Is Taiwan’s last chance at tech survival the connected home?
Posted: June 25, 2014 Filed under: Uncategorized | Tags: acer, Asus, compal, computex, foxconn, idg connect, ODM, OEM, PC manuacturing, quanta, Taiwan, taiwan technology, wistron Leave a comment
I’ve just finished another piece for IDG Connect taking apart the Taiwanese technology industry – it seemed like as good a time as any on the back of Computex 2014.
If you haven’t heard of the show it’s the second largest IT event in the world and is held every year in Taipei as it has been for 34 years.
Well, the island formerly known as Formosa has been punching well above its weight on the tech scene for decades now, thanks to lots of government investment, a booming chip industry and a steady stream of bright young engineers and designers pouring from its universities.
But as I found out, many of its major firms are facing an unprecedented set of challenges which could threaten its long term future.
Firstly the PC market is in decline – which is bad news for 4th and 5th placed global brands Acer and Asus. Whether terminal decline we still don’t know but it has certainly meant Taiwan’s major ODM/OEM firms have had to adapt to a new mobile-centric output.
The two big brands mentioned above, however, haven’t done a very convincing job so far.
“The whole shift to mobility including smartphones and tablets is the new growth curve for the whole industry,” Forrester analyst Bryan Wang told me from Computex. “What I have seen is that Taiwanese companies are losing in this space.”
Gartner’s Amy Teng was not much more optimistic.
“These manufacturers have to rely on brand vendors to consume their production outcome. This business relationship is weak because today’s PC supply chain is advanced and standardised enough to transplant from vendor to vendor easily,” she argued.
Teng added that the move from high volume, low customisation products to low volume, highly customised products is a big challenge – especially when these manufacturers are being asked to be more cost effective and quicker to market.
All is not lost, though. The country’s semiconductor firms are still well placed and there are opportunities in other areas for those ODM/OEM giants like Wistron, Foxconn, Quanta and Pegatron.
“Regarding how to overcome, or thrive in the coming decade, I do not see any opportunity in the smartphone/tablet space now. However, Taiwanese companies still stand a chance in the connected home space, which is set to evolve in the next couple of years,” said Wang.
“Home/smart gateways, set-top-boxes and smart routers – these could be the angles. At Computex here, I do see home grid, smart plugs, smart home solutions are evolving as an interesting area.”
Can Hong Kong build a ‘Silicon Harbour’? Nah, probably not
Posted: June 10, 2014 Filed under: Uncategorized | Tags: china, datacentre, datacentre hong kong, google hong kong, hong kong, hong kong start up, idg connect, shanghai, shenzhen, silicon harbour, singapore, start-ups, tokyo 1 Comment
I might be back in London now but I’m still keeping one eye on the East. My latest for IDG Connect is a piece on whether Hong Kong can really lay claim to the title “Silicon Harbour”, given its dubious track record of under-investment and the increasing strength of rival Asian cities including Tokyo, Shenzhen, Shanghai and Singapore.
Well, as always, the jury’s still out. There are a lot of good things going on in Hong Kong, as this upbeat infographic shows. It’s politically stable, safe from most natural disaster and you can use the internet freely (unlike in mainland China). It’s also well connected internet-wise and relatively cheap, as Frost & Sullivan analyst Danni Xu told me: “enterprises in Hong Kong using 100 Mbps Ethernet Point-to-Point (P2P) per month are paying only one third the price of a similar set up in Singapore”.
“However, despite these advantages/benefits, Singapore remains popular in certain cases over Hong Kong when it comes to selecting a destination to set up a data centre,” she added. “Google was a prime example of this when its plan to establish a data centre in Hong Kong did not materialise. The cost and difficulty of acquiring suitable land were cited as the key reasons for this.”
It also seems like HK’s key strengths, its value as a financial centre and proximity to China, are also its biggest drawbacks. This means Singapore and other cities are usually preferred as regional hubs while HK is the choice as a base for firms looking to expand into China. It also means investors can be reluctant to plough their money into untried or tested tech start-ups as the culture is mainly about finance and property.
Forrester analyst Clement Teo had this:
“There are some structural factors may constrain ICT development in HK e.g. its relatively small domestic market and shrinking manufacturing and industrial sector do not provide sufficient incentives to spur technological developments. Moreover, HK needs to divvy up scarce resources – like land, office space and investment funding and talent – among established economic pillars such as financial services, real estates and retail.”
The HK government this year released an ambitious Digital 21 Strategy – the latest in a long line of such policy documents from the SAR – and certainly talks a good game. But I’m still hugely sceptical whether the political will is there to help smaller tech firms – the start-ups and similar which could genuinely turn the city state into a ‘Silicon Harbour’.
phil muncaster 