Footnotes: 1. Taiwan Historical Association (台灣歷史學會), Taiwan ViewPoint: http://www.twhistory.org.tw/20010416.htm 2. The Kuomintang (中國國民黨)abbreviated as KMT and translated as the Chinese Nationalist Party, is a political party of the Republic of China (ROC), located in Taipei, Taiwan. It is currently the majority party in terms of seats in the Legislative Yuan, and the oldest political party in the Republic of China.
Current president Ma Ying-jeou is the seventh KMT member to hold the office of the presidency. Together with the People First Party and Chinese New Party, the KMT forms what is known as the Taiwanese Pan-Blue coalition, which supports eventual reunification with the mainland. However, the KMT has been forced to moderate its stance by advocating for the political and legal status quo of modern Taiwan.
The KMT accepts a One China Principle and defines "One China" to mean the Republic of China and not the People's Republic of China. In order to ease tensions with the People's Republic of China, the KMT endorses the "three noes" policy - no unification, no independence and no use of force. 3. 228 Massacre(二二八大屠殺), formally called 228 Incident, was an anti-KMT government uprising in Taiwan that began on February 27, 1947 and was violently suppressed by the Kuomintang (KMT) government. The number "228" refers to the day the massacre began: February 28, or 02-28. Estimates of the number of deaths vary from ten thousand to thirty thousand or more. The Massacre marked the beginning of the Kuomintang's White Terror period in Taiwan, in which thousands more Taiwanese vanished, were killed, or imprisoned. In 1945, 50 years of Japanese rule ended, and in October the United Nations Relief and Rehabilitation Administration (UNRRA) handed administrative control of Taiwan to the Kuomintang-administered Republic of China (ROC).
Taiwan’s legal status was left undecided to this date. One year plus 4 months of KMT administration led to the widespread impression that the party was plagued by nepotism, corruption, and economic failure. Tensions increased between Taiwanese and the ROC administration. The flashpoint came on February 27, in Taipei when a dispute between a female cigarette vendor and an officer of the Office of Monopoly triggered civil disorder and open rebellion that lasted for days. The uprising was violently put down by the military of the Republic of China. The subject was officially taboo for decades. On the anniversary of the event in 1995, President Lee Teng-hui addressed the subject publicly, a first for a Taiwanese head of state. The event is now openly discussed and commemorated as Peace Memorial Day, and details of the event have become the subject of investigation.
Every February 28, Taiwan's president gathers with other officials to ring a commemorative bell in memory of the victims. The president bows to family members of 2-28 victims and gives each one a certificate officially declaring the family innocent of any crime. Monuments and memorial parks to the victims of 2-28 have been erected in a number of Taiwanese cities, including Kaohsiung, Tainan, Chiayi and Taipei. 4. The White Terror (白色恐怖) describes the suppression of political dissidents and public discussion of the 228 Massacre in Taiwan under the martial law period from May 19, 1949 to July 15, 1987. It takes its root in the anti-Communist White Terror in mainland China and the 228 Massacre 1947.
During the White Terror, around 140,000 Taiwanese were imprisoned or executed for their real or perceived opposition to the Kuomintang (KMT) government led by Chiang Kai-shek, according to a recent report by the Executive Yuan of Taiwan. Most of those prosecuted were labeled by the Kuomintang as "bandit spies" (匪諜), meaning spies for Chinese communists, and punished as such. Among the White Terror's victims were indeed many Taiwanese and mainland Chinese Communist agitators, but with time the White Terror permitted countless abuses. The "White Terror" left many Taiwanese with a deep-seated bitterness towards the Kuomintang, Chiang Kai-shek, and the mainland Chinese. A large number of the White Terror's victims were mainland Chinese who usually owed their evacuation to the island to the KMT, and often having come unaccompanied to Taiwan were considered more disposable than local Taiwanese. Many of the mainland Chinese who survived the White Terror in Taiwan, like Bo Yang and Li Ao moved on to promote Taiwan's democratization and the reform of the Kuomintang. Fear of discussing the White Terror and the 228 Incident gradually decreased with the lifting of martial law in 1987, culminating in the establishment of an official public memorial and an apology by President Lee Teng-hui in 1995. 5.
