The US has always been the place where tech companies around the world wanted to set up or do business. When I started at National Semiconductor in the UK in 1985, I saw how colleagues aspired to relocate to Silicon Valley, the epicenter of tech, and this has continued for many years. But the signs are that policy changes being implemented by the new US administration could be hurting US innovation.
According to Maxwell Wessel a general manager of SAP.io, writing in the Harvard Business Review, whereas for many years companies from around the world have flocked to build innovation centers in US locations like Silicon Valley and New York, this could be adversely affected by the new policies around talent and foreign trade and investment. He says, “If we want to preserve our position at the forefront of the innovation economy, we must act more thoughtfully when creating policy.”
In the article, Wessel cites several examples where it’s already impacting the US. One is a European technology business he invested in that was due to set up in San Francisco, to launch its first product for the US market. With the Bay Area being the heart of innovation in the software industry, setting up there to bring their businesses to life is the dream of many tech founders. While the entire European team maintains German citizenship, one of the employees, a German college student, had dual Syrian citizenship. At the last minute, she was informed that she could not enter the US due to the new administration’s executive order on immigration.
Another example he cites is related to companies and countries already being wary of relying on US technology firms due to the perceived risks of government-sanctioned backdoors in a post-Snowden world. He says a major IT buyer he was talking to suggested that it might be prudent to forgo the best US-based software vendors to work with foreign competitors that are beyond the reach of US executive orders. Hosting the company’s critical business data and intellectual property in US data centers suddenly became a real concern when opaque executive action might threaten their privacy at any moment. Wessel says for the first time, he was seeing in the US the same type of concern over losing intellectual property or sensitive financial information that is normally only associated when working companies with some companies and institutions in the Far East.
While foreign investors and customers have trusted American companies in the past because of competitive products and a stable and predictable environment, he adds that with the promise President Trump made to bolster the American economy, the executive orders signed so far could just undermine that goal.
To read the full article: “The President’s policy changes are already hurting US innovation.”
[Photo credit: The Science of Science Policy (SoSP)]