Silicon Valley won’t last forever; Texas knows it

Is Texas really a serious rival to California as a destination for high-tech? The growing exodus of banner companies — Oracle Corp, Hewlett-Packard Enterprise Co, Tesla Inc’s Space-X and others — suggests that there’s something to the idea. Still, skeptics rightly point out that plenty of other places have made a bid to become the new Silicon Valley and never come close.
Texas, though, may be different, and not because of the recent high-profile relocations. Unlike other would-be innovation hubs, the state has been quietly nurturing high-tech industry for decades. If Texas eventually rivals California, the consequences could be momentous, not just for industry, but for US politics.
A bit of background: At various times in the nation’s history, different locales have emerged as clusters where industrial innovation has flourished, spawning powerful new corporations and staggering amounts of wealth. These “places of invention” attract a critical mass of companies and talent. They often depend on institutions that train
the next generation of workers and entrepreneurs.
Silicon Valley fits the model. As Margaret O’Mara has observed in her entertaining history of the region, a critical convergence of engineering talent, venture capital, educational institutions and government money unleashed waves of innovation, each building on the previous one to generate ever-larger economic booms.
But nothing is forever. Consider the fate of Hartford, Connecticut. That city was once a high-tech powerhouse in the late 19th century, dominating precision engineering and instrumentation. Its glory days are long gone. Other centers of innovation and invention have suffered similar fates: Philadelphia, which largely pioneered machine-tool production; Detroit, crucible of the automobile industry; and others. If Silicon Valley loses its marquee status, it will almost certainly give way to several hubs in Texas, a state now more readily associated with Ted Cruz, capital punishment and crude oil. The idea that it could ultimately displace California as
the leading centre of innovation seems far-fetched. Except when you take a closer look — and go far back in time.
As one account of Texas’s high-tech history has argued, a new age dawned in 1930. The year brought news of the largest oil discovery ever made in the lower 48 states: the so-called Joiner Strike in the East Texas oil patch. But it also saw the creation of Geophysical Service, a company that used sound waves to prospect for oil, which quickly became an industry standard. The company grew rapidly, expanding into submarine detection during World War II.
In 1951, the company became Texas Instruments, one of the giants of the computer age. Three years later, TI became the first company to design, build and market silicon transistors; seven years later, it developed the first integrated circuits, or computer chips. These became the building block of everything from hand-held calculators to computers. Even as Silicon Valley became the visible leader in computing technology, Texas Instruments flourished in Dallas, growing ever larger.
—Bloomberg