 Taiwan independence (台灣獨立運動)is a political movement whose goal is primarily to create an independent and sovereign Republic of Taiwan out of the lands currently governed by the Republic of China (ROC) (commonly known as "Taiwan") and claimed by the People's Republic of China (PRC). This movement is supported by the Pan-Green Coalition in Taiwan and opposed by the Pan-Blue Coalition which supports reunification with mainland China at some point. Due to the PRC's claim of sovereignty over Taiwan and repeated threats made by the PRC, Taiwanese have yet to make up their minds to formally declare Taiwan independence for international recognition.
6. Taiwanization (臺灣本土化運動), also known as the Taiwanese localization movement, is a political term used in Taiwan to emphasize the importance of a separate Taiwanese culture rather than to regard Taiwan as solely an appendage of China. This involves the teaching of the history of Taiwan, geography, and culture from a Taiwan-centric perspective, as well as promoting languages locally established in Taiwan, including Taiwanese Hokkien (Taiwanese), Hakka, and aboriginal languages. Originally part of the Taiwan independence movement and related to the Taiwan Name Rectification Campaign, some of Taiwanization's aims are now endorsed by some supporters of Chinese unification on Taiwan.
The localization movement has been expressed in forms such as the use of language or dialect in the broadcast media and entire channels devoted to aboriginal and Hakka affairs. Textbooks have been rewritten by scholars to more prominently emphasize Taiwan. The political compromise that has been reached is to teach both the history of Taiwan and the history of mainland China. Some Taiwanese-owned companies or organizations established in earlier times have names containing the words "China" or "Chinese". They have been encouraged in recent years to change the word "China" in their names to "Taiwan" as an act of Taiwanization. This campaign for changing the names is known as the "Name Rectification Campaign" (正名運動) or "Taiwan Name Rectification".
Many Taiwan-based companies in international sectors already identify themselves as "Taiwan"-based for clarity's sake. This keeps international customers from confusing them with an enterprise based in the People's Republic of China. Other Taiwan-based companies decline to change to a "Taiwanese" name because of expense or the political views held by important clients and company leaders. 7. Henry Liu, often known by his pen name Chiang Nan(江南), was a writer and journalist from Taiwan. He was a vocal critic of the Kuomintang (Chinese Nationalist Party),
then the single ruling party of the Republic of China on Taiwan, and was most famous for writing an unauthorized biography of Chiang Ching-kuo, former president of the Republic of China. He later became a naturalized citizen of the United States. On 15 October, 1984, Liu was shot to death in the garage of his home in Daly City, California. His killers fled the country, returning to Taiwan. They did not face trial until the U.S. Federal Bureau of Investigation discovered a tape made by chief hitman Chen Chi-li implicating Republic of China military intelligence in the killing, whereupon they began to pressure the government to bring Liu's killers to trial. According to Chen's testimony at his trial in Taipei, Wang Hsi-ling of Kuomintang intelligence ordered the assassination.
A month after his conviction, Chen retracted this statement. However, Tung Kuei-sen, another one of the killers, corroborated this fact at his own trial in the United States in 1988, stating that the order for Liu's death had been given by the Taiwanese government. Tung (who had previously been cleared of racketeering charges related to the assassination) was convicted. The assassination became a major political scandal in Taiwan and American officials were critical of the Kuomintang for orchestrating an assassination on United States soil. Helen Liu, Henry Liu's wife, filed suit in United States federal district court against the Republic of China.
The Ninth Circuit Court of Appeals ruled (Liu v. Republic of China) that the ROC government was liable under the doctrine of respondeat superior; a petition for certiorari from the ROC government to the U.S. Supreme Court was subsequently rejected. The suit was later settled out of court. The assassination was the subject of the book Fires of the Dragon by David E. Kaplan. 8. Deng Liberty foundation (鄭南榕基金會), http://www.nylon.org.tw/index.php?option=com_content&view=frontpage&Itemid=1
______
Official: Not Led by the GIO
According to the source that the NDF committee of the Executive Yuen is making an investment in a film implying the KMT government sending assassin to the United States to kill a pro-independence Taiwanese American. A GIO official said that they have heard about this project but there was no conclusion yet. The GIO was asked to conduct the due diligence and is still in the process of gathering the information without any final conclusion made so far. Moreover, this case is not led by the GIO. There is no need to make a big deal out of it.

