Hong Kong Technology Roadmap
Charles K. Kao
Abstract ……………………………………………………………………….. 1
Introduction …………………………………………………………………… 3
Pre-1983 Days ………………………………………………………………… 5
The 1991 Technology Roadmap ……………………………………………… 7
Moving Towards Year 2000 ………………………………………………….. 21
The Year 2000 Scenario ………………………………………………………. 29
stThe Information Technology of the 21 Century ……………………………... 37
The Year 2000 Hong Kong Technology Roadmap …………………………… 41
Ref. 1 The 1991 Hong Kong Technology Roadmap ………………………….. i
Ref. 2 The 1991 Technology Road Map in Pictorial Form …………………… ii
Ref 3. Various Consultant Reports Generated around 1991 ………………….. iii
The use of technology has always played an important role in the development of Hong Kong. The use of sttechnology has enabled it to march in tune with the global progress. As we entered the 21 Century, Hong Kong
stands as a thoroughly modern city with an infrastructure comparable to the best in world cities. This paper presents a historic and a future perspective of the effort spent in the development of technology in Hong Kong. After introducing the situation in Hong Kong during the pre-1983 period, the construction of the 1991 Technology Roadmap and the outline of the year 2000 Technology Roadmap are discussed.
The 1991 Technology Roadmap was authored by people from a number of academic institutions in Hong Kong. At that time, the strength of the economy of Hong Kong lay principally in the financial and trading sectors. It was the goal of the study to provide illustrations of some promising processes and their necessary supporting structure that should be undertaken, to assist the growth of a technology driven industry. The roadmap was designed to allow the readers to walk from the then current situation, to reach the target opportunities with specified R&D investments. An extract describing the impact of Information Technology and the development status of Broadband Technology is presented from the 1991 Technology Roadmap Report which was published as a book. The 2000 Technology Roadmap has not been fully constructed. In the course for its preparation, the current technology scenario in the year 2000 is presented as an extension of the 1991 technology scene. The need to participate in the development of technology, in order that we may have the foresight of new product and service opportunities in good time, is emphasized. With technology advancing rapidly, Hong Kong must enter the competitive arena on a level playing field. There is no longer a chance to play the catch up game and win as in 1991. Through a situation analysis, and a comparison of the major differences between the year 1991 and 2000 scenarios on Information Technology, the areas to be included in the 2000 Technology Roadmap are: Information Technology, Biotechnology, Materials and Nano Technology. Apart from the Nano Technology, the other areas are the same ones as in 1991. For three of the areas, a proposed project is described for each area. The 2000 Technology Roadmap should be written by a team of experts as soon as possible.
As an aspiring world city, the development and use of technology has always played an unsung but important role. As we enter the 21st Century, Hong Kong stands as a thoroughly modern city with an infrastructure comparable to the best in world cities. Its use of technology has enabled Hong Kong to march in tune with the global progress. Its development of technology is not significant. There is a consensual opinion that Hong Kong must take a bold and necessary step to strengthen its technology development, or lose its healthy competitive posture.
Why is the development of technology so important? Hitherto, Hong Kong has
progressed well by being able to use technology advantageously. What has changed? The rapid advances coupled with a fast rate of maturation in key technologies are outstriping our ability to adopt the technologies before they become obsolete. Even if information technology is enabling information and knowledge to be readily accessed on a global basis, at an affordable cost, and key technologies are available from multiple sources as they approach a mature state, we cannot act fast enough to stay competitive.
Under this environment, unless we participate effectively in the technology development process, we will not have an opportunity to compete on a level basis. The cognizance of the time dependent progress of technologies is of paramount importance. We must participate in the course of technological progress before we can appreciate the evolving market and opportunities for future products and services. With a focussed participation in up-stream, and in particular mid-stream research and development to match our advantages, the required foresight for the identification of opportunities is gained.
