Where is the next Silicon Valley? China according to latest survey

As an online magazine that focuses on global innovation, we’re constantly bombarded with innovation news and innovation events around the world. It’s difficult to turn in any direction or attend any event without being told about the benefits and need for innovation, innovation clusters, science parks, smart cities and much more.  Additionally, with a name like ‘The Next Silicon Valley’ we’re always asked where we think the next Silicon Valley is located.

The answer to the latter may be partly answered by the latest survey results from KPMG in its 2012 Global Technology Innovation Survey, in which 44 percent of respondents thought it likely that the technology innovation center of the world would shift from Silicon Valley to another country within four years. Reading between the lines, it’s perfectly feasible to think that this other country could be China – and our interview with leading electronics industry technology journalist Peter Clarke earlier this year, ‘China: Becoming Silicon Valley’ gives a lot more credence to this argument.

Is China going to be home of the next Silicon Valley?

In the survey, respondents in the USA obviously thought that the shift from Silicon Valley was unlikely – which is understandable, given that in the USA it is unthinkable that any other country or region can be better. One VC advisory firm in Silicon Valley told me on a visit there in May this year, “That’s ridiculous – no other region can be like Silicon Valley”.  While it’s true that the mix of factors that make Silicon Valley is unique, it is difficult to convince some in the Valley that there is innovation and competition going on around the world.  As Thomas Friedman and Michael MandelBaum comment in their book ‘That used to be US – how America fell behind in the world we invented and how we can come back’ – this is one of many wake-up calls for the USA.

The KPMG survey comes from the firm’s Technology Innovation Center launched on 27 June 2012 to look at identifying and evaluating the impact of future disruptive technologies in the technology sector, and headquartered in Santa Clara (Silicon Valley), California, USA, with physical hubs in Cambridge, Massachusetts, USA, and Bangalore, India.

Gary Matuszak, partner, global chair and US leader for KPMG’s technology, media and telecommunications practice, commented, “The pace of technology innovations today is happening at unparalleled speed and China’s projected rapid rise to prominence as a technology leader would be another example of this. China’s anticipated parity with the US tech sector shows the significant challenge facing the US to retain its position as an innovation leader. Other countries will continue taking steps to boost technology innovation and to attract tech entrepreneurs.”

His colleague in China, Egidio Zarrella, adds, “These survey findings also demonstrate that China’s innovation investment has fostered an environment for the development of disruptive technologies that is growing by leaps and bounds. The Chinese Government is encouraging significant investment in three key areas: shared services and outsourcing; payments and cloud computing. The 12th Five-Year Plan is also driving innovation in these critical areas, in order to create a nationwide virtual environment.”

The survey asked respondents whether their education system serves as an incubator for innovative thinkers, and slightly more than half believed this was true. In China, close to 75 percent thought this was true, while in the US, less than half thought so.

Who are the top global innovators?

In considering innovation drivers, visionaries and leaders, more business executives globally identified Apple, now led by Tim Cook, and former CEO Steve Jobs, as top in all three areas. In terms of driving disruptive innovation, Apple was followed by Google and Microsoft, according to the survey. Respondents also viewed Jobs as the top global innovation visionary, followed by Bill Gates. In China specifically, executives said Gates was the top visionary and Jack Ma the innovation leader. In India, Infosys was identified as the innovation leader, and in Israel, it was IBM.

At the same time, about one-third globally pointed to Google, Facebook and Amazon as emerging leaders in mobile commerce.

The KPMG survey was based on responses from 668 business executives in the Americas, Asia Pacific (ASPAC), Europe, the Middle East and Africa (EMEA).

The Next Silicon Valley team will be at the Global Innovation Summit in San Jose, CA, USA (16-18 July 2012), where we are an official media partner.  We’re looking forward to hearing more on the debate around global innovation and clusters.

Nitin Dahad, CEO & Publisher, The Next Silicon Valley

Share This Post