Renewable Energy on the March

A reader flipped me a review of Taiwan's renewable energy policies and industries, looking at solar, wind, and ocean:

If Taiwan's PV success is likely to stay centred around exports, it has significant ambitions for its most obvious natural asset – the oceans that surround it and the winds that blow there.

Offshore wind power is central to Taiwan's renewable energy project, says a spokeswoman for the Industrial Technology Research Institute (ITRI), the Taiwanese government's technical arm. 'Renewable energy in Taiwan for the most part will be offshore wind power,' she adds.

The nation's industrial sector announced its offshore ambitions at the end of 2010 with the formation of the Taiwan Offshore Wind Power Alliance – made up of 18 companies from the region's energy, engineering and manufacturing sectors – and plans to set up Taiwan's first offshore wind farm in Changhua County, according to local reports. Commercial operations are due to begin in the second quarter of 2013 with its first two 5 MW turbines. If all goes to plan, these will be joined by a further 122 machines by the end of 2016.

Late 2010 also saw the Taiwanese government unveil its own plans for an 8 MW offshore wind demonstration project off the Penghu Islands, to be operational by the end of 2012. Penghu – a cluster of 90 small islands off the western coast of the Taiwanese mainland – is set to become something of a showcase for the country's renewable and low carbon credentials.

The government has pledged support to turn Penghu into Taiwan's first low-emission county by 2015. Plans include 96 MW of onshore wind capacity, solar energy initiatives and the creation of recharging infrastructure for electric mobility. According to Taiwan's Council for Economic Planning and Development, this should enable 56% of Penghu's energy needs to be met from renewable sources by the end of the five-year programme.

Penghu will also play a major role in Taiwan's efforts to harness ocean energy, a high priority technology for the government and ITRI. The national target is for a 200 MW installed capacity by 2025.

With around 1500 km of coastline and a sub-tropical environment, Taiwan has been investigating two main strands of ocean energy development since 2005, when its National Energy Conference formally decreed it a priority.

One is Ocean Thermal Energy Conversion (OTEC), in which the country is at the forefront of global research thanks to ITRI's collaboration with Lockheed Martin of the US. The second focus of Taiwan's ocean push is to unlock the considerable potential of the waves and tidal currents around its shores. According to ITRI, studies have shown that the north-east offshore region of Taiwan has a wave energy potential of several hundred megawatts, while the east coast's Kuroshio path and the Pescadores Channel (off Penghu) have tidal current energy that could theoretically be tapped at gigawatt scale.

Ocean Thermal Energy Conversion is described in this Youtube video. Unlike fossil fuels which are environmental poisons, OTEC can have an interesting by-product if you live on a tropical island: fresh water. Wiki notes:

OTEC can also supply quantities of cold water as a by-product . This can be used for air conditioning and refrigeration and the fertile deep ocean water can feed biological technologies. Another by-product is fresh water distilled from the sea.

The article also discusses the state of Taiwan's PV tech producers relative to the market -- the old Taiwan story of being good at producing stuff but not at the service side -- installing, distributing, etc. Between them Taiwan and China control around 60% of the global PV market.

There's a map of Taiwan's wind machines but it locates some things in the wrong places, like the four windmills on Datun 12th Street in Taichung city. Oops.

This paper in Renewable Energy discusses the island's wind power potential. At present about 40% of Taiwan's energy comes from coal, a policy that is insane from both an environmental and energy security policy standpoint.
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Daily Links

• Chinese rag runs article about KMT legislators complaining about Americans getting biased reporting from the Taipei Times.
• DPP working on cross-strait policies for election and beyond. Can we please stop writing "remarks certain to rankle Beijing." Let Beijing speak for itself; it has Xinhua for that. Quit playing to the propaganda that the DPP provokes Beijing.
  
• Banyan at the Economist visits the renovated 2-28 Museum. So far everyone says it's been toned down but not totally whitewashed. Poagao said that much of the old art has been retained. The key thing has been the removal of documents that connect Chiang Kai-shek to the massacre. BTW, Banyan, the original sin of the KMT is being an authoritarian, colonialist party. Everything else, including 2-28, flows from that.
  
