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Chengdu dreaming

By Cong Mu  (Global Times)

08:46, June 04, 2013

From startup partners to the general managers of Fortune 500 companies, high-tech industry entrepreneurs are investing their hopes and dreams in Chengdu, capital of Southwest China's Sichuan Province.

Zeng Xianru, 32, came from Beijing to join his friend Li Yanchuan's mobile Internet startup Aruba Co, based out of the Chengdu Tianfu Software Park in February.

Hailing from a small county in Gansu Province, Zeng, now a senior vice president at Aruba, says, "I want to make a better life for my parents, myself and my future child."

"In Beijing, raising a child to 18 years old may cost 2 million yuan ($330,000), and I don't have that much money. So what can I do? I have to struggle," Zeng said.

Disillusioned from climbing the corporate ladder in Beijing and Shanghai, Zeng ventured into the "Silicon Valley of western China" to develop cellphone games, a new industry in China that he hopes can make him a rich man.

Chengdu is an ideal incubator for mobile gaming, due to not only its low costs but also its practical mindset and complete software supply chain, said Li, Aruba's CEO.

While entrepreneurs in Beijing and New York often talk about media, fashion and finance, the innovators in Chengdu talk mostly of technology and real creation, rather than building up hype, said Li.

Chengdu has already nurtured highly profitable startups as the world-class mobile game champion Tap4Fun and PinGuo Tech, whose photo processing application Camera360 has over 70 million users worldwide.

Supply chain upgrading

Seeing software companies benefiting from a comprehensive supply chain in Chengdu, Bian Chenggang, general manager of Intel Products (Chengdu), a unit of the world's largest chipmaker Intel Corp, seeks to help build a well-round ICT manufacturing ecosystem in the city.

"Since I joined Intel more than 15 years ago, I've had dreamed of building a world-class Chinese team capable of global competition, and I've been working toward that goal since I came to Chengdu about four years ago," Bian, who is also Intel's vice president of Technology & Manufacturing Group, told the Global Times in its modern factory in Chengdu on May 21.

Bian is glad that in 2012, the Chengdu factory received the Intel Quality Award, the highest recognition the US high-tech giant doles out every year to a select few of its organizations in the world.

Since its operations in 2005, Intel's Chengdu plant has assembled and tested 1.3 billion units of microchips, its annual production now accounts for half of the world's laptop chips, and it creates 3,000 local jobs, in addition to another 1,500 jobs from various suppliers on site.

Intel is now a star company in Chengdu, and Bian, from Shanghai, was named an honorable citizen of Chengdu in 2010.

These achievements have made Bian even more confident of his dream of building a top ICT manufacturer in the world in Chengdu.

Bian said his target over the next three years is to help upgrade the local supply chain in a bid to create an ICT industrial ecosystem that can become sustainable and world-famous.

Demonstration effect

Intel's accumulated investment in Chengdu over the past 10 years has reached $600 million, and has helped drive more investments into the city by major global laptop makers such as Foxconn Technology Group, Dell Inc and Lenovo, according to a report jointly released by Intel China, the Sichuan Academy of Social Sciences and the Association of Enterprises with Foreign Investment in Chengdu on May 23.

By the end of 2012, nearly 50 Fortune 500 IT firms had invested in Chengdu, beating out central and western China, according to the report.

"The strategic decision by the Chinese government to make Chengdu an economic vantage point has made it possible for the local IT industry to grow even bigger and stronger … (The industry) will become a leader and driver of Chengdu's dreams," as well as its industrial transition and upgrade, Ge Jun, managing director at Intel China, told a forum in Chengdu on May 23.

Main business revenues from the IT industry (both software and manufacturing) in Chengdu increased by more than 19 times to 377.7 billion yuan in 2012 from 18 billion yuan in 2001, the report said.

The industry's contribution to the city's GDP in 2012 reached 13.7 percent, the report said.

The success of Intel and other IT companies in Chengdu reflects the decision by the Chengdu government to be "open to and cooperative with" foreign investments in a globalized economy, Wang Zhile, a researcher at the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, told the Global Time on the sidelines of the forum.

Talent pooling

The Tianfu Software Park, where Aruba is located, is a symbol of such openness and cooperation.

Unlike crammed office buildings in Beijing, the government-run software park that houses nearly 1,000 certified IT enterprises is designed to give off a transparent, campus vibe and provide large common space for technicians to communicate.

"In Beijing, different companies don't talk to each other freely because of the high investments at stake. Here, I can easily walk into my neighbor's office and chat with their boss," Li said, noting that the cost of operation in Chengdu is less than 20 percent of that in Beijing, thanks in part to local government subsidies.

In addition, "the Tianfu Software Park is the park I know in China that really serves the startups," Zeng said.

In 2012, the park's managers assisted companies within the park "to attract over 2,500 experienced professionals from first-tier cities to Chengdu via its recruitment activities," the park's administrative committee said in a recent report.

"The number of experienced professionals migrating to Chengdu will continue to increase," Victor Jansson, the park's vice president, said in the report.

It forecast that the number of certified software firms in Chengdu would rise to 1,500 in 2015 from 948 in 2011.

Compared with megacities, Chengdu has some advantages, such as affordable housing prices, in retaining experienced talents, Bian said.

He gave an example of how some envious engineers in tier-1 cities like Shanghai and Beijing compare the quality of life with their classmates from schools in Chengdu, who have already bought apartments and decent cars as well as formed families.

"The city must keep these advantages (to be competitive)," Bian noted.

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