The world's tech hot spots

The next big tech hub, according to venture capitalist Tim Draper, is an apartment.

"I believe that entrepreneurship is not regional anymore," said Draper, the managing partner at Menlo Park, Calif.-based Draper Fisher Jurvetson, which has been successful in placing investments overseas. "Anyone with an Internet connection and a cell phone can start a globally successful business."

Recent history supports his point. Skype, the voice over Internet Protocol service, grew out of Estonia at a time before the Baltics were hip. Google isn't the No. 1 search engine in China. Baidu, founded by local entrepreneur Robin Li, is. And local media outlets such as Focus Media and Tudou are soaking up the opportunities multinationals thought would be theirs. And Palo Alto, Calif., security start-up Fraud Sciences? It comes from Israel.

Still, those apartments likely will crop up in geographic clusters. There are reasons that Silicon Valley is still the epicenter of tech and that attempts to start rivals in Scotland, Virginia, and Idaho never got as far. Sometimes it's because a university encourages students and professors to commercialize their ideas. Other times, government incentives and subsidies jump-start an industry.

If you're looking for the next big idea, there's a good chance it could come out of one of the places on this list.

Asia

If you had to pick a continent where most of the innovation in the 21st century will take place, Asia wins hands down. Nearly every government is offering large incentives to tech companies, the universities are competitive globally, and in many places working for tech companies remains the primary avenue to escape grinding poverty. Here in the U.S., people go to Wall Street instead.

Biopolis. It sounds like Aquaman's home, doesn't it? Actually, it's a state-of-the-art research complex at the center of a multibillion-dollar initiative by Singapore. Started in 2001, Biopolis has attracted biotechnology companies such as Merck (with $650 million invested in the country), Genentech, Abbott Laboratories, and Novartis, all of which are establishing operations there.

Biopolis also has recruited premier U.S. academics--such as Edison Liu, former director of clinical sciences at the U.S. National Cancer Institute--to conduct research there. To attract promising postdoctorates, Singapore's Agency for Science, Technology and Research offers as much as $500,000 a year in funding. Recently, the National University of Singapore opened up the first U.S.-style medical school in East Asia and enrolled its first 26 students. Duke University helped set it up. Graduates will get a joint Duke-NUS degree.

Hyderabad and Pune. Bangalore, in the southwest of India, remains the center of India's high tech industry, but problems have emerged in recent decades. Costs have skyrocketed, traffic is murder, and worst of all, companies poach each other's employees.

As a result, companies are moving elsewhere in South Asia. Microsoft's biggest campus outside the U.S. is in Hyderabad, to the east of Bangalore. "The state government has been quite supportive of the tech industry, and there has even been talk about opening a fab (chip fabrication facility) there, though I don't think this will happen, because the infrastructure is not good enough," said Richard Brown, vice president of marketing at Via Technologies, a chipmaker based in Taiwan.

A couple of hours from Mumbai (formerly known as Bombay) sits Pune. IBM, outsourcing company Infosys Technologies, and several other American and European companies have set up their offices in Pune, says Ravi Pradhan, CEO of Bollywood3D, which makes video games based on Bollywood movies. BMW, VW, Mercedes-Benz, and several Japanese auto giants have set up plants there.

Pune has the largest number of engineering and management colleges and institutes in the region, Pradhan says, noting that "Pune gets overshadowed by Mumbai. But with relatively cheap real estate, good public transportation, and better road and traffic management, Pune has become and will become a better alternative to Bangalore." You also see start-ups there such as LAN-network specialist Nevis Networks, funded by chip legend Vinod Dham.

Look for activity in Chennai (formerly Madras). The city is home to one of the branches of the Indian Institute of Technology, the engineering college whose good-old-boy network is at the heart of India's tech industry. Professor Ashok Jhunjhunwala leads IIT Chennai's Telecommunications and Computer Networks group, which has incubated companies producing inexpensive ATM machines and wireless networks.

Tsinghua University. China is a huge country with more than a billion people, but if you had to pinpoint the epicenter of the nation's economic future, it's the Tsinghua campus, which sits on a few acres in northern Beijing.

The school attracts the nation's top technological students, and graduates are peppered throughout the country's leading companies and scientific ministries. "A lot of the VCs and most of the entrepreneurs have come out of here," said Tsinghua graduate Gavin Ni, CEO of Zero-2-IPO, an investor information service.

The Chinese government also uses the university's labs to come up with standards for high-definition TV, security monitoring, and wireless communication. The China Grid, a massive grid that connects all of China's university supercomputers? It's in the basement of Tsinghua's engineering building.

The U.S. connections to Tsinghua are strong. Originally a preparatory school for Chinese graduate students intending to study at American universities, the school was founded in 1911 out of reparations paid by China to the U.S. after the Boxer Rebellion. Hewlett-Packard opened its first university lab there earlier this year, and exchange programs exist with most major U.S. campuses and companies. Tsinghua also has its own agent in the U.S.

Hsinchu Science Park. Pronounced Sin Shoe, this industrial park south of Taipei, Taiwan, is filled with ivory-colored, nondescript buildings, but it's where engineers and executives figure out how to manufacture a huge portion of the world's chips, notebooks, printers, scanners, LCD TVs, and other equipment. Residents include chipmakers Taiwan Semiconductor Manufacturing and United Microelectronics, consumer electronics specialist Hon Hai, notebooks maker Quanta, and display maker AU Optotronics.

Although many companies based here have opened factories in the People's Republic of China, Taiwan remains the place where the logistics are concocted and a lot of stuff gets manufactured. Nearly 120,000 people work there. Revenue from the industrial park in the first eight months of the year has come to $22 billion, according to the Taipei Times. Every time there's an earthquake in the geologically volatile region, the entire electronics world shakes.

The PC Baangs in Seoul. Following the 1997 Asian monetary crisis, the South Korean government launched an ambitious plan to build the world's most robust broadband network.

The result? South Korea is now a world center for broadband consultants, wireless phone applications, and online games played around the clock at Internet cafes, or baangs. It was also a testing ground for blogs and social networks. Many of these products and concepts have migrated to China and other neighbors. Entering Western markets directly has been tough for many South Korean firms, although a lot of their ideas have percolated over.

A design studio in Japan. Japan has been riding a crest for the last few years on the strength of two products: flat-panel TVs and digital cameras. Although the products often get manufactured in China, the engineering and design take place in Japan, which remains third in spending in research and development.

But Japan also markets aesthetics, which can be seen in anime and household appliances. In the future, expect to see Panasonic and other consumer-appliance makers bring to the U.S. the small, intricate, energy-efficient appliances found in Japanese homes. Also look for security systems and intercoms that feed into the TV and cell phone. In the realm of clean-energy alternatives, Sharp and Kyocera--best known for consumer electronics--also remain two of the biggest solar companies globally.

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