• China Reform Monitor notes (Russia has a Jewish Autonomous Region??):

  Russia’s Nezavisimaya Gazeta reports that China is “investing far greater funds in Russia's Far East than the Russian Government” and called the imbalance “Beijing’s clear state policy to assimilate new territories.” The newspaper cites an official Xinhua press report on investment in the Russian Far East claiming that Chinese investors have established 34 special Chinese economic zones in Russia’s Amur Oblast, Maritime Kray, Khabarovsk Kray, and the Jewish Autonomous Region, where they have invested a total of $3 billion mostly in resource extraction. Chinese entrepreneurs also hope to open industrial and agricultural zones in Russia, including processing zones, stock raising, construction, timber cutting, and wholesale markets. To oversee the construction and development of China’s industrial and agricultural zones in Russia, the Heilongjiang provincial administration has created a special leading group. The Russian paper reported that in 2011, Moscow’s total transfers to these regions' – $170 million for Amur Oblast, $74 million for the Jewish Autonomous Region, $234 million for Khabarovsk Kray, and $344 million for Maritime Kray – are under one third China’s investment.

• Blacked Out Korea -- yes, a site dedicated to photos of Koreans blacked out from being blind drunk in public places.
  

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[Taiwan] Don't miss the comments below! And check out my blog and its sidebars for events, links to previous posts and picture posts, and scores of links to other Taiwan blogs and forums! Delenda est, baby.

Hejian/UMC deal blocked by FSC

Some very interesting news caught by the blog column of Robin Kwong at the Financial Times: Taiwan's Financial Supervisory Commission (FSC) has blocked a deal between a Chinese and Taiwan firm.....

UMC wanted to take full ownership of He Jian, a Chinese chipmaker that it helped set up years ago in a controversial move, which resulted in UMC being fined T$5m (US$155,000) for illegal investments in China. UMC has a 15-per-cent stake in He Jian, but wanted to buy the remaining 85 per cent as well.

UMC said on Thursday that its board has decided to terminate the merger agreement with He Jian because it could not clear Taiwanese financial regulatory hurdles. Under the agreement, UMC would have paid for the deal by granting He Jian’s owners shares and share options as well as cash.

“However, an investment regulation governing foreign holdings of Taiwanese securities, coupled with other restrictions…precluded the issuance of common shares or ADR [American Depository Receipts] as payment options,” UMC said in a statement.

UMC said He Jian’s shareholders had not yet decided on whether they would accept an all-cash offer, and UMC would “continue seeking possible alternatives with He Jian shareholders” for an acquisition.

UMC is the world's second largest contract chipmaker. Its announcement that the merger is terminated but alternatives will be explored is here.

Some of the tale of UMC's relationship HeJian is told in older news stories about the transfer of technology out of Taiwan into the Chinese firm. For example:

The allegations made against [UMC Chairman Robert] Tsao, [UMC Veep] Hsuan and co. centre on claims they invested in Hejian. The Chinese foundry was founded by a number of ex-UMC executives in 2001. Tsao maintains he simply advised the founders on business matters, and UMC says it has entered into no deal with Hejian, either to provide it with funding or technology. In Taiwan it is unlawful to invest in any Chinese technology-related company without first winning the approval of the Taiwanese Government.

However, it has been claimed that Hejian staffers not only had access to UMC's intranet, but the company's fab incorporated UMC-patented technology, seemingly without protest from the Taiwanese company. It's alleged UMC tacitly licensed its technology to Hejian.

Investigators from Taiwan's Ministry of Justice raided UMC's HQ and the homes of executives in February seeking evidence to support these allegations.

UMC has said it would like to invest in Hejian, and in March 2005 put in place a scheme to put $110m into the company via the correct channels. Tsao had already said that UMC would be keen to acquire Hejian at some future time.

The UMC-Hejian case has yet to come to court, though Tsao and 23 other executives, including Hsuan and Hejian chairman J. H. Hsu, were last year named as defendants when the case is eventually heard by Taiwan's Hsinchu District Court.

FT's bizarre complaint that this represents "excessive caution" notwithstanding (because everyone knows that Chinese mean only love and sincere friendship for Taiwan, and never use connections to steal outside technology from foreign firms), this move by the FSC is an interesting wrinkle. The financial and trade agreements between the KMT administration and its CCP ally are designed to integrate Taiwan into China's economy so firmly that Taiwan cannot be extricated.

Recall that the FSC blocked the deal for AIG's Nanshan Unit a few months ago because of the iffy nature of the Chinese buyer. The question is -- is this solely a decision unique to this case (perhaps to punish UMC for helping to start HeJian in the first place?). Or is this a subtle policy designed to prevent deeper integration of Taiwan's financial industry with China by determining, on a case by case basis, that such investments are unsuitable?

