DOST ₱1 Billion, Phildev ₱5 billion Philippine PC Tablet Manufacturing for $100 each

"I look forward to the day when there's no longer imported PC (in the Philippines)." – Dado Banatao at the Gonegosyo Technopreneurship Summit. (Go Negosyo photo)

Very impressive and ambitious plan which been started the fund raising for the first Philippine design personal computer and pc tablet manufacturing initiated  Philippine Development Foundation (Phildev).

Reported at the Manila Bulletin (Friday) Philippines Can Supply PC Requirements would mean that the Philippines would stop relying on imported computers from china's low quality pc and would make the Philippines as a global supplier for affordable but good quality computers.

Manila Bulletin: With a skilled workforce capable of doing difficult chip design, this seemingly far-fetched vision is not impossible as the Philippine Development Foundation (Phildev) has already started planning this.

The Philippines should one day supply 100 percent of its own PC (personal computer) needs instead of shipping these in from South Korea, Taiwan, or China, according Silicon Valley-based technology entrepreneur Diosdado Banatao.

With a skilled workforce capable of doing difficult chip design, this seemingly far-fetched vision is not impossible as the Philippine Development Foundation (Phildev) has already started planning this.

Phildev is raising ₱5 billion from the private sector for this megaproject of which more than ₱500 million has already been raised.

"This (tablet computers) is a project we started last year. The tablet computer is just one component," said Banatao in an interview at the sidelines of the Go Negosyo Technopreneurship Summit.

"I look forward to the day when there's no longer imported PC because we're designing one. We have to gain confidence in developing products that are very viable. That's how developed countries did it, and we're buying their products"

The tablet computers are envisioned to be distributed to public schools at a very cheap cost at perhaps around $100 per unit. Software will be developed with the Department of Education and Department of Science and Technology. Government is reported to have also allocated around ₱1 billion for the project, but cost may be much more considering infrastructure requirement.

"By the time we're done deploying this, it will be a lot of money. The tablet is just one component of the project, there's infrastructure. Communication, long distance wifi, tablet, network – this whole thing will be needed by the Philippines," he said.

The Philippines must access the global market if it has to grow in technology ventures and bring a lot more wealth, said Banatao who founded Silicon Valley startups Mostron, Chips and Technologies, and S3 Graphics through which their IC design .

Investments should be made to become competitive in technology equipment, including PCs, in three parameters — performance, power consumption, and cost.

"In your smartphone, you'll see a bunch of chips. I've been kind of curious how many dollars were invested in making those work — with those three parameters. Roughly $3 billion were invested to make that smartphone work," said Banatao who design and manage design of chips that are now found in PCs and other electronic equipment.

There should be a complete intermarriage between business and science where workers have strong grasp on basic disciplines-- primarily math and science. The education system should be reformed for this.

"It is disappointing some schools are being guided more by business than learning. If some schools understand what parents go through to send their kids to school, they will put more content in the kids' minds because the parents pay for it."

Intensive technical education is inevitable if the country has to take off economically

"What we do at Phildev is we're working with government to attack this (commercialized education). If you look at the curriculum, and there's no depth in science, you should worry you're not getting the return for your money," he said, stressing it's through technology that Japan and Germany arose from destruction in previous wars.

"Japan became the number two economy within less than 20 years after World War II because they're deep in technology."

In Silicon Valley, where there are no unions because enterprises pay for brains and hardwork, technology innovators dig inspirations from the basics, according to Banatao.

"When I was at Mapua, we always had a set of problems at the back of each chapter. I solved all the problems in the book, whether Physics, Math. I did this twice – once before the test and another before the finals. I know that's severe, but that's me. Somehow I thought there should not be problem I can't solve.

That shows excellence one can strive for," he said.

"I brought that practice to Stanford where I was competing with top one percent of students in the world."

Banatao's Tallwood Venture Capital, a startup funder, has more than $600 million in investment portfolio in technology enterprises. Tallwood has a local affiliate investing here, Narra Venture Capital represented by Dr. Paco Sandejas.

"The biggest companies in Silicon Valley grew because they're practicing entreprenereurs grounded in deep technology. There are no compromises in wanting to use or acquire that knowledge," he said.

The wifi technology is also continuing to evolve — so that Silicon Valley companies are doubling capacity of data transmission.

"We're continuing to put a lot more money for wifi. It's just a matter of time, and (the technology) is potentially violating Shannon law. Probably we'll spend about half a billion dollar. You'll see that it's impact on people's lives is amazing," he said.

The challenge to practice expertise in a technology craft should drive many to entrepreneurship.

"There's no job here that can really challenge me, so I left for the US. That confidence will allow you to become an entrepreneur. It's not easy to become an entrepreneur especially when you deal with technology. Chances are you will fail in nine out of 10."

Among the success factors to technology entrepreneurship are a compelling need — if someone has long been looking for this product for a long time until one's product comes; execution — a cohesive plan for the first year, second year and so on; and a strong technical and management team. This team is pertinent in bringing in the funding as this team's payroll would also require a significant amount while the company is still struggling to survive .

The creation of a market for a technology startup is really a painstaking effort. It can take five to 10 years to create a market. On the other hand, an existing market for an existing product would give an entrepreneur readily-available data on the market.

"You think you can create a market. But I advise startups 'Don't do that. It can take five to 10 years to create a market. The nice thing with the market if it's an existing market is it has a lot of data. Market research is crucial. It's easier to develop a product based on existing markets with identifiable needs."

There may be successful technology entrepreneurial successes like that of Facebook's Mark Zuckerberg.

But most of the time it takes more years to create a market, Banatao said. It took Bill Gates, for one, 15 years to develop the PC, and it took Michael Dell, Dell Inc. founder who is now $14 billion worth, some time too in developing direct marketing for the PC.

One has to offer something really good amid competition.

"There is something positive and negative in any market. There are a lot of players you can compete against. If you bring in something good to that market, you have markets right away. But with strong competition, you have to be that much better. It's hard."

"The key thing is in identifying a need. It has to be very compelling – a way to gauge that is if someone says 'This is what I've been looking for — that's a definition of compelling. No one has addressed that need."

Venture capitalists should be present to finance startups even while it is yet to achieve profitable operation.

"You either commit to be that good, or you get out. It's a relentless effort, and that's where the investors come in. They have to continue to support you if you need more money because its relentless."

Planning is important in ensuring that one's product does not go obsolete.

"I want a situation where I make my own product obsolete."

Monitoring of key results in a technology enterprise is a constant challenge.

At Tallwood Ventures, the key results and targets are right in front of each staff, Banatao said. Each staff has to come up with weekly reports, and part of that report are monthly objectives that came out of the operating plan.

"Every employee should be working on some objectives. It has to be that accurate."

There should be a strategic planning the result of which is a product roadmap. However, when there is a need to change plans, change should be done.

Tallwood invests in the semiconductor and related industries.

Its investment portfolio in technology enterprises includes Accent, offering communication and metering technologies for the Smart Grid industry; Alphion, photonics component manufacturer; Amulaire, engaged in metal injection molding processes; Astute, advanced storage processor company; and Audience, Sandbridge, and Tram, fabless semiconductor firms.

The others are Sirf, developer of silicon and software platform for high-quality digital audio-video; Wave Semi, low power programmable solution provider; Wilocity, gigabit wireless solutions enabler; Stream Machine, MPEG-2 video recording supplier; Silicon Clocks, timing products maker; and Rio, optical transmitter manufacturer. (http://bit.ly/Y63LBF)

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