Clean Energy Jobs Take Off

The Pew Charitable Trusts released a study Wednesday of clean energy jobs, the first hard count of that market. The Pew study shows that job sector grew by 9.1% between 1998 and 2007 compared to overall job growth of 3.7% during the same period.

The high growth rate is partly the result of the small number phenomenon. Pew researchers counted 68,200 businesses and 770,000 jobs across the U.S. tied to clean energy as of 2007--a mere 0.5% of the national total. But the Pew report predicts "explosive growth" in the clean tech sector over the next several years, due to a surge in private investment and the huge amount of money the federal government plans to plow into 'clean energy'.

The Pew report defines the "clean energy economy" as:

1. Clean energy development and production (wind power, solar, biomass, tidal, et al)
2. Energy efficiency
3. Environmental improvements in products and and manufacturing processes
4. Conservation and pollution mitigation, including recycling
5. Training and support

Not surprisingly, California came in #1 in terms of venture capital investment in green jobs (Table 1).


















The number of clean tech job didn't entirely follow the money, but they did grow fastest in California and Texas, both of which heavily promote the sector (Table 2).

Don't Mess With Texas

According to Kil Huh, who led the Pew Study, "Texas is the sixth-largest producer of wind energy in the world. The state's clean-energy economy is poised for incredible growth." The state also ranked third in clean-energy venture investments and fourth in clean-energy patents. The Pew study attributed much of this growth to the state's policies on fostering renewable energy enterprises. But there's another side to that story, too.

In 2007 Texas had 40,167 jobs tied to conservation and pollution mitigation, accounting for over 70% of the jobs in the clean energy sector. Texas has always been a leading energy producer, and the state government is determined to be a leader in new energy sources, at which the Texas Emerging Technology Fund and Austin Ventures are throwing a lot of money. But if Texas were a nation, it would be the seventh largest producer of greenhouse gases, thanks largely to its fondness for coal-fired power plants and big pickup trucks. So it's only fitting that as 'green/clean tech' catches on, Texas is profiting from cleaning up its act.

California--with its plentiful supply of hydroelectric power--may get snooty about this, but let's give credit where credit is due. "Doing well by doing good," etc.

[Full disclosure: I'm a Bay Area native happy to be living in a state that includes Austin, Luckenbach and great BBQ.]

--John Donovan

Low-Power Design

My apologies for the lack of action on this blog, but I've been working overtime putting together a new web site that will make its debut in late June.

If you've bemoaned the loss of Portable Design, don't worry--we've assembled some great editorial talent to help fill that void. The focus will be different, but we'll provide the same in-depth analysis of the issues facing designers of low-power portable applications that PD supplied for 12 years.

Stay tuned for www.low-powerdesign.com--a true vertical portal and design community.

Journalism vs. Marketing

The New York Times ran an obituary this morning for Encarta, Microsoft’s erstwhile multimedia encyclopedia. Since its introduction in 1993 for $395, Encarta was subsequently marked down to $99, $29.95 and most recently $22.95. Microsoft will soon cease selling and shut down its web site.

Yes, Encarta was done in by Wikipedia, but even more so by Google. As the Times observed, “Microsoft soon learned that the public would no longer pay for information once it was available free.”

During Encarta’s slow demise, Microsoft was started counting less on sales receipts and more on embedded advertising. You could read carefully researched articles but you had to endure vendor product pitches. Sound like your typical magazine or newspaper? They also rely heavily on ad revenues, since readers are increasingly disinclined to pay for subscriptions.

But a parallel logic, unfortunately, also applies to advertisers. Why pay a fortune for expensive print advertising when you can reach more people more cheaply with online ads? OK, you have a problem with metrics, but here you have a potentially interactive medium that can generate sales leads, something that’s hard to match in print. And it’s cheap.

That logic is killing print, both newspapers and trade magazines. Quite frankly, I don’t see a way around it. The problem then becomes, how do you make money online, where you’re essentially trading print advertising dollars for dimes? This is the $64,000 question that’s consuming everyone in the publishing industry. I don’t claim to have the answer, but I do have a provocative suggestion.

I think vendor-based magazines—whether print or online—are the future of trade publications.