Sensitive Timing The NDF Discusses NT$120 millions aid to A Movie
Plot…KMT Government Assassinates Pro-Independence Taiwanese American
Will Tiao, an American citizen, is producing the film “Formosa Betrayed” in the United States which implies the KMT government sending assassin to the United States to kill a pro-independence Taiwanese American. However the film is still short of funding and the DPP government is considering investing US$4 millions (about NT$120 millions) to support the film. The NDF Committee of the Executive Yuen invited the several ministries and agencies to a meeting to discuss the investment. But some officials were concerned about the 120-million-investment would fail; therefore, the investment is yet to be decided.
Producer… Will Tiao, An American Citizen with Taiwanese Parents
The parents of Will Tiao are both Taiwanese, who moved to the United States in 1968. Will Tiao started planning the production of this movie as independent film several years ago. The film also garnered attention from the Taiwanese American community. The initial budget for the film production was US$12 millions. Through the Taiwanese American community and pro-Taiwan independence organizations, Tiao started his fundraisings with US$2,500 per share. He also came to Taiwan to seek financial support from the pan-Green organizations such as Taiwan Society. The original plan was to finish the filming and ready to be in the theatre by the presidential election in 2008. However, due to the short of fund, the film has been delayed.
Financial Aid… March 5, Committee Discussed Drawing on the NDF
Based on the information gathered, Will Tiao has raised US$500 through various channels but is still far short from the budget as it initially estimated. The DPP government expressed the willingness to support; furthermore, Hsieh Chih-Wei, the GIO Director, is actively pushing the filming of this movie. Since the GIO can only offer support to domestic films, the Executive Yuen then turned its direction to the National Development Fund(NDF) in the hope to draw on US$4 mils (about NT$120 mils) to invest in this American movie.
According to sources, the NDF committee conducts the review of the investment in Will Tiao’s film in the name of “Investment of Digital Content and Creative Cultural Industry.” The routine meeting in the mid-March was also moved up to March 5 to discuss this film.
Meeting without Conclusion Made…Return to be Evaluated
In the afternoon meeting on March 5, the representatives of Foreign Ministry, Economic Affairs, GIO, OCAC, Cultural Affairs were all present. Hsieh Chih-Wei made a short appearance then left. The OCAC representative was Chang Fu-Mei, the Commissioner.
According to our understanding, due to the large amount of film investment, it is still yet to be evaluated whether there would be return of the over hundred-million-investment. Therefore the deal was not finalized at the 3/5 meeting. The MOFA spokesperson Phoebe Yeh said that the MOFA was notified to attend the meeting and did not invest any money in it. The Film Division of the GIO also expressed that the division did not handle the investment of Tiao’s film.
Motive of Film…Combination of Henry Liu and Chen Wen-Cheng
Will Tiao has expressed his thought about the film on the YouTube. He said that it is a film for the Americans and the international community because most of the Americans did not know that Taiwan went through a period of White Terror. The purpose of this film is to let the world know about the struggle of the Taiwanese to fight for democracy and independence.
The film planned by Will Tiao blends the stories of Henry Liu and Chen Wen-cheng in the 1980s. The film implied a Taiwanese American professor at the Kansas University was assassinated by the killers sent by the Taiwan government in the US. The case was solved through the investigation by an detective. 
 
