Sun Setting On Uncle Sam's IT Empire

[Tim May]

On Friday, September 21, 2001, at 04:50 PM, Steve Schear wrote:

> [Note: this is a posting from Dave Farber's IP list. Dave has some 
> interesting points to make about the decline and fall of IT in the US.]
>

I worked in Intel's R&D group for a number of years, and I still know 
many of the researchers. I was there when the mantle of chip research 
was effectively passed from IBM to Intel, where IBM and other computer 
companies came to Intel (and a few other chip companies) to learn more 
so than chip companies looked to IBM.


...
>> The global dominance of the American IT sector was in decline, with its
>> industrial research labs dead and the industry no longer rich, a 
>> leading US
>> researcher and academic told a group of technologists on the Gold Coast
>> this week.

This doesn't match what I know of Silicon Valley. Even with today's 
depressed stock market, the sheer amount of _money_ the leading chip and 
tech companies has dwarfs anything the rest of the world can put 
together.

That someone could argue that the "industry is no longer rich" and that 
the labs are "dead" is ludicrous.

>> Dr David Farber, a former adviser to president Bill Clinton and chief
>> technologist at the Federal Communications Commission, said the US 
>> economy

I hear he runs an interesting list, but as a judge of technology he 
looks pretty flaky.

>> was not healthy and the IT industry was perceived to be in deep 
>> trouble.
>> ``We are seeing the passing of an era in which we did some grand
>> experiments. The net bubble burst with a vengeance. We had forgotten 
>> one
>> very important thing you need a business plan to survive,'' he said.

Plenty of thriving businesses in Silicon Valley and elsewhere.

>> ``Now we are having a healthy dose of reality but it has taken too 
>> long to
>> happen. ``In what was once a rich industry, most companies have backed 
>> off
>> or destroyed their research. We are creating a lost generation.' 
>> [ leading
>> to the lack of new ideas and people to create them] ' The US 
>> Government was
>> going to have to accept that industry could no longer fund R&D. 
>> Innovation
>> would have to come out of the experimental science labs of the
>> universities. It would be up to the universities to generate the next 
>> wave
>> of technology, and to do this they would need government support. If 
>> this
>> wasn't forthcoming, the country's IT would be starved of a future.

Nonsense. The best R&D has come out of industrial labs. The nature of 
R&D has shifted, as the number of basic new discoveries has 
understandably declined.

>> [ I added that there are several research labs left -- most notable
>> Microsoft and IBM and that Microsoft's was in the spirit of places 
>> like the
>> old Bell Labs while IBM was still active but increasingly obligated to 
>> show
>> a profit and thus tended to be short focused]

And I can tell you that almost nothing of importance to IBM or the 
computer industry has come out of the Watson labs in the last two 
decades. A lot more has come out of Cisco, Intel, even Apple.

>> ``We [ the USA] are not alone in this. There are signs of the same 
>> thing
>> happening in Australia. You need to get down to Canberra and help
>> government know what the devil it is doing.''

Yeah, get that government boondoggle revved up in Australia.

What Australia needs is just _one_ major tech company...right now they 
have not a single world-class tech company.

>>
>> Dr Farber is the Alfred Fitler Moore Professor of Telecommunications
>> Systems at the University of Pennsylvania.
>

He doesn't know much about actual industry.


--Tim May