Officials in Taiwan make no secret about turning the island into a hub for artificial intelligence R&D. It’s an area that’s expected to grow into a $390.9 billion market by 2025, according to Grand View Research.
Taiwan has been the world’s hardware hub for decades, so the shift toward AI makes the most of the existing inexpensive engineering talent. A refocus on AI, however, reduces reliance on hardware, which can easily be made somewhere else, such as China, at lower costs. Multinational tech companies have already shown interest in tapping Taiwan’s talent in software, including AI.
To move things along further, the government of Hsinchu County, near Taipei, will open a 126,000-square-meter (about 1.3 million square feet) AI business park near one of Taiwan’s major all-purpose high-tech zones and two top universities.
“[The park] will not just help [promote] industry-academia cooperation, but also let AI-oriented startups and companies have a demo space to verify AI product services,” says Shirley Tsai, a research manager with IDC Taiwan’s enterprise solution group. “It will be helpful as well to attract the companies who are interested in the AI field and then accelerating the AI ecosystem.”
Demand for more AI talent, Taiwan has the supply
Tech giants such as Google, IBM and Microsoft have expressed intentions of developing AI R&D centers or similar initiatives in Taiwan. They picked Taiwan over other markets in Asia because capable and cheaper engineers are abundant. Workers in Taiwan are also considered less likely than peers in mainland China to steal patented technology. To help meet this demand, Taiwan’s cabinet last year announced plans to train 10,000 AI workers per year.
The AI business park, Hsinchu County International AI Smart Business Park, broke ground last month. The tract will support a secondary school, an international conference center and a “demonstration and experience center,” according to official records. There are also plans for an incubation center and workspace for startups. The official records indicate two-thirds of the total space will be set aside for companies doing AI. Basic infrastructure is due to be completed by year’s end.
County officials declined to comment on the number of companies the park would accommodate.
The AI park should thrive thanks to the encouragement from the Taiwanese government and “cross-industries cooperation,” IDC Taiwan’s Tsai says. It might ultimately help Taiwan establish clusters for specific kinds of technology, a way to place talent, capital and the supply chain in close proximity to make business more efficient.
The Hsinchu Science Park, a 40-year-old zone run by the Taiwanese government’s Ministry of Science and Technology, is the role model. It has more than 520 approved companies, including the semiconductor giant TSMC, employing a total of 150,000 people.
The AI park will make an impact and sustain itself if it can create a critical mass of production based on a tight supply chain, says Tracy Tsai, a research vice president in Taipei with market research firm Gartner. Otherwise, she says, AI companies can work just as well in other business parks without an AI theme. “When there’s enough output, then you have a substantive meaning,” she says.