When most people think of the technology industry, Silicon Valley likely springs to mind. After all, it's been the global hub for technology innovation since the early 1960s, which saw the birth of some of today's largest companies, like Intel, HP, AMD (News - Alert), and Nvidia. In the decades since, the region has become home to just about every major technology firm in existence – and cemented its role as the center of the tech universe.
Lately, however, an upstart on the other side of the world has started to build up its technology bona fides and may be primed to challenge Silicon Valley for the technology crown. In this case, however, it isn't a city, it's a whole country: Australia. Over the past decade, the nation has made enormous strides in developing a technology industry that could come to rival that of the United States, and investors are starting to take note. Here's an overview of why Australia could be ready to become the next global technology hub.
From The Ground Up
The recent surge in Australia's technology industry didn't happen overnight, nor did it happen in a vacuum. It's the result of a major realignment of national goals, driven by the national government. It began around 2007, with the creation of the Department of Broadband, Communications and the Digital Economy. Their mission was to chart a course for the nation to move toward a 21st-century information economy, through targeted investment and infrastructure upgrades.
A key component of the initial plan was the rollout of a National Broadband Network (NBN) that would extend modern, fiber-based internet access to all points in the expansive country. Although progress in building it was slow and it experienced no shortage of delays and difficulty, the effort seems to have had the desired result, economically speaking.
Multiple Technology Centers
Today, thanks in large part to the government's strategic planning; Australia is now home to several burgeoning technology centers. The largest among them, Sydney and Melbourne, account for about 75% of the growth in the nation's technology industry and are home to some of the nation's biggest tech firms. Sydney, in particular, boasts some of the most well-known Australian tech giants, including Atlassian, Canva, and Airtasker. At the same time, Melbourne has drawn in branch offices of well-known international firms like Slack, Etsy (News - Alert), and Stripe.
The government's strategy didn't stop with the major population centers, though. They also announced an initiative to turn their legacy mining industry in Western Australia (WA) into a modern technology innovation engine. The core of the plan is a new $135 million lithium battery research hub that aims to become the go-to global battery technology source, which will quite literally power the global technology industry in the coming decades. They've also bolstered those efforts by expanding government-sponsored TAFE courses in WA to grow a high-skill workforce in the region to feed the new businesses expected to flock to the area.
Outperforming Rivals
Even at this early stage of Australia's growth in the global technology space, there are already some signs that all of the efforts are paying off. Early this year, the success of Australia's tech firms fueled a stock market boom that saw their values rise as much as 200%, besting the tech sector performance in the US and China by significant margins. At the same time, foreign tech firms began to pour money into the country, hoping to gain a foothold in what they consider a market with plenty of room for growth.
Money isn't the only thing that Australia's technology industry has been attracting of late. It's also been drawing highly-skilled foreign workers into the country, to keep up with labor demands as the industry grows exponentially. That may represent the strongest sign of Australia's ascent into the upper echelons of the global technology market. When you consider that the influx hasn't driven local unemployment rates up either, it's all the more impressive as a sign of the enormous growth that's happening there.
The Bottom Line
Although Australia still has a long way to go to supplant Silicon Valley as the technology capital of the world, it's showing every sign that it may well accomplish the feat in the long run. From coast to coast, the industry is in a growth phase, and there's still plenty of room for it to continue. By comparison, Silicon Valley itself is starting to hemorrhage both talent and the businesses that it's become synonymous with. All the while, Australia continues its tech ascent. If their big bets on battery technology and building a skilled workforce through comprehensive training pay off – then Silicon Valley had better watch its back because the Aussies are most definitely coming for its crown.
