Where will the Silicon Dragon swoop next?

China has already made its presence felt on the world technology stage. But how much further can the country go? Sino-tech expert Rebecca Fannin gives Steve Ranger the inside track.

Rebecca Fannin has travelled across China to investigate the country's high tech boom and talk to the entrepreneurs leading it. The country has the fastest growing venture capital market in the world and is rapidly growing into a tech titan to rival the established hotspots. Fannin's book Silicon Dragon: How China is winning the tech race interviews 12 top Chinese tech bosses and their investors.

Tech Hotspots: The list

1. Silicon Valley
2. Bangalore
3. London
4. Tokyo
5. Boston
6. Cambridge
7. Shanghai
8. Tel Aviv
9. Seoul
10.Beijing
11.Chennai
12.Pune
13.Singapore
14.Helsinki
15.Moscow
16.Hong Kong
17.Hyderabad
18.New York
19.Sydney
20.Shenzhen

The Chinese tech boom
I think it has to do with the large market opportunity and the number of mobile phone users. It has the world's largest number of mobile phone users and the largest number of internet users and people are very switched on and tech-savvy - and so it's a huge market and there's a lot of money that's been invested in this area.

Innovation hotspots
There's lots surrounding wireless communications and some digital TV standards and a new phone standard - China has its own phone standard for 3G. And then there are biotech developments and clean tech developments and developments in areas in the semiconductor area and LEDs and gaming - so it's a pretty broad range.

On China catching up with Silicon Valley
I'd say it's at least a decade and a half away. The legal infrastructure needs to be developed and the financial infrastructure and issues like intellectual property protection. These kinds of issues are progressing in China but are not resolved. You have the lack of qualified talent in some cases, particularly management talent. So you can have some great engineering skills but management talent is another thing.

And why it's happening
One of the things is that the Chinese government is going to have a Nasdaq-type exchange for listings, so that will help propel things quite a lot. There are changes in the education system away from rote memorisation to more creative ways of teaching.

Where to find the innovation in China
There are tech hubs. There's one in Beijing and Shanghai has its own tech zone. I'm also increasingly hearing about innovation in other cities such as Chengdu and Hangzhou, for example. Alibaba.com is from Hangzhou. I've heard of other start-ups setting up there, so innovation is spreading out from the major cities.

How China compares with India
India made its name in software outsourcing. China's tech boom is broader. Just look at the number of Chinese companies that have listed publicly in the past five years - it's well over 75 and they're doing well too. Many of them have been valued at as much as $10bn.

Today I'm seeing home-grown entrepreneurs who have been educated in China, who have their experience in China, and who are developing products for the Chinese market that are very advanced, even advanced by Western standards. Lenovo and Huawei are examples of Chinese tech companies with global impact and Baidu - the search engine company - has already entered the Japanese market, and Alibaba is a global company with its services in many different languages.

Why should CIOs visit China?
It's worth going there and seeing what's going on, particularly in the wireless and the internet and web 2.0 space. It's really pretty advanced. Right now it's really bubbling up to the surface. It's an emerging trend - it's not very well recognised or documented or covered.