The publishers who put out the trade mags you read have long made a bundle on “specialty publications,” or magazines they produce on contract for individual vendors. Their editors frequently contribute articles focusing on the vendor’s technology or even products, walking a fine line between editorial integrity and pushing marketing bullet points. The editors are never comfortable doing this, but it puts food on the table.

I think this is a growing trend, and an increasingly honorable one. Mentor Graphics puts out EDA Tech Journal, which is well read and well balanced—with kudos both to Mentor and my old colleague Paul Dempsey. Mike Santarini, since being laid off at EDN, has started publishing Xcell Journal for Xilinx—a very slick magazine. And Rich Goering didn’t stay unemployed long before being snatched up by Cadence to start an e-newsletter for them, which I’m sure will retain the same high standard for which Rich has always been known.

I hate to say it, but I think Rich Goering and Mike Santarini are the future of publishing, which will be vendor driven. The online world is full of new sources, very few of which are making money. Yes, a lot of them are dreck, but that's how it works. That also means that there's room for trusted gurus, if they can just figure out how to make a living.

I see a wide range of online tech news sources, with a smattering of guru blogs that people trust. The blogs will be well supported by advertising, but not enough to support the overhead of a big publisher. All the major semiconductor and EDA companies will have their own online magazines, employing the best editors.

Journalism will slide farther down the slippery slope toward marketing, with the best editors—with the blessing of the more enlightened vendors like Mentor—still having a lot of latitude to express their occasionally acerbic opinions.

They’ll just be working within a smaller box.

Hello and Goodbye

Well, all this talk about how print is hurting suddenly became more personal yesterday when the plug finally got pulled on Portable Design. That ends a 12-year run for the magazine, including four with me at the helm. I'm now, as they say, "looking to pursue other opportunities."

If a rising tide lifts all boats, an ebb tide can leave them high and dry--especially small boats like PD. With even big publishers like "The Company Formerly Known As CMP" downsizing their print books (read: laying off my friends), there's a limit to how long smaller outfits like the RTC Group can hang in there in a down market. Between a huge increase in competition in our space over the years; a strong move from print to online, with a corresponding sharp drop in ad revenues; and the current recession, it was time to pack it in. I give RTC a lot of credit for hanging in there with me and PD, but this was the right thing to do.

I don't have any plans at the moment, though starting online magazines or e-newsletters for clients is an interesting idea, as is doing some more in-depth research than is possible under deadline pressure. If you have any bright ideas, feel free to let me know. You can reach me at jpdonovan@ieee.org. I'll keep the blog going, so posts here are also welcome.

Best regards,
John

UPDATE (5/4): I didn't at all mean to imply above that the RTC Group will have trouble "hanging in there"--I was referring to there being a limit to how long they could "hang in there" losing money on PD. To reiterate: I agree with John R's decision to pull the plug on PD, sad as that was. The RTC Group as a company is doing quite well despite the downturn, not the least for making intelligent, if difficult management decisions. -- JD

Setting Wireless Engineering Standards

In Portable Design we’ve long covered the evolution of wireless standards and applauded when new wireless interfaces finally emerged from standards bodies. It’s only by having universally recognized standards that these technologies can really be successful.

But what about standards for wireless engineers? Every year hundreds of schools in scores of countries graduate thousands of wireless professionals. Some graduates have a pretty basic education in the field, others a very advanced one and still others a lot of depth in a very specialized area. Unfortunately there is no common set of educational requirements for entry into the field and a great deal of variability globally in the quality of training. There are a lot of good people out there, but it’s hard to tell who they are.


Last year the IEEE Communications Society (Comsoc) launched the IEEE Wireless Communication Engineering Technologies (IEEE WCET) Certification Program to provide eligible individuals with a quantifiable method for demonstrating their expertise in wireless communications. Designed by IEEE ComSoc and an international collection of industry experts, the program was also designed to offer employers based throughout the world with a certifiable means for gauging the qualifications of wireless professionals.

According to Celia Desmond, the WCET project director, the project involved over 100 people worldwide working together for two years to develop the exam, which was first administered last October. In December, 2006 Comsoc formed the Practice Analysis Task Force (PATF), consisting of 16 industry experts with a wide range of experience. Every effort was made to focus on the practical knowledge and skills needed to be a successful wireless engineer; academics were only allowed to be involved if “they had one foot in planted in the industry.” The task force defined the scope of the exam and categorized the materials into seven knowledge areas: wireless access technologies; network and service architecture; network management and security; RF engineering, propagation and antennas; facilities and infrastructure; agreements, standards, policies and regulations; and fundamental knowledge.

