Net Loss: Internet Prophets, Private Profits, and the Costs to Community

4. Business Cooperation and the Business Politics of Regions in the Information Age

Business Cooperation and the Business Politics of Regions in the Information Age 4 In early , Silicon Valley faced an economic crisis where job growth since the mid-s had been lagging behind the national average. Fed by both defense cutbacks and a sense of foreign and domestic competition against their hightech products, business leaders in the region created a new organization called Joint Venture: Silicon Valley, its goal ‘‘a community-wide effort . . . to construct a rational blueprint for the continued economic vitality of Silicon Valley.’’1 With the publication of a commissioned report , An Economy at Risk, along with a jammed conference of technology leaders—with more than one thousand attendees—that was held by the new organization in the summer of , the organization became the focus for business revitalization within the region. Belatedly, government leaders were also encouraged to become involved, with San Jose mayor Susan Hammer becoming co-chair of the organization in . Not only would Joint Venture work to strengthen existing high-tech organizations such as the San Jose Chamber of Commerce, 127 128 Net Loss the Santa Clara Valley Manufacturing Group, and the American Electronics Association, it also unleashed a host of new working groups and a range of new incorporated organizations. One of these spin-off organizations was Smart Valley, its vision being to ‘‘create an electronic community by developing an advanced information infrastructure and a collective ability to use it.’’2 Smart Valley, in turn, would become the catalyst for a host of initiatives and new organizations focused on using advanced communication technology to strengthen the regional economy. For most in Silicon Valley in the early s, the Internet was seen not as a focus of commerce itself but rather as a new tool for regional revival, of the creation of electronic communication bonds that would bring about more efficient production within the region. In doing so, Smart Valley was following the model of Singapore, a ‘‘smart island,’’ and the ‘‘science cities’’ being planned throughout Japan, themselves in turn trying to improve on the model of regional technology development in Silicon Valley itself.3 Two major initiatives of Smart Valley, CommerceNet and the Bay Area Multimedia Technology Alliance (BAMTA), were in turn incorporated as separate organizations with greater yearly funding than that of their parent (thereby adding to the explosion of interlocking business organizations spawned by Joint Venture). CommerceNet, initially chaired by John Young of Hewlett-Packard and involving almost every major computer company in the region, was established with an early vision to make business-to-business networking over the Internet more feasible, while BAMTA saw its mission as uniting together the diffuse and often noncooperating artistic, software, and hardware talents of the Bay Area in creating new multimedia technologies over networked technology. All these initiatives seemed to be fulfilling the original mandate of Joint Venture to strengthen Silicon Valley vis-à-vis other regions. However, both these spin-off initiatives rapidly went through transformations that downplayed their specifically regional nature in favor of allegiance to a national and even global perspective on the industry. CommerceNet had allowed a few non–Bay Area companies and federal agencies in its membership from early on. Such outside members proliferated so quickly that CommerceNet began talking of creating regional subgroupings around the country, which was followed by the acceptance of foreign member companies, including Japanese companies, revealing a rather startling change from the nationalist anti-Japanese stance of the Valley in the s. While the bulk of members still hailed from the Bay Area, the organization began to publicly downplay any specific regional focus. Similarly, BAMTA very quickly expanded its mem- Business Cooperation and Business Politics 129 bership nationwide and globally and soon officially wiped the words Bay Area from its name, preferring ‘‘Broad Area Multimedia Technology Alliance.’’ What did this transformation mean? For companies that established the network and remained heavily involved, it did not necessarily mean a loss of loyalty to their home base in Silicon Valley. However, it did reflect the technological, social, and economic forces buffeting the high-technology economy and how these institutions in turn played real roles in reinforcing those same globalizing economic forces. Further, these changes reflected the specific alterations that led the Internet from being seen mostly as a high-tech tool for regional revival back in  to being perceived as a global industry unto itself by  and...