When it comes to technology hubs in China, few people think of Sichuan as a major source of development and innovation. But for anxious developers out there looking for some new talent and market potential, start paying attention to Chengdu.
According to an article released last week in China’s “Business Value” magazine, there are some significant advantages to operating in Chengdu. Though the article is largely an advertisement for the city and for investment, it makes a few fair observations.
For starters, many tech firms have offices there, including Lenovo and Tencent. Furthermore, there are a variety of developers already for many mobile applications. Eight of AppStore’s Top 100 developers in terms of income came from Chengdu. One example is Tap4Fun (尼毕鲁), one of China’s most popular game developers, which had a total income of $1.13 million according to the rankings.
Chengdu has been investing heavily in software development, and given its status as an in-land second-tier city, there are a variety of opportunities there in terms of talent and labor. Chengdu’s South Third Ring Road is home to the “Tianfu Software Park,” where many of these companies are located. Since 2005, Tianfu Software Park has expanded drastically. Zero2IPO CEO Gavin Ni estimates that Chengdu will become the fourth largest venture capital target in China in the next 10 years after Beijing, Shanghai and Shenzhen. Apparently since the financial crisis, many companies have moved their research and development to Chengdu because of its lower overhead.The city is described as a “low-pressure, low-cost, and high quality environment.”
Indeed, second-tier cities (the term for cities that are second to the rich industrial seaports on China’s coasts) are becoming increasingly popular for many companies, as labor prices rise in the traditional export hubs of Tianjin, Shanghai, and Shenzhen. The appeal of some newer space and real estate is becoming hard to ignore. Landlocked Wuhan, for instance, was the recent site of Lenovo’s groundbraking of its latest production base.
Update: It has been clarified that Baidu does not have an office in Chengdu as previously reported. Only one of its resellers has an office.