Only time will tell.
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[Taiwan] Don't miss the comments below! And check out my blog and its sidebars for events, links to previous posts and picture posts, and scores of links to other Taiwan blogs and forums! Delenda est, baby.

Economic Round-up

At last the sigh of recession: the land
Wells from the water, the beasts depart, the man
Whose shocked speech must conjure a landscape
As of some country where the dead years keep
A circle of silence, a drying vista of ruin,
Musters himself, rises, and stumbling after
The dwindling beasts, under the all-colored
Paper rainbow, whose arc he sees as promise...
-- WS Merwin

Ma save us! The Recession Monster cometh, as the newspapers were all reporting yesterday:

The Directorate-General of Budget, Accounting and Statistics (DGBAS) said that GDP shrank 1.02 percent in the third quarter from a year ago and could contract another 1.73 percent in the fourth quarter, dragging down this year's full-year growth rate to 1.87 percent, from the 4.3 percent it estimated in August.

As the economic contraction is expected to persist into the first quarter of next year, the DGBAS slashed its GDP growth forecast for next year by more than half to 2.12 percent from the 5.08 percent it predicted in August in the face of slumping exports and tight consumer spending.

Party time is over: in 2006, 2007, and 2008 economic growth rates accelerated, and in just six months since Ma has been elected, growth rates have plummeted to a seven year low. Great work by my two favorite Administrations, those of Ma and Bush. Reality has also hit Ma's promises on Chinese tourists and on income:

The voucher plan is forecast to lift the economy by 0.64 percentage points next year, while Chinese tourists are expected to contribute an extra 0.5 percentage points.

The DGBAS put the number of Chinese tourists visiting Taiwan at 3,000 a day next year — although the number averaged 273 in the third quarter and is expected to rise to 500 in the last quarter.

Annual per capita income is estimated at US$18,020 this year and to fall to US$17,651 next year, the report said.

Remember, during the election one of Ma's promises was to raise per capita income to US$30,000 annually. Then it became $30,000 annually....in eight years. At present, Ma would have to double incomes in seven years to do that. Even if we have 7% growth for the next seven years, and the population doesn't grow, we won't be able to do that.

Further observe that they are still in Cargo Cult mode -- Chinese tourists will flood in to save the economy! With Japan, an important source of tourists for Taiwan, moving into recession, Chinese tourism may become more important. Too bad things are not looking up in China either. Maybe we'll reach a thousand tourists a day....

The driver of growth here for the last few years has been tech exports. Sure enough, "Taiwan's tech sector in peril", says the NYTimes in the International Herald Tribune.

The souring world economy has spotlighted the weaknesses in Taiwan's semiconductor and flat-panel screen industries, which trail rivals from South Korea and Japan in technology, customer base, scale and currency valuation. The shortfall has become particularly evident during the recent supply glut and, now, a decline in orders from the United States and Europe.

Some Taiwanese technology companies remain in good shape to ride out the downturn. Taiwan Semiconductor Manufacturing Co. , or TSMC, retains a leading edge in chip-making technology, for example, and contract electronics giants like Hon Hai are somewhat insulated by their big economies of scale.

But the smaller players in lower-margin businesses are vulnerable, analysts say, companies like the memory-chip maker ProMOS and the flat-panel makers Chi Mei Optoelectronics and Chunghwa Picture Tubes.

For now, the gravest concern is focused on memory-chip makers. Taiwanese firms account for 40 percent of worldwide production of latest-generation dynamic random-access memory, or DRAM, chips, compared with 30 percent to 35 percent for South Korean companies, according to the market researcher DRAMeXchange, based in Taiwan.

What's the problem with the memory chip makers?

Memory-chip companies are at a disadvantage in technology, analysts say, because they lease technology from South Korean and Japanese manufacturers and in exchange provide those foreign companies with DRAM chips at below-market cost. That saves research and development and other costs in good times. But it is a punishing pricing arrangement in bad times, when memory chips are selling on the open market at below the cost of production.

"If you don't have technology, you can't drive down costs," said Joyce Yang, an analyst at DRAMeXchange.

The article gives a good look at Taiwan and some of the policy choices the government faces.

Speaking of policy, the government gave out the latest set of restrictions on the voucher plan.

Also forbidden is the use of vouchers to purchase non-business services. For instance, patients can’t use vouchers to see doctors.

