The shrinking of the tech sector threatens creativity and new thinking

By Christopher Lochhead, strategy advisor and former chief marketing officer, Mercury Interactive

Is Silicon Valley at risk of becoming Detroit 2.0 — a company town dominated by a handful of big, uninspired conglomerates?

Lochhead advocates a mix of innovation and consolidation

Consolidation is replacing innovation as the hot strategy. During his company's battle for PeopleSoft, Oracle CEO Larry Ellison declared that the software industry has entered  a "period of contraction and consolidation."  

Talk about a self-fulfilling prophesy: Oracle has gobbled up at least a dozen more companies since it closed the PeopleSoft deal in 2005, and a big purchase of Sun Microsystems is pending. And other companies widely are expected to follow Oracle's acquisitive ways.

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Anthropologist Genevieve Bell helps Intel understand what people around the world are doing with technology – and what they'll want to do next. Photo: Intel

While traveling in China, Genevieve Bell figured she'd have no trouble getting a cell phone. With cash, a passport and official documents from her employer, she went to a local shop where phone packages lined the walls, and asked for one.

I don't have any, the shopkeeper said.

She noted that she could see boxes of them all over the store.

They're bad phones, he said.

I'm only here three weeks, she confided; it can be a terrible phone. But he still wouldn't sell her one. "It was like a really bad Monty Python routine," she recalls.

The problem, it turns out, wasn't the phones — it was the phone numbers. Numbers carry symbolic significance in China (8 and 3 are good, 7 is awful) — and when this particular shopkeeper had run out of good numbers to match with phones earlier in the day, he stopped selling phones altogether. Come back tomorrow at 9 a.m., he said, and I'll sell you a phone with a suitable number.

The encounter illustrates how technology and culture blend in new ways in a global society powered by cell phones and PCs. It also serves as an example of why Intel (INTC), a company known for employing computer scientists, employs Bell, an anthropologist.

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We're live blogging from the Town Hall at Apple's (AAPL) Cupertino campus today as the company shows off new laptops. Refresh the page for updates.

The event has begun. Steve Jobs comes out (he looks pretty good), and says we're here to talk notebooks. He says we'll first go over the state of the Mac, and Tim Cook, Apple's Chief Operating Officer, comes out to do that. More

Apple's lineup of MacBooks is getting an update on October 14. Photo: Apple

You've probably heard the story of two guys walking in the woods who accidentally startle a hungry bear. As the bear turns to them, one laces up his running shoes. "Why bother? " his friend says. "There's no way we can outrun that bear." With a wink, the man replies, "I don't have to outrun the bear. I just have to outrun you."

Ahead of what's almost certain to be a dismal holiday season, this story takes on special meaning for Apple (AAPL). The bear market is poised to maul PC sales during the most important time of year, when about half of all annual sales happen. Investors clearly expect things to get ugly -– before Monday's market rally, they had slashed Apple's market value to half its year-ago level on fears that the credit crisis will ruin Apple's Christmas.

But here's the thing investors may be missing: Apple doesn't have to outrun a bear market. It just has to outrun PC makers like Hewlett-Packard (HPQ) and Dell (DELL). And with a new line of laptops set to debut Tuesday, CEO Steve Jobs will argue that he's already lacing up his running shoes. More