Tech leaders say Silicon Valley's edge is growing duller

[David Farber <dave () farber net>]

-------- Original Message --------
Subject: 	[Dewayne-Net] Tech leaders say Silicon Valley's edge is 
growing duller
Date:   Mon, 21 Nov 2005 08:02:04 -0800
From:   Dewayne Hendricks <dewayne () warpspeed com>
Reply-To:       dewayne () warpspeed com
To:     Dewayne-Net Technology List <dewayne-net () warpspeed com>



Tech leaders say Silicon Valley's edge is growing duller
Those at San Jose meeting agree U.S. innovation is threatened by red  
tape, poor schooling
- Verne Kopytoff, Chronicle Staff Writer
Thursday, November 17, 2005
Burdensome federal regulations, mediocre public education and  
restrictive immigration policies are dampening Silicon Valley  
innovation, putting companies at risk to rising giants in China and  
India.

That was the consensus of several technology luminaries speaking  
Wednesday in San Jose at a conference hosted by TechNet, the  
technology industry trade group.

To varying degrees, they painted a portrait of an industry that faces  
serious challenges in an increasingly global business. In many cases,  
government policy was blamed for everything from inadequate schooling  
to a shortage of engineers to startups going overseas.

"We are falling further and further behind in innovation," said John  
Doerr, a venture capitalist for Kleiner Perkins Caufield & Byers and  
an early investor in such companies as Google, Amazon.com and Sun  
Microsystems.

The comments by many Wednesday, including Marc Benioff, chief  
executive of San Francisco's Salesforce.com, echo what technology  
executives and industry lobbying groups have been saying for years.  
But many of these past predictions about Silicon Valley's long-term  
decline have failed to materialize.

Indeed, the technology industry, particularly Internet firms such as  
Google, the Mountain View search engine, and Sunnyvale Web portal  
Yahoo, are blossoming with a slew of new products and big profits.  
Investment in startups is strong, prompting some to describe the vast  
sums of venture capital being thrown around as a new bubble.

Nevertheless, executives repeatedly said that the United States is  
losing its edge in education and called for more spending on math and  
science to ensure future innovation in technology. They also  
criticized immigration policies that make it more difficult for  
foreign students to study in American universities since the Sept. 11  
attacks and also make it harder for them to get work permits after  
graduating.

The practice, some executives said, spurs the best and the brightest  
to start companies their home countries instead of in the United  
States. It also creates a shortage of computer engineers locally.

"For skilled immigrants, we should open the door," said Reed  
Hastings, chief executive of Netflix, the online DVD-rental service  
in Los Gatos.

Some groups of American computer engineers have disputed the notion  
of a shortage of skilled workers, saying that companies simply want  
to employ immigrant workers for lower salaries.

Jerry Yang, Yahoo's co-founder, said that the business environment is  
tougher because of globalization, saying it's inevitable that more  
big technology firms will emerge in such nations as India and Russia.  
But he added that many entrepreneurs still consider the United States  
the best place to build a company because of the access to what he  
described as the best venture capital and workers.

Hastings voiced confidence in the ability of Americans to innovate,  
pointing to past successes in personal computers and the Internet.  
Over the next 50 years, he said, biotechnology will play an important  
role.

New laws passed to curb accounting chicanery after the Enron and  
Worldcom debacles are costly headaches, Hastings said. But they help  
build investor trust, giving an edge to U.S. stock markets over those  
overseas.

The TechNet event in San Jose on Wednesday was held at eBay's  
corporate headquarters, and focused on innovation. The conference  
attracted a star-studded guest list, including Cisco President and  
CEO John Chambers and former Secretary of State Colin Powell.

E-mail Verne Kopytoff at vkopytoff () sfchronicle com.

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URL: <http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2005/11/17/ 
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