Having drafted an initial set of questions, Comsoc then held focus groups around the world at wireless conferences and IEEE regional meetings. Each focus group took upwards of three hours, during which participants critiqued and refined the questions. The results were then sent to 14,000 people in the wireless industry, of whom 1,000 responded. They were asked, “In your company, how important is it that people know this information and be able to perform these tasks?” This feedback was used to determine the percentage of questions in each topic area; for example, technical questions make up 20% of the exam, while infrastructure takes up only 6%.

The exams were next sent to a group of industry professionals to build a question bank; other groups reviewed the questions. The rigorous program development process was highly moderated all the way through by Professional Examination Services.

The first exam—150 multiple choice questions administered on computer at regional testing centers—was held worldwide in October, 2008; a second one from March 16-April 4, 2009; the next one is scheduled for Fall, 2009.

Applicants for the test receive “A Guide to the Wireless Engineering Book of Knowledge (WEBOK)”, a 250-page treatment of technical, infrastructure and regulatory issues facing the wireless industry. Comsoc warns that “The WEBOK should not be reviewed as a study guide for a wireless certification exam…It is rather an outline of the technical areas with which a wireless practitioner employed in industry should be familiar, and offers suggestions as to where to turn for further information and study.” Applicants can also take a practice exam online to help them further identify areas they need to review.

The US$500 fee ($450 for IEEE and IEEE ComSoc members) covers the application, processing fees and “seat fee” for taking the test. A certificate is sent to those who pass the exam.

Portable Design strongly supports the WCET program and urges its readers to check it out. Interested professionals can visit www.ieee-wcet.org for program information and updates including eligibility requirements, testing dates and locations, application information including deadlines, examination specifications, links to training organizations, and free resources such as a glossary, a list of references, and sample questions for helping candidates thoroughly prepare for the exam.

IEEE Communications Society, New York, NY (212) 705-8900 [http://www.comsoc.org/]

--John Donovan

Innovate or Stagnate

The New York Times today carried a story about how the U.S. is losing its competitive edge. A report from the Information Technology & Innovation Foundation (ITIF) found that the U.S. ranked sixth among 40 countries and regions based on 16 indicators of innovation and competitiveness, including venture capital investment, scientific researchers, spending on research and educational achievement. In terms of progress over the last 10 years the U.S. came in last.

By almost any measure the U.S. has a greater number of academic researchers, Nobel Prize winners and corporate R&D labs than anyone else. However, the foundation report adjusted for the size of each economy and its population. In most categories the U.S. wasn’t even close:

Adjusting for populations enables apples-to-apples comparisons, but it requires caution in interpreting the results. Luxembergians (Luxembergers?) may be highly productive rich people, but I don’t expect to see all our R&D suddenly fly offshore to this tiny banking center. Of course I could be wrong: Skype is headquartered there, eBay is eyeing it and the country is courting Internet startups. OTOH China’s huge IT investment should have huge payoffs, as will Russia’s investment in higher education and Singpore’s major incentive program to cultivate and attract innovative technology companies.

In the Times’ words,

“Some countries, including Singapore, Taiwan, Finland and China, are pursuing policies that are explicitly designed to spur innovation. These policies typically try to nurture a broader “ecology of innovation,” which often includes education, training, intellectual property protection and immigration. This is in contrast to the industrial policy of the 1980s in which governments helped pick winners among domestic industries.”

It’s also in contrast to anything the U.S. is doing, which includes under-funding education; enacting punitive (or at best counter-productive) immigration policies; and providing practically no funding or even tax incentives for worker retraining.

I lived in Singapore for a few years (1988-90)—working for the old National Computer Board—and got to observe first-hand a country run by technocrats: the “Switzerland of the Pacific” (or the more acerbic “Disneyland with the Death Penalty”). While I’m not enamored of Singaporean politics, their ruling bureaucracy runs like the proverbial Swiss watch. Highly skilled foreign workers are openly courted and offered a path to citizenship—in contrast to the U.S., where when your H1-B or student visa runs out you have 30 days to get a job or leave the country. Over 20 years ago Singapore set out to be a ‘wired island’, computerizing all businesses and agencies and giving everyone high-speed Internet access. Singapore ranks ahead of the U.S. in almost all of the ITIF’s innovation scores.