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 Dear leaders,

Thanks for participating Passport2Taiwan 2007. We, volunteers, and audiences all had great time last year.

This year Passport2Taiwan will be held on May 25. We would like to invite your organization to participate. However, due to recent construction in Union Square North, we are moving to Union Square South which has less space, we can only assign four organizations sharing one booth. The booth is free, but $50 and above donation will be appreciated.

Attached please find the schedule slot that you need to fill-in. Every organization is required to adopt TWO slots. Please reply the attached form before Thursday, May 8 by email or fax will be appreciated.

For more information about Passport2Taiwan 2008, please visit our website at http://p2tw.org.


Sincerely,
Jacy Chen
Passport2Taiwan Committee
917-553-8188 (cell)
212-226-2307 (o)
212-226-7342 (fax)

++++++++++++++++++++++++++
Dear All:

After over 7 million voters elected Ma to become Taiwan
President, actually Ma said he would be the President of ROC,
what is the fate of Taiwanese movement here in North America ?
Apparently there is a big gap between Taiwanese Americans and
the mind of the majority of Taiwanese people.

I would like to call an informal meeting to exchange our
thoughts, to re-evaluate, reposition our principle and movement,
to discuss what's our next step. Should we continue the
movement of UN for Taiwan and other activities to promote Taiwan
or start a new business such as travel agency and thinking
retirement..............

Time: May 18 on Sunday at 5:00 PM
Place: Taiwan Center
We will prepare bento (dinner box) during the session. (please
let us know how many bento are needed before May 17 through
e-mail or phone Yi-Miao at 718-445-7007)

**********************
Taiwan ranks No. 7 in the world in the Digital Opportunity Index
2007-12-02 World Information Society
Report 2007 Citing a government report issued earlier this year, Chen said that about 65.5 percent of Taiwanese, or 13 million people, use the Internet and that the percentage of Internet household access was 74.7 percent. Mobile phone penetration in the population was 103.2 percent, he said.
 Chen said the development of the nation’s IT industry was recognized internationally, citing the International Telecommunication Union’s World Information Society Report 2007, in which Taiwan ranks No. 7 in the world in the Digital Opportunity Index.
 
From Taiwan ,the Gift of Green
2007-12-01
 Washington Post Before my yearin Taiwan , I was a lazy environmentalist, dutifully recycling wine bottles and newspapers and opting for paper over plastic, but never willing to go the extra mile if it wasn’t convenient. It’s no longer so easy to make excuses. Living in a place where I was expected to use what I bought and recycle every last yogurt cup and juice box left me with a new appreciation for what clean streets mean in a civil society, and the realization that I’m responsible for everything I consume. That’s as good a Chinese lesson as any. Julia Ross is a writer and former U.S.
Fulbright scholar in Taiwan . Taiwan sees LED output rising to 540 bln twd by 2015 from 21 bln in 2006 2007-12-01 Forbes - NY,USA TAIPEI (XFN-ASIA) – The output of Taiwan ’s light-emitting diode (LED) industry should reach 540 bln twd by 2015, equivalent to a 23 pct global market share, the Taiwan External Trade Development Council said. Taiwan’s LED production of 21 bln twd last year accounted for 10 pct of the world market, ranking it second among producers, according to the council. The industry expects to achieve production value of 93 bln twd for a 14 pct global market share in 2010, it said. Taiwan's Aboriginals go broadband 2007-11-28 BBC News Given the vast quantities of electronic equipment manufactured in Taiwan it could be assumed that it was one of the most wired countries in the world – but there still remain communities in the country who are isolated from the web.
