Saturday, December 26, 2009

In Silicon Valley for the holidays

I've been back in Silicon Valley for the last few days; tomorrow, I head back to Chicago. Not a lot has changed since I moved a year ago. Just about everything is more expensive, from gasoline (30 cents more a gallon) to food, although I got a great deal at a local hotel. It's certainly a lot warmer here, and there's no snow; I'm returning to heavy snow and a high around 25 degrees F in Chicago.

Stanford Hospital has taken over the old Excite@Home building in Redwood City, a huge white elephant that was a symbol of the dot-bomb implosion (Excite@Home went out of business before the company could occupy its new headquarters, and the building sat empty for years.) However, new white elephants have taken its place; there are two empty office towers near Great America in Santa Clara, and other, less visible empty buildings and "see-throughs" scattered throughout the area.

It feels as though the Valley is on hold, not dead, but the pre-recession energy of the place has dissipated. There's a sense that post-dot-com crash and post-recession, the Valley won't have the vibrancy that it once had. That's not to say that there isn't still a lot of activity here--after all, Apple, Facebook, Google, HP, Intel and Nvidia are all headquartered here, as are hundreds of other high-tech and biotech companies. However, I think that we're likely to see Silicon Valley become a satellite location for many companies, rather than headquarters.

It makes sense to have a presence in Silicon Valley when it's appropriate. For example, you may need an engineering team with skills that simply aren't available anywhere else, so it would make sense to set up a development office here. However, just about every other skill set you're likely to need is available in quantity in other parts of the country and world. Companies based outside the Valley should only put operations here that justify the extremely high cost of doing business.
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