Lean Times for Silicon Valley “Fighting for Every Penny”

Chris O’Brien of the SJMN put together a very good think piece on the state of Silicon Valley’s economy, and it isn’t pretty. “As companies try to cut costs throughout the food chain, the number of tech jobs continues to decline.”

Where are the jobs and the sales? “There are a ton of opportunities overseas” (Christine Heckart, Juniper’s vice president of marketing). And why? Simple – costs. “In the first 20 or so years of the technology age, the vendors held all the cards. But now, the fulcrum of power is not with the vendors or consultants. It’s with the customers” (Gary Beach, publisher of CIO Magazine).

This impacts all levels of our industry – not just IT workers, but sales, marketing, suppliers and manufacturers, and even investors.

While the article is quite gloomy – “They’re all fighting for a pie that isn’t increasing as fast as they’d like to tell their shareholders. Everyone is aggressively trying to cut costs. You’ve got to fight for every penny.” (Martin Reynolds, technology spending analyst for Gartner) – the fundamental assumption by all these experts is that tech needs will remain static, resulting in an ever-shrinking market dominated by a few big players. While that may be true for all those incredibly complicated and expensive enterprise integration companies that CIO’s are obsessing over, these companies are not the tech trend-setters of Silicon Valley and perhaps should rightfully be outsourced. New “takes on tech” are always the beginning, not the end, of the cycle.

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