Now the government wants to change that, and plans to bring broadband to everyone in the country by the end of the year. One of the most recent beneficiaries of this ambitious project is the village of Shan-Mei , home to 700 people from the Tsou tribe, in the remote Aboriginal mountain area in central Taiwan . It is the latest place in the country to get broadband – part of a government plan called the “universal service obligation,” and funded by contributions from all of the island’s phone companies. Taiwan export orders hit record high 2007-11-24 BusinessWeek Taiwan’s export orders hit a record high for a fifth consecutive month in October, partly due to strong demand for laptops from Europe , the Ministry of Economic Affairs said Friday. Export orders rose 17.99 percent in October from a year earlier to $32.20 billion, the ministry said.
Taiwan ranks No. 7 in the world in the Digital Opportunity Index
 2007-12-02
World Information Society Report 2007 Citing a government report issued earlier this year, Chen said that about 65.5 percent of Taiwanese, or 13 million people, use the Internet and that the percentage of Internet household access was 74.7 percent. Mobile phone penetration in the population was 103.2 percent, he said. Chen said the development of the nation’s IT industry was recognized internationally, citing the International Telecommunication Union’s World Information Society Report 2007, in which Taiwan ranks No. 7 in the world in the Digital Opportunity Index.
 From Taiwan , the Gift of Green 2007-12-01 Washington Post Before my year in Taiwan , I was a lazy environmentalist, dutifully recycling wine bottles and newspapers and opting for paper over plastic, but never willing to go the extra mile if it wasn’t convenient. It’s no longer so easy to make excuses. Living in a place where I was expected to use what I bought and recycle every last yogurt cup and juice box left me with a new appreciation for what clean streets mean in a civil society, and the realization that I’m responsible for everything I consume. That’s as good a Chinese lesson as any. juliaross2002@yahoo.com Julia Ross is a writer and former U.S. Fulbright scholar in Taiwan .
Taiwan sees LED output rising to 540 bln twd by 2015 from 21 bln in 2006 2007-12-01 Forbes - NY,USA TAIPEI (XFN-ASIA) – The output of Taiwan ’s light-emitting diode (LED) industry should reach 540 bln twd by 2015, equivalent to a 23 pct global market share, the Taiwan External Trade Development Council said. Taiwan’s LED production of 21 bln twd last year accounted for 10 pct of the world market, ranking it second among producers, according to the council. The industry expects to achieve production value of 93 bln twd for a 14 pct global market share in 2010, it said.
Taiwan's Aboriginals go broadband
2007-11-28 BBC
 News Given the vast quantities of electronic equipment manufactured in Taiwan it could be assumed that it was one of the most wired countries in the world – but there still remain communities in the country who are isolated from the web. Now the government wants to change that, and plans to bring broadband to everyone in the country by the end of the year. One of the most recent beneficiaries of this ambitious project is the village of Shan-Mei , home to 700 people from the Tsou tribe, in the remote Aboriginal mountain area in central Taiwan . It is the latest place in the country to get broadband – part of a government plan called the “universal service obligation,” and funded by contributions from all of the island’s phone companies.
Taiwan Promotes Powerful UMPC for WiMax
2007-11-24 PCWorld
Taiwan has developed a powerful ultramobile PC that can fit in your hand, complete with a speedy 1GHz microprocessor on board. Taiwan is positioning itself to be one of the fastest adopters of WiMax connectivity outside of North America through its M Taiwan initiative. Officials see the technology as a good way to spread broadband Internet access throughout the island, which includes remote mountain villages and sparsely populated outlying islands.
 
