Taiwan's tech industry is attempting to re-invent itself from being a centre of low-cost electronics manufacturing to one of innovation. Driving this effort is Johnsee Lee, president of the Industrial Technology Research Institute of Taiwan, or ITRI, which produces about three tech patents a day and spins out five or six tech companies a year.
Q. Taiwan is known for its IT and OEM manufacturing, but I understand things are changing. What higher-end tech products are now coming out of the country?
A. There are many different areas, but one is WiMax. We have a large team working on this new so-called mobile Internet system. Not just networking but also handsets, chipsets, software, applications and services. So it is a new opportunity and we are working on mobile WiMax system with MIMO, multiple input and multiple output technology. Another area is flexible electronics. We have spent a lot of effort working on flexible displays, flexible electronics for many different applications, including signage and solar panels.
Q. Does Taiwan have a competitive advantage in WiMax?
A. We have a very good foundation in WiFi because we provide a large number of WiFi technologies and also the manufacturing and supply of WiFi products.
And that is the base we can work from.
Also Taiwan's involvement under government sponsorship has evolved with many different infrastructures, such as Taipei. It is one of the largest wireless cities, with 4200 access points to broadband systems and those kinds of environments can facilitate the development of new technologies, devices and applications.
Taipei has about 2,5 million people and 95% of the population can be covered by WiFi. That is just one example.
Q. How many WiMax deployments are there currently in Taiwan?
A. They are mostly still in the experimental stage. We have worked on a large number of applications and systems. Also we are using WiFi in high-speed railroad and bus systems, and we will try the use of WiMax for the last mile of these systems.
Q. As part of the quest to be more of a knowledge-based economy, are Taiwanese companies investing more in enterprise IT?
A. Yes. As of today, statistics show our government and schools are 100% online. And business is 87% online, while homes are about 70%. Our broadband subscriber base is about 5 million, which is almost equal to the number of households in Taiwan. So I think, generally speaking, Taiwan is getting online very quickly. And for companies, they are moving even faster to invest in enterprise IT.
Q. What types of enterprise IT?
A. That covers a lot of different areas. First of all, Taiwan has a program called e-Taiwan, and we are now into the second phase called m-Taiwan, which stands for mobile Taiwan. It is a big program sponsored by the government, encouraging not only the building of mobile infrastructure but a lot of programs to encourage companies. If you have any proposal for developing new applications, new systems or the installation of new systems in a variety of enterprise applications they will give you a development grant. And it is a partial financial support for installation, to try out some of the newer systems.
Q. Does Taiwan have a local 'Silicon Valley'?
A. Yes. Most of the high tech industry was developed around my organisation ITRI. As you know, there are companies such as TSMC [Taiwan Semiconductor Manufacturing] and UMC [United Microelectronics], they are all spun off from ITRI. ITRI is in Hsinchu, which is about 50 miles south of Taipei, the northern part of Taiwan. It has ITRI and two universities but also a very big industrial park. That is where Acer, TSMC and other high-tech companies are located.
Q. What large US or European enterprise IT companies are investing in Taiwan and why?
A. There are many. For example, IBM has big operations, Motorola. Just using WiMax as an example, Intel, Nortel, Alcatel and NEC all just signed a collaborative agreement a few months ago to join the endeavor in WiMax. And there are many of the display companies.
Q. The protection of intellectual property rights, and the ability to enforce that protection, can be problematic in some countries. How would you describe the situation in Taiwan?
A. Taiwan is, relatively speaking, very good in that respect because, as just one example, we receive about 5000 US patents every year. We are No 4, according to the US Patent and Trademark Office, only after US, Japan and Germany, in terms of the number of US patents granted to the organisations and companies in different countries. And it has been like that for last five years. And, therefore, we have changed from a country that used a lot of patents from others into a country that owns a large number of patents.
Also, just recently, Taiwan set up an IP designated court to deal only with IP issues. All this shows there is much increased attention to protect IP.
In fact, that is a big differentiation between Taiwan and China. China has a problem in protecting and respecting IP, while the reason why many companies like to do R&D; work in Taiwan is because there is better protection of IP.
Q. What is the country's biggest obstacle to becoming a player on the enterprise IT stage?
A. International partners are very important, and that gets into the marketing and distribution of enterprise IT products. Because most of these products are more sophisticated than consumer IT and require even more technology, I think be able to partner with international players will be very important.
Johnsee Lee received his advanced management program degree from Harvard, following an MBA at the University of Chicago and a Ph.D from the Illinois Institute of Technology. Prior to joining ITRI, he was president of the Asia Pacific Industrial Analysis Association and the Bio Industry Organizations in Taiwan. He has worked at ITRI in various capacities since 1990. Among his numerous professional posts are project leader Johnson Matthey in New Jersey and principal investigator at the Argonne National Laboratory in Illinois.