Industry Development - Little gain from capital pain

[George Bray]

At 9:16 AM +1000 18/11/98, richard@auscoms.com.au wrote:

>A starting point would be to get a _definition_ of the problem. We don't do
>enough original IT here? Yes, but then what part of the industry should
>Australia try to address? Do we want to set up silicon sweatshops making
>chips?
>Design chips for international fab? Do we want to make more hardware? Do
>we want
>to develop more software? All of the above?

I think the best opportunity for success is the application of our
knowledge to global information flows. This is software developement,
e-commerce and other virtual systems and products. We've missed the boat on
hardware and chip production. Leveraging our IT skills to build systems,
and provide operators for those systems, seems like the most scalable
option in the near term. It requires, however, cheap fast network access
and intelligent fast decisions on the arising issues.

>I also hear the repeated assertion that too much of our IT ends up being owned
>by international companies. But ... that's a fairly good imitation of silicon
>valley isn't it, that every other startup has an eye only to who's going to
>acquire them two weeks before IPO?

That seems to be the model.  From the discussions I've had with ex-pats,
they try hard to secure investment locally but give up. I'm told the
funding cycle is just easier when you have lots more capital available and
many more IPO hungry VCs. I'm not sure how much of a deterrent the capital
gains tax issue here is.

Cash is cash no matter where it comes from. The trend towards Australian IT
moving off shore is also partly caused by the people networking and
industry fraternity offered in the US. Being funded by a group that's
funded lots of like-minded projects is something that's not available here.

>While there have been plenty of vision (hate that word) statements produced,
>most of those visions get picked apart by sectional interests within the IT
>industry ... "they didn't say enough about multimedia/the
>Internet/telecommunications sytems/software development/etc!"

To be a successful vision, it would need to embody the requirements of
everyone.  I think it needs to be a "hydro scheme" or "olympic" sized
project.  The small-time visions we've seen over the years obviously aren't
exciting enough to get the country's knowledge workers working toward a
common national goal.

	George
--
George Bray
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