This paper gives an account of the three stages of technology development in Hong Kong: the pre-1983 period, the 1991 technology roadmap, and the Year 2000 technology roadmap. 1983 is the year when Sino-British agreement was reached for the return of Hong Kong to Chinese sovereignty, as a Special Administrative Region. Towards the beginning of 1990, the awareness of the importance of participating in technology development was sufficiently heightened for the people of Hong Kong. A technology roadmap was produced and published as a book in 1991. It is interesting to note that the year 1991 roadmap, if implemented at that time, could have given a significantly advantageous technological position for Hong Kong as we enter the twenty first century. But, it is never too late to start in the year 2000. Hong Kong has a better financial position now, after nearly a decade of successful economic growth, to make the necessary investment for its entry as a technology participant a success.
Hong Kong was a trading port undertaking entrepot business before and when the People’s Republic of China was established in 1949. From that point till 1983, the border between Hong Kong and China was a line of practical separation. Hong Kong found its entrepot role curtailed. Much of the trade and commerce had to be redirected. With the injection of capital from the people migrated into Hong Kong from the mainland prior to the closing of the border, a number of manufacturing businesses began operation. The most dominant one was the textile industry. Other industries, large and small, sprung into existence. Hong Kong became a manufacturing center.
After the visit of President Nixon to China, the entrepot role of Hong Kong for trade and commerce between China and the rest of the world slowly returned. Trading between Hong Kong and the mainland also increased. The availability of low cost labor in the neighboring area to Hong Kong stimulated investment, from Hong Kong into China, to establish manufacturing facilities. Gradually, the border was opening.
The Sino-British negotiation for the return of sovereignty to China came initially as a shock to the people of Hong Kong. The immediate aftermath was a loss of long term confidence by the people of Hong Kong. The British Government declared that it was not abandoning the people of Hong Kong and leaving them without any protection. It would negotiate with China a deal that would allow Hong Kong to operate without change, of its then current status, for 50 years for the people of Hong Kong. In 1983 when the principle of one country two systems with a basic law for Hong Kong (prepared with direct Hong Kong participation), was agreed, the fear was allayed largely for the people of Hong Kong. Nevertheless, many people migrated to other countries around the world
seeking the right of abode in the countries of their choice. For a while the exodus
seriously depleted talents available in Hong Kong.
The 1991 Technology Roadmap
After 1983, it was the period when the Hong Kong Government under British
stjurisdiction attempted to deliver Hong Kong as a jewel to China on July 1 1997. The
Tiananmun incident did shake the confidence of the people of Hong Kong. The British Government introduced a scheme to allow some Hong Kong people to have British Citizenship with the right of abode in UK, and started an effort to substantially improve Hong Kong’s infrastructure, so that Hong Kong will be a viable world city to compete with possibly even London and New York. These actions were taken as a means to shore up people’s confidence, and as a way to maintain the prosperity of Hong Kong, an action welcomed both by Hong Kong, Britain and even China. Before the actual date for Hong Kong’s return of sovereignty to China, with a number of years’ of stability and with
increased opening of China, most people, by then, made their plan to stay in Hong Kong. During this period the real estate business was booming. The industrial sector moved, in earnest, their production capacity to the neighboring regions in the Pearl River Delta. The neighbor town, Shenzhen, became a satellite industrial town of Hong Kong. The size of the labor force increased over this period to several million. The labor force came from all parts of China. Hong Kong became a service centered city providing both consumer and producer services.
The Government continued to hold advisory committee meetings such as ITDC, Industrial Technology Development Council, where Government, industry and Academia people, in their personal capacity, gave advice to the Government on industrial and technology issues. The sub-committees of ITDC covered all the important industrial sectors. Through these committees, consultants were invited to review the position of the industrial sectors and to provide strategic decisions. One overall sub-committee named
TRB, Technology Review Board, undertook an overall review process. The 1991 Hong Kong Technology Roadmap (Ref. 1) was one of the products of this Board. A summary of the Report is presented here together with a selected extract on Information Technology.
