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Econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Norton, R.D. Conference Paper Where are the world's top 100 I.T. firms - and why? 38th Congress of the European Regional Science Association: "Europe Quo Vadis? - Regional Questions at the Turn of the Century", 28 August - 1 September 1998, Vienna, Austria Provided in Cooperation with: European Regional Science Association (ERSA) Suggested Citation: Norton, R.D. (1998) : Where are the world's top 100 I.T. firms - and why?, 38th Congress of the European Regional Science Association: "Europe Quo Vadis? - Regional Questions at the Turn of the Century", 28 August - 1 September 1998, Vienna, Austria, European Regional Science Association (ERSA), Louvain-la-Neuve This Version is available at: http://hdl.handle.net/10419/113603 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu WHERE ARE THE WORLD'S TOP 100 I.T. FIRMS--AND WHY? R. D. Norton Bryant College June 1998 (Preliminary draft. Not for quotation.) Like the Internet after 1994, the personal computer or PC started a new era in the evolution of information technology (IT). In 1981, prompted by the success of the Apple II, IBM introduced its PC and marketed it to the business world as a machine with a "killer application," the Lotus 1-2- 3 spreadsheet. The PC's birth pangs rattled the geography of the U.S. computer industry. To speed product development, IBM had out-sourced the microprocessor and operating system. That new policy both recognized and accelerated the realignment of the industry away from the Northeast. Today, in the resurgent American IT sector of the late 1990s, the new dominant firms are headquartered in the West. The result might be described as "The Westward Rebirth of American Computing." (R.D. Norton, 1996.) In an earlier paper by that name, I made the case that the regional realignment was a key step toward restoring the U.S. lead in the information-technology race with Japan, because IBM and Digital Equipment Corporation (DEC) had bogged down in the bureaucratic inertia characteristic of large, mature firms. New entrepreneurs had to enter the arena, and their innovations could blossom best in the more open and fluid economic cultures of the West. This paper updates the story by examining where the world's leading IT firms were headquartered in 1997, and why. Our method is to structure the weltering crosscurrents of theory and evidence via five questions and to propose five tentative answers. The key issue is, "…and Why?" This, it turns out, is actually three distinct questions. The lead states in the new IT geography--California, Texas, and Washington--hold strikingly different roles in the spatial division of labor. In a nutshell, the Texans embody the efficiency and marketing skills that IBM and Route 128 once claimed. For its part, Silicon Valley is widely recognized as the world's most creative regional network for new activities--including Internet-related activities. Yet it is Seattle, not the Valley, that has become the current command center for the world's IT activities. Bill Gates, a classic robber-baron visionary, may have had as much to do with the westward realignment and the American resurgence as Silicon Valley's clustered fountain of youth. 1. WHERE WERE THE 100 "MOST INFLUENTIAL" I.T. FIRMS IN 1997? TABLE 1 shows the July 1997 PC Magazine list of the world's 100 "most influential" I.T. firms. The criteria for the list are subjective. As the compiler puts it, "Our effort to create this…list started (rather than ended) with a mere enumeration of the sales leaders. …we expanded our search to target not just the richest or best-known companies but the most influential. …And judging from 2 TABLE 1 PC MAGAZINE'S 100 MOST INFLUENTIAL PC COMPANIES IN THE WORLD IN 1997 1 Microsoft Corp. 2 Intel Corp. 3IBM Corp. 4 Netscape Communications 5 Sun Microsystems Inc. 6 Compaq Computer Corp. 7 Hewlett-Packard Co. 8 Cisco Sytems Inc. 9 Oracle Corp. 10 Toshiba Corp. Japan 11 Dell Computer Corp. 12 Apple Computer Inc. 12 Adobe Systems Inc. 14 Gateway 2000 Inc. 15 Novell Inc. 16 3Com Corp. 17 Corel Corp. Canada 18 America Online Inc. 19 PointCast Inc. 20 Packard Bell NEC Inc. 21 Softbank Corp. Japan 22 Intuit Inc. 23 Digital Equipment Corp. 24 Silicon Graphics Inc. 25 Symantec Corp. 26 