The global high tech industry is undergoing fundamental changes, driven by
the emergence of a new technology platform for growth and innovation. Built on
smartphones, tablets and other connected devices, mobile broadband networks,
cloud services, Big Data, social media, and a range of other technologies, the
new model of computing is expected to revolutionize the ICT industry. Despite
global economic uncertainty due to the expanding European debt crisis and
concerns over U.S. economic growth, the pace of technological change appears
unrelenting, creating substantial new opportunities both for the ICT industry
and for the industries it serves.
One of the key characteristics of the emerging computing platform is that it
enables the introduction of advanced technologies into new areas, which
traditionally have fallen behind the technology curve. As technology seeps into
more and more aspects of our everyday lives and becomes accessible for an
expanding range of usages, innovation is increasingly required across all
industries in order to keep up with rapidly changing environments.
Technology innovation has been the cornerstone of the success of the Israeli
hightech industry over the last decades. Today, Israeli companies are playing a
key role inshaping the new computing model, and across all layers of the
technology stack - from the chip level all the way up to the application.
Building on the legacy of companies that pioneered new technologies and became
industry leaders in various fields, Israeli high-tech companies continue to
The numbers are instructive: Approximately sixty Israeli companies are
currently traded on NASDAQ, one of the largest numbers of companies listed for
non-U.S. countries. Israel has consistently been a leader in categories such as
expenditure on R&D as a percentage of GDP, percentage of engineers among
residents, and others. Israeli start-up companies continue to raise significant
amounts of funding from local and global investors. In fact, Israel is leading
the world in terms of per capita VC investment, and is second only to the U.S.
in terms of number of start-ups.
Israel's established excellence in technology development has been recognized
by the global industry. Many of the leading international high-tech companies
have established R&D activities in Israel. Intel, Microsoft, Cisco, IBM, and
others have located their first development centers outside the U.S. in Israel.
In addition, following its acquisition of Israeli flash memory chip designer
Anobit, Apple has recently established its first hardware R&D facility
outside the U.S. in Israel. These companies and many others continue to develop
major product lines in their Israeli facilities. Furthermore, many Israeli
executives are currently serving in management positions at international
In many cases, major international technology vendors started their local
R&D activity following the acquisition of Israel firms. Hundreds of Israeli
companies have been acquired over the last decade. In parallel with the global
market, after experiencing a significant decrease in M&A activity due to the
global economic crisis in 2009-2010, there has been a renewed surge in
acquisitions of Israeli ICT companies in the last 1-2 years. In 2011, 83 Israeli
ICT companies were acquired for a total disclosed value of more than $5 billion.
This trend has continued into 2012, as approximately 40 Israeli ICT companies
were acquired in the first half of the year for a total disclosed value of more
than $3.5 billion (not including Cisco's $5 billion acquisition of NDS,
originally an Israeli start-up company).
Full report (pdf)