1. Information Technology (IT) Industries in the S4-5 Geography Curriculum Dr. Becky P.Y. Loo Associate Professor Department of Geography, HKU

2. Information Technology (IT) Industries in the S4-5 Geography Curriculum What? Where? Why? How? Conclusion

3. What? Generate, process and exchange information What is information technology? Desktop computer? MP3? Mobile phone? Telephone line? Electronic dairy? E-mail account? Radio?

4. Oral face-to-face contact Simple pictorial presentation Late 19thC and early 20thC Mechanical, electromechanical Early electronic technologies Computer + Old IT Printing : After the 1950s Microelectronic technologies Written language e.g. typewriter, camera, telephone, telegraph e.g. computers, robots, fibre optics Telecommunications New IT Convergent IT generate & process exchange e.g. paper, ink, printing press

5. What are information technology industries? Information technology sector (Norton, 1999) Large computers Personal computers Software Semiconductors Semiconductor equipment Communications Medical technology (biotechnology & instruments) Standard Industrial Classification (SIC) (1972) (Varga, 1999) Information technology 357 Office computing and accounting machines 361, 3825 Electrical transmission and distribution equipment 365 Radio and television receiving equipment, except communication types 366, 367 Electronic components and accessories, communication equipment

6. Where? Global level National level Sub-national level N. America? Africa? Europe?Asia? USA? Mexico? Germany? Yugoslavia? Japan? Burma? Silicon Valley? Hollywood? Munich? Berlin? Tokyo? Sendai?    IT industries are highly localized at different spatial scales.    

7. 3,400 square km Flanked by the Coastal Range Valley: 1/3 of the total area Spanish colonizers in the late 1700s Agrarian economy San Francisco Bay Santa Clara county Case study: The silicon valley

8. 1930s Prof. Frederick Terman, Electrical Engineering, Stanford University Setting up commercial enterprises with professional knowledge 1940s No. 15 most productive agricultural counties in US 1/3 of California’s annual crop of plums, cherries, pears & apricots Stanford Research Institute 1950s WWII and the outbreak of Korean War Federal funds for electronics research and development War-related aerospace and electronics enterprises Stanford Industrial Park, Stanford Research Park 1950-1954:  Military prime contracts to California $13 billion  14% of US total

9. 1970s 1960s Department of Defense’s electronics-based programs Throughout the entire Cold War period Large supply of scientific and engineering manpower Distinguishing characteristics at early stages: Over 40,000 new jobs a year “Right place to be” 1 new jobs2-3 new jobs in other sectors Federal defense and aerospace contracts as huge markets Easy access to venture capital in San Francisco Multiplier effect 1980s Population: 1.25 million World’s most intensive complex of high-tech activity

10. Electronics Employment Hi-tech in total employment of the Silicon Valley: 1959 1965 1970 1975 1980 1985 9.7% 20.9% 39.5% 55.7% 69.8% 78.9% Computers, other office machines, communications, semiconductors, other electronic components, missiles/parts, instruments, drugs, software/data processing, IC labs, electronic wholesale, computer wholesale

11. Open Windows of Locational Opportunities 1.Discontinuity nature 2.Innovative milieu … ability to create favourable production environment. 3.Chance … importance of generic, as opposed to specific factors of production Away from old centres Lack of favourable factors not important Widely range of suitable areas Why?

12. Three reasons for localized knowledge 1.Nature of the innovation process a)Incremental reduction of technical and economic uncertainty Technical feasibility Market acceptability creation and accumulation Formal and informal networks for knowledge exchange Trial and error approach Innovative milieu

13. Web of relationship Material elements c)Face-to-face contacts in the exchange and creation of new knowledge Informal channels Tacit knowledge Direct observation of products and production process b)Continual interaction between related firms Joint development work Sensitive information Immaterial elements Institutional elements

14. 2. Barriers to spatial diffusion Geographical inertia Limited mobility of physical, human & social capital SpeedCostsLed time

15. 3.Tapping Outside resources People Firms Capital Ideas Technology Patents By outsiders “Right place to be” By incumbents Role of TNCs

16. 1.Nature of the innovation process Case study: Silicon Valley 1930s-1940s Not particularly strong Stanford University Other Universities: e.g. MIT in engineering Other commercial clusters: e.g. laboratories of IBM, Bell … 1960s Stanford UniversityStanford University laboratories recruiting nationallyLocal laboratories recruiting nationally SRI, NASA’s Ames Research Center, IBM, ITT, … interactionsUnusually high degree of interactions PhD degree Part-time honours programmes Important to small firms and young semiconductor industry Industry-university research sharing and seminars

17. 2.Barriers to spatial diffusion Supplies of specialized inputs and services Physical capitalPhysical capital Photomasks, testing jigs, chemicals, silicon and special production equipment Human & social capitalHuman & social capital lifestyleHighly desirable lifestyle (creation of social & cultural milieu) Social statusSocial status Switch jobsSwitch jobs without relocating Recreational opportunities Suburb lifestyle Horse owners

18. 3.Tapping Young scientists Young scientists from all over the country peopleOutside people jobsTo land jobs firmsTo start their own firms

19. Local industry liberally financed with venture capital technologyOutside technology firmsNew firms capitalInflow of capital Success of Fairchild

20. Financial supportFinancial support from San Francisco A large pool of wealthy individuals and families with discretionary incomes ManagementManagement consulting house

21. How? “ Post-Fordism” Specialized production Flexibly deployed (increasingly non-union) labour Flexible machines External economies of scale Agglomeration economies Spatial division of labourSpatial division of labour Vertical disintegration within each product groupVertical disintegration within each product group Flexible production

22. Less-developed countriesDeveloped countries Less-developed countriesDeveloped countries Transformation within the capitalist economy Labour-intensive industriesCapital-intensive industries Low-technology components/process High-technology components/process

23. Stages 1 – 3 Stages 4 – 6 1. Different stages do not need to be in geographical proximity High-level scientific, technical & engineering personnel Low-skill labour, female Pure production environment Suitable utilities Pure water supply Waste disposal facilities Clean environment

24. 3. Differential impacts of technological change on different stages Which stage is the most profoundly affected? Increasingly capital- & research- intensive Which stage is the most mobile? Stage 5 -- Assembly & packaging Stage 3 – Wafer fabrication How much money is required? New lithographic techniques Automation 2.Low weight-high-value characteristics Low-labour cost areas

25. Rise of the “fabless” semiconductor firms 1960s Early 1970s Early 1980s Late 1980s 1996 Roughly 2 millions USA in 1980s Design house, product design and development Raw wafer manufacturing 15 – 20 millions 50 – 75 millions 150 millions 1 billion to 2 billions Quality assurance, marketing, sales, customer support, testing And wafer fabrication subcontracted to outside firms Chip assembly 1 46 235 In-house Contract out

26. Conclusion One of the many approaches Industrial geography is always changing Some major trends and characteristics Information sharing vs teaching kit guides