U.S. Robotics Corp. 27 Canon Inc. Japan 28 Progressive Networks Inc. 29 Macromedia Inc. 30 id Software Inc. 31 Seagate Technology Inc. 32 Advanced Micro Devices Inc. 33 S3 Inc. 34 Acer Group Taiwan 35 Marimba Inc. 36 McAfee Associates Inc. 37 Micron Technology Inc. 38 Autodesk Inc. 39 Bay Networks Inc. 3 40 Creative Technology Ltd. Singapore 41 GT Interactive Software Corp. 42 Ascend Communications Inc. 43 Sony Corp. Japan 44 Cyrix Corp. 45 Diamond Multimedia Systems 46 CUC International Inc. 47 Computer Associates Intl. 48 AT&T Corp. 49 Texas Instruments Inc. 50 International Data Group 51 Seiko Epson Corp. Japan 52 Xerox Corp. 53 Iomega Corp. 54 Dialogic Corp. 55 Samsung/AST Research Korea 56 Logitech International SA Switzerland 57 Matsushita Electric Industrial Japan 58 National Semiconductor Corp. 59 PC Connection Inc. 60 Sharp Corp. Japan 61 Fujitsu Ltd. Japan 62 Hitachi Ltd. Japan 63 NEC Corp. Japan 64 Borland International Inc. 65 MetaToold Inc. 66 Matrox Graphics Inc. Canada 67 Sybase Inc. 68 MCI Communications Corp. 69 Motorola Inc. 70 Hayes Microcomputer Products 71 Adaptec Inc. 72 Philips Electronics NV Netherlands 73 Western Digital Corp. 74 Activision Inc. 75 Cirrus Logic Inc. 76 Cabletron Systems 77 ATI Technologies Inc. Canada 78 Aimtech Corp. 79 Computer Discount Warehouse 80 Quarterdeck Corp. 4 81 CompuServe Inc. 82 Idealab! 83 DeLorme Mapping Co. 84 Informix Software Inc. 85 Lexmark International Inc. 86 Madge Networks Inc., 87 Broderbund Software Inc. 88 Phoenix Technologies Ltd. 89 Power Computing Corp. 90 Be Inc. 91 Number Nine Visual Technologies 92 Eastman Kodak Co. 93 The Santa Cruz Operation Inc. 94 ViewSonic Corp. 95 Rockwell Semiconductor Systems 96 SAP AG Germany 97 The Learning Company Inc. 98 Tektronix Inc. 99 Yahoo! Inc. 100 Firefly Network Inc. 5 our own debate, the relative rankings of the group as a whole will be more than a little controversial." (Jake Kirchner, 1997, p. 214.) Several obvious caveats are in order here. First, the list attempts to answer the question, "Which companies are the true leaders in personal computing?" (P. 213.) Hence the perspective is from the PC industry, not from that of mainframes or (whatever is left of) minicomputers. Still, and as will be suggested shortly, PC's now set the agenda for all of I.T. Second, this is an American list; to that extent it is subject to the usual notorious cultural myopia of the U.S.A. Third, the lack of a single, objective criterion (like the ones used in the traditional Fortune 500 list, for example) renders the exercise open to dispute, as the editors suggest. These objections appear slight. Our concern is not whether the listing of Microsoft first, Intel as second, and IBM as third is precisely the right ordering. Further, perhaps a key firm or two at some functional distance from the PC industry, or in another country, has been mistakenly left off the list. Such nuances will not matter much here. The method to be employed below is simply to count regional (and national) locations, among the putative top 100. Any other list of the top 100 I.T. firms would probably show quite a similar histogram across regions and nations. This method does have its own specific bias or distortion, however. That is to give as much weight in a state's profile to a virtual unknown like Massachusetts' little Firefly Network Inc. (number 100 in the list, and since taken over by Microsoft) as to, say, IBM. One cannot necessarily judge a particular state's importance in the I.T. picture by the number of top-100 firms that call it home. Texas and Washington are cases in point--I.T. giants with few (or only one!) top-100 firms. THE LOCATIONS OF THE TOP 100 That said, a few basic observations can be made about TABLES 1 and 2. Our aim at this stage is only to lay out the landscape, not to explain the patterns. (1) Most (80) of the 100 top firms are American. Japan accounts for 10 listings: Toshiba (number 10), Softbank (21), Canon (27), Sony (43), Seiko (51), Matsushita (57), Sharp (60), Fujitsu (61), Hitachi (62), and NEC (63). Canada has three: Corel (17), Matrox Graphics (66), and ATI Technologies (77). Collectively, Europe has three (Switzerland's Logitech International, the Netherlands' Philips Electronics, and Germany's SAP), but none in the top 50.
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