Newsmaker: Tech, drugs and the wealth of nations

Cadence Design Systems executive Ray Bingham has a prescription for the U.S. electronics industry as it faces growing competition from abroad: Do what European drug and chemical companies have done.

Bingham, executive chairman of the chip-design software company, argues that Swiss and German companies have managed to remain dominant in the pharmaceutical and chemical fields by learning to "straddle and harness" global markets.

"If you look at the influence in relative ownership and wealth creation within those industries, you still find a disproportionate amount of it flowing back to Switzerland and Germany," Bingham said. "You still see significant research being done there, but over time it goes to where it needs to go from a talent, cost and market point of view. The same exact thing is happening in the electronics industry right now."

Bingham is the latest voice weighing in on a growing debate over how the United States can maintain its technological leadership in an age of offshore outsourcing and as developing countries such as China and India ramp up their abilities.

San Jose, Calif.-based Cadence is busy trying to harness those emerging powers. The 4,700-person company has its largest research-and-development operation in San Jose, but it has 700 research and development employees in India and another 100 in China.

CNET News.com recently spoke to Bingham about matters including R&D spending, China's advances in the semiconductor field, and how the United States can remain a top player in electronics.

Q: Where do you have R&D operations outside the United States?
Bingham: Our first efforts were in Japan and Taiwan, though they've never gotten very large. We followed on that with a fairly significant site in Sophia Antipolis in the south of France and one in Scotland and, of course, in the United Kingdom. So those have been the traditional sites we've had in place for a long time.

We also about 10 years ago started developing an R&D activity in India. We...have grown that steadily over the past 12 years to its present size of about 700 R&D people. It is in a site located just outside of Delhi.

How does that compare with your other R&D sites? Is that the biggest one you have now?
Bingham: Oh no, no. Our largest one by far is here, in San Jose.

How many people are there?
Bingham: We have 912. We have maybe 250 in the Boston area. We have on the order of 100 in North Carolina, and we probably have another 100 or 150 in Austin. There are some other small

More Newsmakers