“Moreover,” Chen Tain-jy, chairman of Council of Economic Planning and Development (CEPD) told the press, “nobody is allowed to buy or sell vouchers.” In other words, collection of vouchers to purchase an expensive item, such as a car, is prohibited.

Otherwise, all nationals of Taiwan, old and young, can pay for anything anywhere with their vouchers, like cash.

Even vendors are allowed to accept vouchers. You can buy a bowl of beef noodles from one of them and pay for it with one of your vouchers.

But, Chen said, licensed vendors alone can accept vouchers. All they have to do is to reuse them somewhere else where what is known as a unified invoice is issued as receipt.

Unlicensed vendors, though not officially allowed, can accept them and reuse them just like their licensed counterparts.

“You can stay in a hotel or visit a karaoke bar and pay with vouchers,” Chen said. “Of course, you can even buy gold as an investment.”

One can also purchase caregiver services; the caregiver can reuse the voucher.

Vouchers will be available in a book of nine, according to the CEPD. There will be six NT$500 vouchers and three NT$200 vouchers in a book.

"...gold as an investment." Taoyuan Nights sent me an amused email yesterday: isn't buying investments a saving? And thus, entirely contrary to what the voucher is supposed to be doing?

[Taiwan]

Hi-tech Taiwan: Upgrading and Innovation

A couple of interesting pieces out this week on the problems Taiwan is facing in the global economy. First Businessweek has an article discussing the problems Taiwanese makers in branding and innovation...

"If you look at the semiconductor industry in Taiwan, it is very competitive globally with a gross margin of between 30% and 50%," says Peter Tsao, vice chairman of Deutsche Bank's global technology group. Taiwanese semiconductor design is so effective, he says, that it has allowed Taiwan to take away market share from the US, reversing the direction of business migration: whereas US companies would set up their manufacturing centres in Taiwan, it is now the case that Taiwanese semiconductor companies are establishing their own design centres in Silicon Valley.

The situation is tougher when it comes to electronics assembly, or original equipment manufacturing (OEM), which comes with a gross margin of only around 10% – the vast majority of the value-added going to the owner of the finished-branded product, rather than to the manufacturer.

Companies that operate in this area – such as mobile phone manufacturer Foxconn – have not only faced a slowdown in demand, but also a less favourable environment in their main manufacturing base, China. Wages have crept up thanks to a new labour law and tax concessions have been removed, putting Taiwanese companies on a more level playing field with their Chinese competitors.

One thing that makes Taiwan stick out from its technological neighbours is the lack of big brands – Japan has Sony, Korea has Samsung and China has Lenovo. Taiwan does however have some companies that have gone beyond assembly to target the consumer directly.

Computer-maker Asustek Computers has recently gained some success with its Eee PC, a scaled-down notebook computer that was popular in the US last Christmas. Acer has been focusing on developing its own brand. But even though it is one of the world's biggest notebook companies, it is not obvious how much of that is due to the brand rather than the company's low prices.

"Acer is one of the only Taiwanese brands that has been recognised. But does it have brand equity? Are you willing to pay more for an Acer than for another computer? No!" says one Taiwanese tech specialist.

The article is quite interesting, and one expert cited opines that the best route to take is for Taiwanese firms to be bought up by Chinese firms interested in globalizing themselves.

Meanwhile the always excellent Jon Adams writes on Taiwan's manufacturers as they fight falling exports (Ma save us!) with small PCS:

An upstart Taiwanese company blazed the trail. Now, the world's top three computer makers are hot on its heels. The prize: dominance of the emerging market for low-end, mini-laptop computers.

The big three — the American companies Hewlett-Packard and Dell, and Acer of Taiwan — are betting that such products will have broad appeal. They are offering these laptops, also known as netbooks, in the developing world as an affordable alternative to desktops and high-price laptops, and advertising them in the United States and other advanced markets as a second or third computer used mostly with the Internet.

And in belt-tightening times like now, they are hoping consumers in mature markets will also snatch them up as a more affordable option.

"It's a potentially exciting area, particularly when people worry about the U.S. economic outlook, in which people might want to cut spending," said Steven Tseng, an analyst at ABN AMRO in Taipei. "So it fits into the macro trends quite well."

There is no clear-cut definition for the segment, and analysts say the lines get blurry. But most of the new crop of minicomputers have screens that are less than 10 inches, or 25 centimeters, across diagonally and priced from about $300 to $600, but still have full operating systems like Windows XP or Linux that can support third-party applications.

