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September 29, 2010
David Bartlett, the Premier of Tasmania, says that Tasmania is set to become the next Silicon Valley-style technology hub as the national broadband network is implemented over the next three years. It is envisioned that Tasmania will lead Australia in connecting to the global digital economy.
Tasmania, as a technology hub, is part of the Bartlett government building a dynamic and modernised economy structured around five priority sectors for innovation in the state’s economy:
• high-value agriculture, aquaculture and food
• renewable energy
• the digital economy
• a vibrant, creative and innovative Tasmania built on its lifestyle advantages, and
• further growing its tourism advantage.
This Innovation Strategy was first outlined in the New Economic Direction Statement (2008) which re-focussed the state’s economic direction on three key strategies: innovation, skills and infrastructure.
Most attempts at building the next Silicon Valley in other countries have failed. They thought in terms of "innovation in a box" that you can simply build overnight, unconnected to its surroundings, to the culture, to a moment in history.
Margaret O'Mara in Foreign Policy argues that Silicon Valley was based on substantive government contracts, a top-tier university (Stanford) as a research center and networking hub, a venture-capital model, a risk tolerance and meritocratic ethos of Silicon Valley financiers, and competitive amenities that provide a palce where creative, talented entrepreneurial people want to live.
O'Mara, the author of Cities of Knowledge: Cold War Science and the Search for the Next Silicon Valley, says:
The secret of Silicon Valley is that it wasn't a consciously planned silicon city. The Valley exists because of other big forces -- Cold War spending patterns, sustained GDP growth, and large-scale migration and immigration. It prospered because of unique local characteristics like risk-tolerant capital, entrepreneurial leadership, and good weather. It grew organically. It had room for happy accidents and lucky breaks. The not-so-good news for places like Shenzhen's University Town or Russia's Innograd, the high-tech corridor Medvedev wants to create in a woodsy area outside Moscow, is that this kind of ecosystem can't be built quickly from scratch. It takes time to grow, and success will depend on things its builders cannot control.
Even though globalization has changed the playing field, and the technologies that the Valley helped create have brought far-flung places and people together like never before, place still matters, and the right ingredients still make a difference.
It is not clear that Tasmania has the right ingredients to build a high tech hub or a city of knowledge. For instance, it is not clear that the University of Tasmania is like the American research universities that were at the heart of this formation of Silicon Valley: a university as an economic development engine, urban planner, and political actor.
In Silicon Valley universities and their administrators were central to the design and implementation of cities of knowledge, and successful scientific communities often depended upon the presence of an educational institution that not only had extensive research capacity, but was also an active participant in state and local political power structures.
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And since California is now an economic basket case, one wonders why it's such a great idea in the first place.
Enterprises should leverage on their sources of competitive advantage, not try to be a pale imitation of something else. Unless you are South Korea maybe.
Also, provincial politicians should aspire to a firmer grasp on reality.