Summary of the 1991 Roadmap Report
An in-depth investigation into four technology areas with particular potentials for Hong Kong was undertaken. These technology areas were:
Since the nature of these technologies and Hong Kong's position in each were very different, the four Parts were handled separately and in formats appropriate to each. The common emphasis running through the presentation of all the technology areas was the use of specific illustrative examples to focus the analysis. For each technology area and with particular reference to the examples, the then current research and development (R&D) status in Hong Kong was given, together with an assessment of the additional R&D required to bring products to commercial viability. The comparative advantages of Hong Kong were emphasized, since these advantages provided the main justification for commercial development in the face of worldwide competition. This method of analysis permitted an in-depth discussion leading to firm conclusions, and avoided the pitfall of vagueness and over-generalization that would be inevitable in any attempt at completeness. However, the materials technology section presented a more generic
discussion, necessitated by the more fragmented nature of that technology sector in Hong Kong.
The strength of the economy of Hong Kong lay principally in the financial and trading sectors, while the sector characterized by advanced technological development and innovation had yet to emerge as a mainstream of the local industry. It was the goal of this study to provide illustrations of some promising processes and their necessary supporting structure that could assist the growth of this important industrial sector. The roadmap concept was adopted to allow the readers, as it were, to walk from the present situation to the target technological opportunities, with an awareness of the R&D investment issues involved. Through this study, the messages to the investment community and to the entrepreneurial industrialists were clear: namely, (1) opportunities were available for developing new technology-based industries in Hong Kong, and, (2) the tertiary education sector was ready to deliver technical assistance in a variety of ways.
In the metaphor of a road map, the study considered both the starting point (the present technological and infrastructural strengths and weaknesses of Hong Kong, as well as assessments of the global scene and market), the destination (represented by the potential business opportunities) and the road to get there including the toll costs (represented by R&D and other investments). It was up to entrepreneurs to make their own choices based on estimates of cost, risk and benefit. An illustrative technology road map in pictorial form is shown in Ref. 2.
Extract from 1991 Report - I : Analysis of the Impact of Information Technology
A narration extracted from the 1991 Roadmap showed the impact of technology on the Information Industry in 1991.
Traditionally, equipment makers in the telecommunications industry worked closely with the carrier network operators in anticipation of the service demands of the customers. They designed and manufactured customer premise, system and network equipment. Vast investments were made in technology R&D with the aim of extending the capabilities of the network for delivery of telephone related services at better quality and lower cost. This healthy and productive marriage between the equipment makers and the network operators benefited the customers well.
Recent developments in the provision of information services had been pushed by advances in technology and pulled by the rising importance of information flow for business and for entertainment. As a result, a broad range of new businesses were created. Private networks were built to compete with the public carriers. CATV networks were constructed for the explicit purpose of distributing television program to customers through cables. With the extensive use of optical fiber cables in all the networks, the distinction between these networks was disappearing. New services could proliferate and could be introduced in any of these networks.
The equipment makers faced a new competitive environment, with networks provided by a multiplicity of players in an increasingly deregulated environment. Technological advances increased design versatility and adaptability to the extent that equipment interconnectivity was the key to success.
Common carriers operated in a regulated environment. They were obliged to connect all customers, however remote, to the telecommunications network. The customers could connect approved equipment such as telephones, computers and fax machines to the network. The calls were charged by the carrier operators by time, distance and bandwidth at a rate approved by the regulatory commission. The approval was given based on justifiable capital and operation costs, and on an acceptable profit margin.
The common carrier operators strove to satisfy all customer demands at a low charge per call, with little or no waiting time, and with many convenient call features. This was achieved by working with the equipment suppliers to improve call features and to reduce cost per call through technological improvements.
The monopoly status of the common carriers gradually was eroded through deregulation in most developed countries. First, by-pass networks were permitted to either lease lines from the common carriers or to construct their own networks and connect selective customers, mainly corporate users, at a lower rate per call-minute along a given route. Second, alternative cellular radio networks offering switched connections for telephone and paging services were permitted to operate as independent competing entities. Third, value-added services were introduced as deregulated services on any network.
The role of the common carrier network operators was forcibly changed. They operated on a dual role, that of network providers and that of a service provider offering certain network features and value-added services. They had to prepare for the gradual but