re: (Score:3, Insightful)

        by Thanatopsis ( 29786 )
        Back in the 90s? You realize that the tech boom started literally decades ago right? The 90s themselves were the result of the investment infrastructure from the previous tech boom - the personal computer.
        • by Rycross ( 836649 )
          Forgive me for my lack of accuracy, it was before my time.
        • "Tech" is not necessarily always computer-related although computers do play a substantial role. Materials science, for example, has been making a big difference because engineers (not software or computer "engineers") have started becoming more specialized in focus.
      • Silicon Valley has a lot of qualified computer scientists, software engineers, and programmers partly because of the inertia that it gained back in the 90's.

        Don't you mean 1980's? The 90's tech bubble seemingly came out of Silicon Valley because it was already important to computer technology. Moreover, it had already been in the public eye for a very long period of time. If you don't believe me, go rewatch the pilot episode of Knight Rider: Knight of the Phoenix.

        • by Rycross ( 836649 )
          Yes. Its my mistake, I never really bothered to learn timelines for a lot of tech that I use today, and I wasn't even born in the early 80's.
    • I grew up in silicon valley [insert screed about disappearing orchards here]. One of the factors that keeps our area relevant is the networks of people who self-select, around a given technology. The video nerds at Apple and Adobe know each other, and the YouTube kids probably went to La Costena for burritos, same as the Googlers. People and proximity still matter.
  • I disagree (Score:2, Funny)

    by Mikachu ( 972457 )

    Silicon Valley is the place to be

    /blockquote I disagree, I'd have to say I'd prefer Silicone Valley. It's a lot more attractive of an area. ;)
  • Certain places will always be known for certain things... I work in Hartford, CT - Insurance Capital of the World... well maybe not so much anymore, but having a Hartford presence just makes sense - there is a large pool of insurance specialists - in IT, Finance, Underwriting, Accounting, Actuary... Same goes for Silicon Valley, and the loop around the Boston suburbs... software blood will always run thick in those places.
    • Where ever the money is, that's the geography to be in.
      • by kfg ( 145172 )
        I'm reasonably forthright in my distaste for Manhattan, yet as a musician I find myself going there at every reasonable opportunity. Why? It ain't for the "scene," it's because that's where they keep the money. I go to Staten Island because that's where they keep the musical instruments because Manhattan is where they keep the money. I go to Queens . . .

        Yeah, right. Get real.

        KFG
        • Re: (Score:3, Funny)

          by geekoid ( 135745 )
          Wow, no matter how many times I read that I think your making a different point. You should go into politics.
          OTOH, maybe this cold medicine is screwing with me.

  • Silicon Valley is better for "brave, new world" revolutionary innovation, but not necessarily for "better, faster, cheaper" evolutionary innovation. Advances that require building on years of previous knowledge require more stability than the Silicon Valley environment can provide. Example: more successful microprocessor design is done in either Oregon, Haifa, Austin, New York (IBM), etc. than in Silicon Valley.
  • positive feedback loop. Fueled by Standford and the initial tech boom it has become a self sustaining cycle with each new crop of entrepreneurs being fed by the next.
    • by Ungrounded Lightning ( 62228 ) on Friday February 16, 2007 @02:42PM (#18042742) Journal
      The positive feedback loop is a big part of it. It produces a pool of trained people from whom you can hire the skills you need on short notice and without paying relocation expenses and "moving away from where the action is" penalties.

      But another factor is a small but very important piece of IP law in California:

      If an employee makes an invention, on his own time, without using company materials or resources, and it's not in the company's immediate or likely future business path, it belongs to the employee. No matter what the employment contract says. (The contracts generally explicitly include one page which IS this provision.)

      The result is that people who invented something that their company wouldn't be developing could rent the building across the street and build their own startup to develop and market it. And many of them did - and did it again a couple years later - repeat for decades.

      The result is that startups budded off and grew like a yeast culture.

      Any other state that wants to build its own version of Silicon Valley needs to clone this provision into their own state law.