The new market reflects a broad shift toward mobile devices and away from desktop computers, and changing tastes in mature markets like the United States and Europe, analysts say.

"Three or four years ago, this kind of product couldn't have had such a big success, because people were still purchasing their first laptop," said Eszter Morvay, a researcher at the technology consulting company IDC in London. "Now, their needs are becoming more sophisticated — the consumer has evolved. They might just need an Internet device, or a second or third laptop for work, or for mom or the kids. So this is giving a boost to the market."

Until recently, the big computer makers paid scant attention to this niche. They had built mini-laptops — like Toshiba's Libretto — but they were either too expensive (the Libretto costs about $2,000) or poorly designed to catch on in the mass market.

Then, about a year ago, Asustek, a Taiwanese computer maker little known outside the country, introduced the Eee PC. Priced under $300, the first version featured a seven-inch screen and used the Linux operating system. The idea was simple: Consumers are increasingly using laptops for surfing the web, checking e-mail messages and viewing photographs, and do not need all the bells and whistles of a full-blown computer. The Eee PC was also an attempt to offer a commercial version of the XO laptop, the product of the nonprofit One Laptop Per Child project, which aims to distribute computers in the developing world.

The Eee PC was a surprise success. Last year, it hit the top of the "most wished for" laptop list on Amazon.com. That got the industry's attention. Now, the three leading computer makers have released mini-laptops.

Actually, Taiwan's firms are very innovative in technology, but the problem is that many of the small and medium sized firms that drive Taiwan's economy lack similar innovativeness in financing, management, and administrative practices. Though I hear they are quite clever in the accounting department....

[Taiwan]

Economic Tips and Tricks

My friend Jim passed me this article from an online Japanese paper on Taiwanese and Chinese firms registering Japanese names as trademarks.

Chinese and Taiwanese firms also have submitted applications to Chinese authorities to use Japanese regional brands including Matsusaka-ushi beef and Naruto Kintoki sweet potato as trademarks, a JETRO official said.

The Japanese local specialties have been designated by the government's Patent Office as regional brands to stimulate local economies.

Once a name is registered as a trademark, one cannot newly register the same designation unless the original trademark holder officially surrenders ownership of the brand name.

An official of the Beijing JETRO office warned that Japanese regional brands should urgently check into whether they should lodge protests with Chinese authorities to protect their trademarks that Chinese or Taiwanese firms have already registered or are planning to register.

Last month, the Kagoshima prefectural government filed a complaint with Chinese authorities against a Chinese firm that had registered the name Kagoshima as its trademark.

According to the Beijing JETRO official, as of the end of December, Chinese or Taiwanese firms had registered 36 of Japan's 47 prefectural names as trademarks, with the name Kyoto seeing the greatest number of registrations at 93.

Most companies using Japanese brands are Chinese firms, although individuals also did so.

By using Japanese brands as trademarks, Chinese firms can benefit free of charge from name recognition to raise their products' prices when marketing them in China.

Anyone out there remember back in the day, when Japanese firms used unscrupulous patent strategies to attack US firms.... Got no sympathy for the Japanese....

Speaking of East Asian economies, last week the Taiwan CEPD prepared a report on Taiwan's economic achievements under the two Chen Administrations (online in PDF, Chinese). The report notes that while South Korea average better economic growth over the entire period, 2000-08, from 2004-07 Taiwan beat South Korea in economic growth. Just another example of how much more successful we'd be if could only imitate South Korea..... the Taipei Times also pointed out another aspect of the report:

Wu said overall expenditure on research and development-related sectors went up from 1.98 percent in 1999 to 2.58 percent in 2006.

“Although the government increased budgets earmarked for technology development each year, the growth rate was limited by the legislature. The proposed budget was cut by 8.7 percent in 2005 and another 7.9 percent in 2006,” Wu told a press conference following the meeting.

As I've repeatedly noted, the KMT dominated legislature screwed Taiwan and put the onus on Chen Shui-bian. Here is yet another example....

