Cisco has been buying Internet software collaboration companies left and right for a while now. And the most important software being built today, is arguably on the Internet. Even companies that build hardware, like Apple or Cisco, create world-changing products by blending in better software. Innovation (and economic value) in Silicon Valley long ago shifted over to software. The answer, I suspect, will not be a better microchip, although we still do need those. The transistor and the integrated circuit gave rise to the last half century of prosperity. The risk is that by focusing an entire generation of bright young entrepreneurs on such silly things, we’ll fall behind in creating the fundamental building blocks of our economy. He also leaves out the entire budding industry of hundreds of greentech startups, many in Silicon Valley, which are trying to re-engineer how we produce and consume energy.īut let’s focus on his argument as it pertains to the newer crop of tech startups: the Facebooks, Twitters, and Zyngas. He also forgets that there are still tons of hardware companies in Silicon Valley designing computers, phones, tablets, communications and data storage equipment, to name a few. For instance, Lyons conveniently fails to mention Google, which is arguably tackling many of the hard engineering problems he laments are no longer being tackled. Well, there are still plenty of companies in Silicon Valley trying to solve hard engineering problems. The question on its own is still important, and should not be rejected out of hand. Let’s separate the argument from its source. But using a patent troll’s complaints about the lack of “real” innovation in Silicon Valley as your main example is flawed. For one thing, he hangs the entire thing on quotes from Nathan Myrhvold, the former Microsoft CTO who is now best known as a patent extortionist. There are so many things wrong with Lyons’ argument that I don’t know where to start. He points to Facebook, Twitter, and Zynga, “the three hottest tech companies today,” as proof that Silicon Valley is nothing more than Silly Valley. In contrast, Lyons suggests that today’s Silicon Valley companies are not tackling big enough challenges that could fundamentally alter the economy and or how people live. The magic of shrinking circuits gave rise to the computer industry, the Internet, and all of its offspring. Dan Lyons raises a provocative question in his latest Newsweek article: Is Silicon Valley still solving hard problems? After all, the “silicon” in Silicon Valley comes from its being the birthplace of the microprocessor.
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