Could One of These Cities Be the Next Silicon Valley?May 05, 2016 by Kate Smith
Cities around the globe battle for the title of "The Next Silicon Valley". Here are four candidates and how they measure up.
The term "silicon" has become associated with technological advancement and economic growth. Everybody wants to be "The Next Silicon Valley".
There are plenty of places given a nickname with "silicon" in it. Nairobi, Kenya is known as the "Silicon Savannah". Scotland has its own "Silicon Glen" area. Davao City, Philippines would like to claim the name "Silicon Gulf".
But few cities can come close to Silicon Valley's startup environment, investment resources, and pure tech innovation. Today we'll take a high-level look at four cities that hope to rival Silicon Valley's hold on the tech industry:
- Shenzhen, China
- Bangalore, India
- Campinas, Brazil
- Skolkovo, Russia
Comparison to Silicon Valley
In order to understand how these four areas compare to Silicon Valley, we first need to look critically at Silicon Valley, itself.
Population: 4 million
GDP: $275 billion
Education: University of California, Berkeley: Berkeley, California, Stanford University: Stanford, California, San Jose State University: San Jose, California, Northwestern Polytechnic University: Fremont, California, Carnegie Mellon University: Mountain View, California, Santa Clara University; Santa Clara, California, University of California, Santa Cruz: Santa Cruz, California
Notable Companies: Advanced Micro Devices (AMD), Agilent Technologies, Alphabet Inc., Apple Inc., Applied Materials, Brocade Communications Systems, Cisco Systems, Electronic Arts, Hewlett Packard Enterprise, HP Inc., Intel, Juniper Networks, KLA Tencor, Lockheed Martin, LSI Logic, Marvell Semiconductors, Maxim Integrated Products, National Semiconductor, NetApp, Nvidia, Oracle Corporation, SanDisk, Sanmina-SCI, Western Digital Corporation, Xilinx
Silicon Valley is where the first microprocessor was developed. It’s home to hundreds of hardware manufacturers and hundreds of thousands of engineers. The founding of the Stanford Industrial Park (now the Stanford Research Park) in 1953 kickstarted the area’s grasp on technological research, development, and investing. Financially speaking, Silicon Valley is the home of the most robust technological investments on the planet.
Engineers and investors from all over the planet come to Silicon Valley. It is, without question, the single most important location for hardware development in the world.
Population: 10.7 million
GDP: $270 billion
Education: Shenzhen University, Shenzhen Polytechnic, Shenzhen Institute of Technology, Shenzhen Institute of Information Technology, Shenzhen Graduate School of Harbin Institute of Technology, South University of Science and Technology of China, Shenzhen Institutes of Advanced Technology (Chinese Academy of Sciences)
Notable Companies: HAX Accelerator, BYD, Konka, Skyworth, Tencent, Coolpad, ZTE, Gionee, TP-Link, DJI, BGI (Beijing Genomics Institute), OnePlus, Huawei
Shenzhen has been hailed as China’s Silicon Valley for years. Located north of Hong Kong, it has a direct line to international economic developments.
Of particular note for our purposes is the presence of HAX Accelerator, a seed accelerator company focused solely on supporting hardware startups.
Many argue that China’s strongest tech offering is Zhongguancun, located just outside of Beijing. However, Zhongguancun doesn't yet have the same number or caliber of manufacturers, investors, or educational facilities available. It's possible for Zhongguancun to catch up to Shenzhen, especially given its fame within China as "China's Silicon Valley". For now, though, Shenzhen appears to be in an uncontested lead for the title in practice.
Population: 8.4 million
Economics: Over $15 billion in IT exports per year (Rs 1,00,000 crore)—2015 estimate
Education: M. S. Ramaiah Institute of Technology, Indian Institute of Hardware Technology, University Visvesvaraya College of Engineering, R.V. College of Engineering, PES Institute of Technology, BMS College of Engineering, M. S. Ramaiah Institute of Technology and Bangalore Institute of Technology.