Taiwan Economy Grows at Fastest Pace in Three Years
2007-11-22
Bloomberg Nov. 22 (Bloomberg)— Taiwan ’s economy grew at the fastest pace in three years as consumer spending accelerated and exports rose, reinforcing speculation the central bank will increase interest rates next month. Gross domestic product expanded 6.92 percent in the third quarter from a year earlier, the statistics bureau said today in Taipei . That topped all estimates in a Bloomberg News survey of 16 economists, where the median prediction was 5.12 percent. The government also raised its forecasts for economic growth and inflation in 2007 as Taiwanese companies such as AU Optronics Corp. report a surge in profits. Businesses are selling more goods to Europe and Asia and household spending is picking up pace, helping the island’s economy weather a decline in sales to the U.S. , its second-largest market.
Health Care for Every Citizen
2007-11-12
Johns Hopkins Public Health Unlike the United States , Taiwan has reached nearly universal health care coverage, with 99 percent of its 23 million citizens covered. That wasn’t always the case. In 1995, only 58 percent of the population was insured, says Morlock, but through legislative changes that greatly expanded the definition of an “insurable unit,” Taiwan upped its coverage to roughly 90 percent of the population. Officials then worked to cover the remaining 10 percent through community-based programs. 。
Taiwan called "the Israel of the Pacific"
2007-11-06
Haaretz In an editorial of Haaretz, a leading paper and the oldest one in Israel , entitled Our moral nakedness, it says And Israel ? It has no choice but to go with the flow, as they say in Jerusalem . At least this is what Foreign Minister Tzipi Livni did during her visit to Beijing last week, when she praised the “shared values” of China and Israel . Some in Taipei wondered exactly what the minister was referring to – values like democracy, human rights and freedom of speech? The insult to the Taiwanese is particularly harsh in light of their identification with Israel : two small and effervescent “real democracies” engaged in their own security-existential troubles, exposed to threats from a huge external enemy and dependent on American protection and aid. Some call Taiwan “the Israel of the Pacific” and “the David of the Far East .”
Taiwan tops freedom list
2007-10-18
Taipei Times Taiwan’s press freedom ranked No. 1 in Asia and No. 32 worldwide, out-ranking the US , with 169 countries put to the test.
iPhone: Made in Taiwan
2007-07-18
 New York Times TAIPEI, Taiwan — Etched into the back of every iPhone are the words “Designed by Apple in California . Assembled in China .” Apple might as well have added “Made in Taiwan .”
iphone
2007 NewYorkTimes
 Silent Hands Behind the iPhone By KEN BELSON Published: July 18, 2007 (New York Times) TAIPEI , Taiwan — Etched into the back of every iPhone are the words “Designed by Apple in California . Assembled in China .” Apple might as well have added “Made in Taiwan .” Chao-Yang Chan for The New York Times; Workers in protective clothing at Garmin International on Taiwan making global positioning technology products. Chao-Yang Chan for The New York Times; The assembly line at Garmin International, where employees complete a G.P.S. product known as Rumo.
Chao-Yang Chan for The New York Times; Billy Ho, president of Mitac International, said the company grappled with survival strategies in the ‘90s. Now its sales include G.P.S. devices. Chao-Yang Chan for The New York Times One of Garmin International’s finished devices. With little fanfare, Taiwan companies are playing a big role not only in the production of Apple’s latest device but in a wide array of other communications equipment, including the broadband modems in homes across the United States and the next generation of high-speed wireless gear.
Apple does not discuss which vendors it uses, but news reports in Taiwan said that Hon Hai and Quanta received orders to produce millions of iPhone handsets, reports that those companies declined to confirm. Other manufacturers there were almost certainly involved because they provide components used in advanced phones, industry analysts said. Taiwan companies also have a hand in making iPods and iMacs, they said, as well as game machines for Sony and Microsoft. Taiwan ’s rise as a communications workhorse is part of a decade-long transformation under way on this island. Already the world’s biggest producers of computer components, Taiwan companies like Compal Electronics, in addition to Hon Hai and Quanta, have used their expertise to branch out into new markets that use many of the same products.
By harnessing the ability to cut costs, churn out products quickly and work flexibly with customers, the Taiwan companies have become top makers of cellphones, smartphones, broadband modems, wireless routers, global positioning devices, networking equipment and other gear. They, like companies elsewhere, have also made deep inroads into China , where many of their factories are. “It’s not a surprise that the iPhone would be made here because the food chains for Apple’s notebooks and iPods are already in Taiwan ,” said Dominic Grant, a telecommunications analyst at Macquarie in Taipei .
“It’s a natural progression.” Taiwan ’s evolution from computer-making giant to telecommunications Goliath has gone largely unnoticed in the United States because companies here make most of their money as made-to-order manufacturers, not sellers of their own brand products. But Taiwan’s industrial makeover has helped its companies remain competitive in a world increasingly dominated by low-cost Chinese assemblers and by Japanese and South Korean companies with strong footholds in high-end components like flash memory chips. The strategy of repackaging — finding new uses for computer components — has paid dividends. Companies on the island have captured 87 percent of the global market for wireless modems, 84 percent of the D.S.L. modem market and 70 percent of the market for personal digital assistants.
In the competitive cellphone business, Taiwan companies made 12.4 percent of the world’s handsets last year, up from 9.8 percent in 2005, according to the Institute for Information Industry, a government-affiliated research center. That share is expected to grow as brand-name companies like Sony Ericsson outsource more of their production to companies here. In all, Taiwan companies produced $31.5 billion in communications equipment and services last year, more than 50 percent above the total the year before, according to the institute, which expects production to reach a value of $46 billion by 2010. Less than a quarter of that was manufactured on Taiwan , with the bulk made on the Chinese mainland. “It’s been a fairly natural progression because handsets are really a mini-version of the PC, and Taiwanese are adept at adjusting,” said Gary Chia, president of the Yuanta Research Center .