[Taiwan]

Nanotechnology Development in Taiwan

One aspect of economy policy under the DPP is its forward looking technological aspects, whereas Ma's economic proposals, under Siew, are based on a back-to-the-future 1970s model that involves spraying concrete around Taiwan like so much fake snow at a Christmas party. A key emerging industry in world technology markets is nanotechnology, the science of "understanding and control of matter at dimensions of roughly 1 to 100 nanometers (a billionth of a meter; a sheet of paper is 100,000 nm)," and Taiwan has pursued it with vigor:

The government is planning to appropriate NT$23 billion (US$726 million) to fund the second stage of the "Taiwan National Science and Technology Program for Nanoscience and Nanotechnology" slated for 2009-2014, officials at the cabinet-level National Science Council (NSC) said Tuesday.

The first stage, which began in 2003 with NT$17.8 billion in funding, will conclude by the end of this year, officials told reporters.

In the first phase, more than 4,000 science research papers have been generated to date, dozens of top-notch research teams were initiated, and ties between industry, university, and research institutions have been strengthened, they said.

Program Director Wu Maw-kuen, who is also the director of the Institute of Physics under Taiwan's top research institute Academia Sinica, said the program office is now working on the outlines of the next phase by determining which items of research are worth further financial support.

Wu said the focus of the next stage will be nano-electronic and optoelectronic technology, nano-scale instruments, nanotechnology for energy and environmental applications, nano-scale biomedical research, and the various technologies' utilization in potential and traditional industries.

How does this sum compare? It is about half the US$1.444 billion the US Nanotechnology Initiative is spreading across 13 US government departments for nanotech research, though Taiwan's GDP is just a fraction of US GDP. Additionally, the Taichung Science Park was originally intended to be nanotech oriented.

The article also alludes to a key function and metric of Taiwan's universities: producing papers for foreign consumption. Pressure to publish in Taiwan universities is excruciating -- and not merely to publish, but to publish in top journals (the importance of chasing status in Chinese cultural is instrumental in this push). At NCKU where I am doing a PHD in international business, my fellow students generally try and place papers in just the top 2 or 3 journals. One can only imagine what will happen when the coming wave from China breaks over the world of academic journals.

One perennial problem in Taiwan's development is the university- government-industry triumvirate: the first leg is only weakly linked to the second and third. The government has been working on integrating the universities more into national industrial development. Part of the problem is that the technocracy responsible for the major input into government economic and technology policy formation is not university-based, but rather holds court in the think tanks in Taipei, according to a knowledgeable person I spoke to a couple of months ago, and it sees the universities as places for producing papers Taiwan can use to validate itself on the world stage (hence the government's proud announcement that its nanotech initiative had generated 4,000 papers). Another problem is the rigid execution so common in Taiwan's public policy -- all departments are ordered to have "industry-university cooperation" and so, by god, they shall. At one university I taught at "industry-university cooperation" in my department consisted of a proposal to teach English at a local airline. The private for-profit universities often frankly see such programs as merely another profit center.

Still other problems are the lack of high-quality universities -- the so-called "universities of technology" are largely voc-ed finishing schools that generally do not have access to high quality students, especially innovative grad students, so necessary for technology development programs. The testing system tends to shunt such students into the national universities, and when profs hit the big-time, they tend to move to one of the national schools as well. The Ministry of Education is often roundly criticized by the locals, but making modernity more than just a mask in the local universities is a daunting task.

[Taiwan]

Nature on Nanotech and Gene Tech in Taiwan

Naturejobs.com offers an interesting look at Taiwan's high-tech dreams and their implications for the island's employment and technology situation:

Such aspirations are grounded in reality, because many of the country's senior faculty members and administrators trained and worked in top institutions in the United States and Europe. Some come back, mid-career, to care for ageing parents, and take a pay cut in doing so (see 'Low-tech, high-tech'). But schemes to address repatriates' salary issues are gathering steam as part of a bid to internationalize its workforce and to build better facilities in targeted areas.

One of the largest drivers toward Taiwan's goals, the Industrial Technology Research Institute (ITRI), is steering that change. ITRI boasts about 6,000 researchers, of whom roughly 950 hold PhDs. "We've created about 130 companies in the past 30 years," says ITRI's president, Johnsee Lee. But he acknowledges that many of those companies have focused on contract manufacturing, licensing out technology and outsourcing. The biggest example of this phenomenon is also one of ITRI's most prominent success stories. The Taiwan Semiconductor Company, spun off from ITRI 20 years ago, makes chips for most of the world's laptop computers, and sells them under many labels, including IBM. "We have to change from being a follower to being a differentiator, by combining technology and industrial design," says Lee.

It's a long article and there is plenty there.

[Taiwan]