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Where does Silicon Valley go from here? A panel of industry experts recently met to discuss that topic at a Rensselaer alumni event, and all agreed that technology would continue to play a huge role both in the Silicon Valley and in the world at large. While opinions varied on which technologies would be most important, all agreed that while we’ve seen a lot of changes in technology over the past few years, even bigger changes lie ahead.

by Michael J. Miller ’79

In May, Rensselaer and Silicon Valley’s NVIDIA Corp. teamed up to present a panel discussion focusing on the future of high-tech industry. Panelists (most of them Rensselaer alumni) represented some of the top names in the industry. The discussion was moderated by Michael Miller ’79, editor-in-chief of PC Magazine and a leading computer industry expert.
 

The panel was hosted by Rensselaer’s Northern California alumni chapter and held at NVIDIA Corp., the Silicon Valley graphics powerhouse co-founded by Curtis Priem ’82. It included four people with unique perspectives on the future of technology and business. John Lynch ’60 is a partner of Howrey Simon Arnold & White, a Menlo Park, Calif., law firm, and is focused on patent litigation. David Schmaier ’85 is executive vice president of Siebel Systems, the well-known maker of customer relationship management software. Ed Zander ’68 was president and chief operating officer of Sun Microsystems, and had made headlines that day by announcing his plans to resign from Sun. “I need a job,” he said, provoking laughs from the panel and audience.

They were joined by Jen-Hsun Huang, a Stanford graduate who co-founded NVIDIA with Priem and is president and CEO of the graphics and chipset vendor.

Where are we headed?

Much of the focus of the conversation was on the recession that has gripped the country, and Silicon Valley in particular. Part of the issue, all of the panelists agreed, was the boom times that occurred from 1995-2000, as the Internet industry and the “dot-com” mania spread over the market.

Zander said the problem was that the Internet itself became an industry — “a cure to all problems.” The industry invented a lot of companies with poor business plans and funded them, the telecommunications sector got completely out of control, and then we got into difficult economic times with financial services that funded all of this. Then, of course, we had Sept. 11; then “Enron-itis.”

“It’s a tough time and we’ve lost a little bit of confidence in American business,” Zander said. “We have an overabundance of technology in large corporations and we have to work our way through that.”

Still, he said, the talk of a “dot-com bust” misses the point. “I think that today every man, woman, and child, certainly in the United States and across the world in many cases, is using the Internet more than they did last year, last week, last night.

“Every company I talk to is re-architecting their business processes around the ’Net.”
 
Zander expects we won’t see a return to the heydays of the Internet explosion with 40 to 50 percent growth rates, but he does expect good, steady growth to return.

But, Zander said, it’s going to take us through this year and into the early part of next year before we get the confidence back and we work through some of these inventory issues and get people to free up capital budgets. “You’ve got to look at the long term and hang in there. There’s not a CEO or CIO I talk to who isn’t really looking at the ’Net as a way to run their company and get a competitive advantage.”

Schmaier also was optimistic, saying Wall Street seems to overreact, both on the upside and on the downside.

“Before you say how long will we be in the cycle, you have to step back and ask what is the probability technology will be greater in the next 10 years,” Schmaier said. “The probability in 10 years that companies will be using software, technology, and networks to make more efficient companies and better understand their customers, their supply chains, their manufacturing is 100 percent.” He predicted four more flat quarters before “this thing turns up.”

Lynch was more pessimistic. “From my perspective, what occurred was an explosion of pseudo-technologies,” he said. He believes the proposition was that “everyone was going to be successful” and that couldn’t happen. He believes technology will intensify over the next 10 years, but that companies need to look more at markets, and not just at technology.

Huang repeated the optimistic view. “There is no question that the network, the Internet, the personal computer has dramatically enhanced our productivity,” he said.
“One can argue, though, that we’re still in the process of absorbing the enormity of technology that has been created, and the quantity of technology that has been created.”

But he agreed that technology makers have sold too much to each other and their friends, and not enough to the mainstream. Part of the issue, he said, is incrementalism in the evolution of technology. “When you look at technology on a year-to-year basis, the technology appears to be improving, but it is not dramatic. But when you look at it over 10 years, you see a technology discontinuity.”

Indeed, it seemed like everyone in the room—panelists and audience alike—believed that there was much more to come in technology.
 

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Rensselaer Magazine: September 2002
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