The transformation did not happen by accident. As in much of Asia , the government played an active role in steering businesses into new markets by showering them with tax incentives, cheap property to build factories and research money. Companies on Taiwan have also been able to shift gears smoothly because the concentration of component producers on the island has made it easier to gather the technology and engineers to design and assemble new products.
And Taiwan companies, like their rivals in Japan , South Korea and elsewhere in Asia, have increasingly shifted production to their factories in China to save money. With their close cultural, financial and linguistic ties to mainland China , Taiwan ’s companies have an edge over those from elsewhere. These advantages helped scores of companies tackle new markets. Take D-Link, one of the world’s largest manufacturers of broadband modems. About two decades ago, it started out bymaking network interface cards that linked computers. As Internet access for home use expanded, the company started making dial-up modems.
As phone companies in the United States and elsewhere started leasing modems to their customers, D-Link was flexible and designed products to each carrier’s specifications while remaining cheap enough to nudge out rivals. “Telecommunications companies are difficult to deal with because each one has its own standards, and there is a lot of customization,” said J. C. Liao, D-Link’s president. “But it turned out to be an advantage because Taiwanese are more flexible compared to companies in the U.S. or Japan . We’re quick to lower costs and not stick to our own rules.”
D-Link has evolved with the technology, expanding into wireless modems and pushing into emerging markets like India and Russia , as well as selling under its own brand name at big retailers like Best Buy and Office Depot to become the No. 2 competitor, after Linksys. About 15 percent of the company’s revenue now comes from brand products. Mitac International, a leading seller of global positioning devices, took a similar route. Through the 1980s and early ’90s, it built personal computers for the likes of Compaq. But as profit margins slipped and mergers reshaped the industry, the company started making personal digital assistants.
Then Hewlett-Packard bought Compaq, leaving Mitac short a big customer. So when the United States government allowed civilians to use G.P.S. technology, the company integrated it into its personal digital assistants after a couple of years of development. Mitac joined another leader in the industry, Garmin, which is based in Kansas but makes almost all its G.P.S. devices in Taiwan . “We saw these big waves come one by one in the mid-1990s, so we tried to figure out how to survive in this rapidly changing business,” said Billy Ho, the president of Mitac International, which sells G.P.S. devices under the Mio brand. “We realized there was no Microsoft in the digital map business.” Mitac still earns about 70 percent of its sales by making desktop computers, servers and other technology for other companies, though Mr. Ho hopes that the share will fall to 50 percent by next year.
Since so many of the latest devices are made here, it is perhaps unsurprising that some Taiwan companies are beating brand-name companies to the punch. High Tech Computer, for instance, introduced a touch-based handset just weeks before the iPhone was released. With a less recognizable name, High Tech has more modest ambitions. But it is still pleased that Apple has joined the market. “We’re happy they share the same vision as we do,” said Fred Liu, the chief operating officer. “We think these phones will change people’s minds and their behavior.” While D-Link, High Tech and Mitac have developed brand-name products to reduce their reliance on their made-to-order business, there are plenty of other companies that have had trouble branching out on their own.
For instance, in 2005 BenQ, which primarily made cellphones for other companies, bought the handset division of Siemens in hopes of taking on the likes of Sony Ericsson and LG. Yet BenQ, a spinoff of the Taiwan computer giant Acer, alienated one of its biggest customers, Motorola, which was wary of having a new competitor manufacturing its products. BenQ also underestimated the depth of Siemens’s problems and how much it would cost to break into an already crowded and competitive cellphone market. After losses mounted, BenQ liquidated the venture and will focus its energy on making handsets for other companies, as well as on its existing businesses producing flat-panel monitors, televisions and digital cameras.
“People thought with Acer’s success, BenQ could make it, too, since its chairman came from Acer,” said Kirk Yang, managing director at Citigroup in Hong Kong . “But the acquisition was a black hole. BenQ didn’t have a home base and had no experience running a branded handset business.” Mr. Yang and other analysts said that Taiwan companies were unlikely to abandon their made-to-order business entirely. Instead, they will focus more on doing more design work on behalf of customers who are trying to outsource more and more of their production.
“The iPhone is a great example of where Taiwan is still strong: reliable sourcing, leading technology and complex integration,” said Allen J. Delattre, chief of the electronics and high-technology practice at the consulting firm Accenture. “Does the average person who buys an iPhone know it’s from Taiwan ? Maybe. Do they care? Probably not. But if you look at the companies in Taiwan , they are behind the scenes, and that’s a good place to be because that’s where the value is.” The key for Taiwan companies, Mr. Delattre and other analysts said, is to invest in next-generation products early.
For example, companies here are fast becoming important players in the development of WiMax wireless and fiber optic broadband equipment. They are again getting a healthy push from the government, which is spending more than $200 million over five years to help create the world’s largest high-speed WiMax network. By next year, with 2,000 base stations spread across the island, companies will be able to start testing new applications, like the sending of video from ambulances on their way to hospitals. “We are trying to make the infrastructure more complete,” said Tsung-Tsong Wu, deputy minister of the National Science Council, which has a $1 billion annual budget. “If the highways are built, companies can go as fast as they like.”