      If this is done, and they can provide an alternaive to California's high crime, high tax, and oppressive political-correctness, they might see an even bigger boom in one of their major university towns.
  • by xRelisH ( 647464 ) on Friday February 16, 2007 @01:52PM (#18041992)
    Sure, entrepreneurs are the ones that think up of the new ideas and lead the innovations, but nothing would get done without talented developers. It just happens that skilled developers tend to migrate toward the Bay Area because of the high density of good companies. This in return, encourages more startups and we start seeing even more talented developers flocking to the Bay Area. It's kind of self-renewing and I don't see it going away any time soon (save some catastrophic earthquake...).
    • Re: (Score:2, Insightful)

      by Hoi Polloi ( 522990 )
      But who the hell can afford to live there anymore? You have to be a millionaire to live in a tiny ranch house (if even that).
      • But who the hell can afford to live there anymore?
        Prolly the people who live there. I still work in the valley but live in a decent-sized apartment in what's supposed to be one of the wealthiest areas of San Francisco, but it's actually quite affordable for renters.
  • Reputation Matters (Score:4, Interesting)

    by Peter Trepan ( 572016 ) on Friday February 16, 2007 @02:03PM (#18042160)

    Alabama is proof. We have one of the top research hospitals in the United States [wikipedia.org]. We have a whole city full of freaking rocket scientists [wikipedia.org] which incidentally has the nation's highest concentration of engineers. Jimmy Wales [wikipedia.org] grew up here. We had three winners on American Idol (who no one cared about until then) and lots of good local bands (who no one cares about now.) Every generation, Alabama produces enough interesting people to completely replace the asshats who are responsible for Alabama's history - but then they all move, leaving the same old rednecks in charge.

    Reputation is a self-fulfilling prophecy. It's the sole reason why Alabama is still socially conservative.

    • If you hate it so much, why don't you move?
      • I may.

        There are advantages to living here. The cost of living is very low. I like my job. Should I lose it, I know a number of people in the local industry. And if I'm moving to find a different culture, that's going to have to be a long move.

        On the other hand, I might discover I have people skills if I move somewhere with different people.

        • If you have people skills, you can get along with people anywhere. It doesn't take skill to get along with people who think just like you.

          Not that there's anything wrong with wanting to live amongst people who think similar to you, just saying that you might find yourself well-served by honing your people skills in an area where it really is a challenge to do.
          • It doesn't take skill to get along with people who think just like you.

            Bravo. If you can't get along with someone of a different political persuasion, then you're taking life WAAAAY too seriously. Take the cork out your ass and start acting human.

            I'm a radical libertarian. My best friend in college was an affirmed and unashamed marxist. We had no problems getting along, even when discussing politics. But something has happened in the subsequent years. People on the left stopped talking to people on the righ
            • by mdfst13 ( 664665 )

              I'm a radical libertarian. My best friend in college was an affirmed and unashamed marxist. We had no problems getting along, even when discussing politics. But something has happened in the subsequent years. People on the left stopped talking to people on the right, and vice versa. They isolated themselves into insular enclaves.

              Radical libertarians and Marxists have a lot in common. Both think that the current economic system is crap and should be replaced with a radically different system. Both decry the way that big business uses government to maintain itself (although they have very different views on how to fix that; i.e. reducing government power versus shifting the flow of control towards one where the government runs the business). Depending on the brand of Marxist, both may believe that government should stay out of pe

          • It doesn't take skill to get along with people who think just like you.


            I can get along with people who disagree with me. The problem comes in when all the people who disagree with me agree with each other.

    • Having watched Top Gear last week, I'm wondering why anyone would want to even visit Alabama, let alone live there.
  • Wow, look at this. As Everynicklstaken says:

    "ZDNet did not take a look at this. You took a look at this, and posted it to your ZDNet blog.
    Full disclosure = A good thing."

    Everynickelstaken's post is a little lost down there. I think it should get more play.

    Click on: "ZDNet take a look at this and you get: http://blogs.zdnet.com/social/?p=93 [zdnet.com]
    and you get "Steve O'Hear," ZDNet blogger extraordinaire.

    Click on "mrspin" and get this: http://www.insearchofthevalley.com/ [insearchofthevalley.com]

    and you get "Steve O'Hear" again!

    Kind of recurs
  • tends to stay in a given area. It doesn't like to move. It creates laws and social structures to protect itself (or the humans who work for it do). Once the protection is in place, its almost impossible to move it somewhere else. Only a heavy disaster or economic devistation will get rid of it, and then only because the protection is gone.

