GOVERNMENT PROJECT SUPPORTING THE DEVELOPMENT OF COMPUTER TECHNOLOGY

The computer industry expanded rapidly in Taiwan in the 1980s. However, computer products were low value-added and the technology was relatively basic. The upgrading of computer technology in terms of manufacturing was necessary to ensure high value- added and high intensive technology. The structure of the local industry was based on SMEs. Both the technology and R&D capabilities were insufficient. In particular, investment in long term R&D was subject to lack of skill and capital. The development of computer products always lagged behind that of foreign companies. Therefore, Taiwanese businesses were always controlled by foreign companies and local companies were asked to pay technological royalties or licence fees. Thus, competitiveness was lowered.

In order to reduce manufacturing costs and raise quality, a four year Special Technology Project (STP)-- the Development of Packaging Technology for Computer Products (Packaging STP), was introduced by the MOEA in July 1990. Packaging technology was aimed at developing the critical technology for precision mechanical processing and electro-mechanical integration which could be used in the process of high-intensive physical design and mechanism structures for the miniaturisation of electric and computer products. The total budget was nearly NTS500 million in a four

year span. With reference to the development of NPC. the first year plan with a budget of NTS116 million emphasised the technology for the application to manufacturing of Might, thin, short, and small' electrical products4". Three main programmes and eight sub-programmes were developed in order to solve the problems in the pre-competitive and mass production stage. In terms of physical design, the designer applied a computerised analysis instrument to assist the design of electrical board and systematic structures so as to prove their testability and ability to produce a satisfactory product. This approach matches the demands of high tech production and shortens the time of development. In terms of manufacturing, the plan was intended to enhance product quality and to reduce the cost of mass production. The core of Packaging STP was, to a certain extent, to develop the technology needed for miniaturisation in the first year (Interview No. 30).

However, the coverage of high-intensive physical design and the technology of manufacturing engineering relative to packaging technology involved many specific fields such as modules analysis, physics, chemistry, material, engineering, electrics, and automated control, which were far more complex than the private sector can tackle because the R&D teams in the private sector were relatively small. Therefore, the use of government power of planning and financing an STP to develop an overall packaging technology as a contribution to the electrical and computer industries, was expected and effected.

ITRI is the institute for implementing the Packaging STP. The CCL of ITRI is the leading R&D unit conducting R&D in conjunction with the coordination of the Electronics Research and Service Organisation (ERSO) and the Materials Research Laboratories (MRL).

The total manpower and capital input in this STP was 76 persons and NTS116 40

40 The discussion o f the 4-year computer packaging technology STP is stressod on the first year plan because that the NPC consortium derived its technological application mainly from the result of the first year of this project.

million in 1990. The research team is larger than that of anv private enterprise in Taiwan. Some local companies (Acer and Mitac) had larger research teams than those of SMEs, however, they were 'big' in Taiwan but not by international standards or in comparison with those of 1TRI. In addition, researchers were from different backgrounds o f technology, for example, ERSO, CCL and MRL, so that the coverage of R&D ability was also stronger than that of the private sector. The large amount of government investment also exceeded the ability of any local companies. The financial input of Packaging STP from the government in 1990 alone was twice the fund of the NPC Alliance paid by 46 private participating firms.

Nonetheless, the significance of Packaging STP as a government contribution was not so much the vast manpower and capital investment, but rather the fruits of its R&D which were directly applied to the development of NPC and eventually applied to the computer industry. If the resource inputs did not lead to promising technological outputs, all investment would be in vain. According to Mr. Chen (Interview No.6), a technology advisor to DIT, it is not necessary for every government technological project to lead to a commercially viable product because the success of a technological project can not be judged in market terms alone. In Taiwan, however, six or seven out of ten cases could be deemed successful in government STPs. In his view, it is very unusual to have such a high rate of success since the R&D investment can be repaid if one in ten cases were successfully commercialised.

As far as the DIT/MOEA is concerned, the review criteria of technology development plan is the combination of industrial policy and industrial demands in future 2-4 years which emphasises a market-oriented project leading to the development of technology or a product with a potential market niche. Accordingly, Packaging STP is a success.