Notable Companies: Infosys, Wipro, Mindtree, Mphasis
Bangalore’s tech economy is divided into three main groups: Software Technology Parks, the International Tech Park, and Electronics City. Combined, these clusters make up an industry that contributes over a third of India’s IT exports.
Bangalore is a relatively new addition to the “silicon” game. It’s been just about a decade since the New York Times asked, “Is the Next Silicon Valley Taking Root in Bangalore?” Because the area has been attracting large numbers of young tech companies over a relatively short time period, it suffers from occasional infrastructural limitation, including insufficient power grids. These issues are likely to persist until the Indian government invests in the infrastructure of Bangalore.
In Bangalore's favor is its reputation as a stronghold of education. This is analogous to Stanford's involvement in building Silicon Valley. After all, there are no engineers without solid educational opportunities.
Another up-and-coming Indian hub to watch is the Pune-Mumbai Knowledge Corridor, trailing Bangalore by around $6 billion per year in exports.
Population: 2.6 million
GDP: $11.4 billion
Education: University of São Paulo, Federal University of São Carlos, São Paulo State University (UNESP), University of Campinas (UNICAMP), the Pontificial Catholic University of Campinas (PUCCAMP), the FACAMP, the UNISAL (Centro Universitário Salesiano de São Paulo), the Center for Research and Development in Telecommunications (CPqD), the National Laboratory of Synchrotron Light, the Renato Archer Research Institute (CenPRA), the Biological Institute, the Eldorado Institute, the Werner von Braun Institute, ETE Bento Quirino (Escola Técnica Estadual Bento Quirino), ETEC (Escola Técnica de Campinas), ETECAP (Escola Técnica Estadual Conselheiro Antonio Prado), POLI Bentinho (Colégio Politécnico Bento Quirino), COTUCA (Colégio Técnico da Universidade de Campinas), SENAI (Serviço Nacional de Aprendizagem Industrial)
Notable Companies: IBM, Lucent, Samsung, Nortel, Compaq, Freescale Semiconductor, Motorola, Dell, Fairchild Semiconductor, Huawei, 3M, Texas Instruments, Celestica,Solectron, Bosch
Campinas, a smaller city 60 miles north of São Paulo, is a notable area for hardware development in particular. Campinas has been involved in areas like fiber optics, biomedical technology, and integrated circuits, among others.
Originally a rural agricultural center, Campinas has swiftly developed over eight technology parks over the last 50 years, including "TechTown" and "TechnoPark".
Like Bangalore, Campinas has education on its side. UNICAMP, the Universidade Estadual de Campinas, is renowned for its engineering courses.
Competing for the title of “Silicon Valley of Brazil” are Florianópolis and São Carlos. Florianópolis is located in the Brazilian state of San Catarina, but São Carlos is located in São Paolo (a mere two hour drive from Campinas), making the state an example of flourishing technological development. Perhaps in the future São Paolo will become a collective tech hub— this would parallel Silicon Valley, which spans San Matteo and Santa Clara counties in California.
Population: 325 (as of 2005); 21,000 (as of 2016)
GDP: ??? (Projected contribution to Russia's GDP for 2030: $22.7 billion)
Education: Open University Skolkovo
Notable Companies: Nokia Solutions and Networks, Siemens, SAP, Microsoft, Boeing, Intel, Cisco, Dow Chemical, EMC Corporation, IBM, Johnson & Johnson, Ericsson, Alstom, EADS
Skolkovo is an example of a meticulously planned technology center. In 2010, the Russian government declared that they would be creating a tech park in the suburb of Skolkovo. You may notice that the population experienced a veritable explosion within the last decade. This is because the Russian government chose Skolkovo based on its land rather than on its demographics or preexisting infrastructure.
Did we miss a city or area that deserves to be on the list? Got some stats we need to add? Let us know in the comments.