    The Valley will continue to be important for as long as California can keep the funding and investment laws in place.
  • People like Steve Jobs, Larry, and Sergey have created an environment of pseudo-celebrity that feeds itself here in The Valley. Nerds (like myself) flock to the place in order to gain a social status that was unheard of pre-.com.

    It's turned in to a cyclical thing now as the VC's came here to be bigwigs in something else besides entertainment and, of course, they want to be close to their money, so they make sure the companies they're pushing stay local.

    Plus, Northern California is a pretty decent pla
  • "exploring capital relationships"???

    Whatever happened to the good, old, straightforward begging for cash???

  • by heroine ( 1220 ) on Friday February 16, 2007 @04:08PM (#18044136) Homepage
    Technology is forcing people there by eliminating anything that doesn't require face to face communication. To be employed, you have to do things that require physical presence in the same place as your peers. Otherwise, you might as well be in Siberia.

  • Is the success of Valley-area projects the result of a more creative environment, or is the cachet of the area (and the resulting money) the reason behind their success?

    Neither. It's the fact that there is a concentration of engineers here. As simple as that. If you start up a software development company, you want to hire software developers. Guess where you'll find software developers? In Silicon Valley! That's also where you'll find sales and marketing folks with a software development background. Most p
  • Yes, Silicon Valley is still important.
    As a geographical location.
    The same as Queen is important for England today.

    Yet it does not mean that Silicon Valley location is a panacea, or some sort of passing score.

    The really successful startups don't even need venture money. Did you hear that?

    Some companies are in Chicago, others are in East Coast, and some are in garages.

    What really important is who in this garage, and not where it is located.

  • Keep your executives, your deal makers, your evangelists out in the Valley but put your engineers in hotspots like Austin or Research Triangle Park. Why the hell would you want to pay engineers to work in Silicon Valley when the cost of living expenses are so high that your HR dollars will go almost nowhere?
    • Re: (Score:3, Insightful)

      by aquarian ( 134728 )
      Maybe your engineers would rather live in the Bay Area, despite the cost of living* -- to enjoy the world-class cosmopolitan atmosphere and cultural amenities, recreational opportunities, natural beauty, and freewheeling cultural vibe that embraces freethinkers and innovators.

      Frankly, I can't think of any place more boring, stifling, and backward than the suburban sprawl of North Carolina.

      *There's a reason the Bay Area cost of living is so high -- it's called supply and demand.
      • "Frankly, I can't think of any place more boring, stifling, and backward than the suburban sprawl of North Carolina."

        This sort of tripe usually comes from people who have either never lived in North Carolina, or never bothered to leave the confines of CARY. The Triangle is actually a pretty great place to live. We have lots of great things to do, a very diverse population, high concentration of tech geeks, and a rapidly building undergound art/music scene.

        If you come here with preconceptions of what to ex
  • It scores a lot of runs but also leads the industry in strike-outs.

    I think that the dot-com dumbness was mostly confined to the SV (except for the investors). At least I didn't see those software developers that were in it only for the money in my area.
  • and its main importance is that it's "where the money is". I was happy to move out of there, and money is the only reason I can think of for going back even for a visit.

    One can make a case for living within a local UPS radius from SV to make ordering stuff (as in physical) out of there, but if one has the good fortune to live within a reasonable distance of a Fry's, that's almost as good.

    I think that unless one's VCs insist that one put the startup in SV, it's a lot more cost-effective to find a place f
    • Er, last I checked, Google started in Palo Alto (at Stanford as Larry and Sergey's research) and moved on to Mountain View. Both are in the heart of the valley. Sure, now they're building out offices everywhere, but they certainly started in the valley.
  • between VCs, startup capitalists, journalists, etc. in SV (I'd call it an ecosystem) may be more of a barrier to getting radical new technology done than an accelerant.

    The problem here is that the "low hanging fruit" in terms of ideas within that network got mined out years ago, and if you're outside the network, good luck in getting a hearing regardless of how "outside the box" or how good it is, you'll need it.
  • Bay area has dominated, and Boston is not far behind, and has been heating up lately -http://business.bostonherald.com/businessNews/vie w.bg?articleid=177352 http://akorri.com/ [akorri.com] These areas have the technical skills, universities, tech acquirers, and money. The VCs are able to incubate a lot more potential winners when you have these factors all in one place.

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