More recently Singapore has set out to be a Center of Innovation, teaching Lateral Thinking and Innovation from the grade school level on up. This initially met with some humor, since Singaporeans aren’t known for being a very creative, over the top lot. But Creative Technologies showed that a Singaporean tech company could be a contender on the world stage, and the government has set out since then to provide a wide range of incentives to encourage innovation.

The Obama administration has targeted most of the shortcomings in the ITIF’s innovation list for both attention and funding. But our newly minted technocrats would do well to take a close look at a more holistic approach like Singpore’s. Forget the overtones of Japan's industrial policy in the '80s. "It's the economy, stupid!"

Surviving the Crash

As of this writing, the papers are celebrating the heroic U.S. Airways pilot who successfully crash landed his plane in the Hudson River, saving all 155 passengers on board. Will the captains of the electronics industry be able to save their own ships from the current economic crash?

While the electronics industry in general and the semiconductor industry in particular have had recurrent ups and downs, there is little doubt that this down cycle is going to be one of the worst ever. Both industries are likely to look very different when they emerge from the trough.

Forget Startups

According to the National Venture Capital Association, VC fund-raising fell 71% in the fourth quarter of 2008 due to the recession and aversion to risky investments. For all of 2008, U.S. VCs pulled in just under $28 billion, down 21.4% from the $35.5 billion raised in the prior year. This money is largely going to established startups who are already selling a product and who, with some more marketing oomph, are likely to make a profit. On top of this, in all of 2008 there was only one initial public offering (IPO) to come out of Silicon Valley. With investors risk averse and no exit strategy in sight, VCs are becoming risk averse, too. New startups are toast. This will starve the industry of both innovation and the acquisition targets that enable larger players to innovate fast enough.

Forget Profits

This almost goes without saying. Innovation is the key to profits, since consumers are willing to pay a premium for cool new features. But competition always drives down price; if you can’t continue to compete on features, you’ll soon find yourself in the death spiral of competing on price. During a recession, it’s almost impossible to avoid the latter. It becomes a matter of survival of the fittest, and major industry consolidation is already underway. In good times, the market will penalize you for sitting on a pile of cash; now only companies with large cash reserves and well diversified cash flows are likely to survive. One financial analyst summed up the situation by describing his recommended positions during this recession: “Cash and fetal.”

Go Fabless

The days of “real men have fabs” are over. The CAPEX is unsustainable and TSMC can do it better than you, anyway. AMD has pushed its fab off its balance sheet, talking Abu Dhabi into investing in it (good luck, guys). Cypress is outsourcing all fab work under 90 nm, and TI is doing the same at the 45 nm node. Except for hanging onto an R&D fab—Cypress has even managed to monetize theirs as the Silicon Valley Technology Center—there’s no excuse for not diverting the CAPEX you’d otherwise spend on a fab into R&D. This is a game only the big dogs can play, and even they’re banding together to spread the pain around.

Get out of DRAM

If there was ever a commodity product, it’s DRAM. Everyone involved with it is losing money; Qimonda is in such dire straits that its owners can scarcely give it away. Micron converted much of its DRAM fab capacity to manufacturing flash memory, which until recently was a license to print money; now flash looks to be the next DRAM.

In the 90’s Korean companies undercut the Japanese to take over the DRAM market from them; now the Taiwanese are out to do the same to the Koreans. They’d better look over their shoulders at the Chinese. It’s time to end this losing game and get out of DRAM. Let SMIC or Grace make it all. Good riddance.

Consolidate

To achieve the critical mass to survive an extended downturn, consider merging with your competition. Lattice and Actel both have similar technologies, and both continue to watch Altera and Xilinx walk away from them; they’d be stronger if they combined forces, just as Lattice previously did with Vantis.

Cypress and Micron would be another logical pairing, though it’s difficult if not impossible to imagine T.J. Rogers and Steve Appleton jointly running the company. When you factor in executive egos, you’re more likely to see consolidation take the form of acquisitions, resulting in the industry having fewer if larger players after it all shakes out.

I’m beginning to understand why the ancient Chinese saying, “May you live in interesting times,” isn’t a blessing but a curse. These are going to be interesting times. Fortunately, like everything else, they’ll pass.