Taipei Times: Worldwide, Trend Micro (趨勢科技) has a number of computer virus-fighting labs, brought to public attention by the Melissa virus and the ILOVEYOU virus -- how much emphasis do you put on day-to-day virus fighting?
Chang: It's very important from a customer point of view. New viruses are developed everyday -- four or five viruses. So no matter how good your technology or software is, when a new virus comes along, [the technology] is out of date in an instant. Customers want a quick response to prevent their server from going down. So for our main 24-hour anti-virus crime lab, we needed good engineers who speak English well, so we set it up in the Philippines, so from the Philippines we can offer worldwide support at a very low cost.
TT: Is it true there is a locked vault somewhere in Taipei where Trend stores computer viruses?
Chang: Yes, we have several in Taipei, and in our virus labs in Manila, California and Paris. We have several hundred thousand infected files and a collection of over 25,000 distinct viruses stored on 14 PC servers here in Taipei. We like to think of it as our "Center for Disease Control, like the one in Atlanta, Georgia. I'm an e-epidemiologist. I collect them for interest and for research and the development of new anti-virus programs.
TT: How safe is that?
Chang: We're very serious about safety in handling live viruses. First of all, all viruses or potentially infected files are stored on isolated computers, with no connections to any other system or network. This prevents any accidental infections. Access to the virus files is restricted to authorized anti-virus engineers only. Any work involving live viruses must be carried out under strict quarantine procedures and we are very serious about enforcing our virus handling regulations among our employees.
TT: How did you come up with the idea of creating anti-virus software back in 1988? The Internet and e-mail were not very popular back then, so where was the market for that kind of product?
Chang: I had already started a software company at that time, and we'd had problems with people pirating our software, so we started making anti-piracy locks for high-value software programs.
About the same time, I heard about a new anti-piracy program available in Pakistan -- it was a program embedded in the floppy disk that could destroy an entire computer hard disk and all stored information if the program was used without payment. I got hold of a copy of the program called C-Brain and we had our first virus.
A software engineer working with me at the time said the program could really cause a lot of damage if it were misused. With computers -- especially personal computers -- becoming more and more a part of people's lives, I knew companies and people would need to protect their data from computer viruses. Therefore I put all my money into the anti-virus business, but I never dreamed it would become the kind of market it is today, a US$2 billion a year industry.
TT: Microsoft seems to have a lot of trouble with computer viruses attacking and utilizing its e-mail programs. Is there any cooperation between Trend and Microsoft to put an end to that problem?
Chang: Yes, we work very close with Microsoft. We even have an office at their Redmond (Washington) campus to help Trend anti-virus technology integrate smoothly with their Exchange 2000 program. When they rolled it out, we were part of their program.
TT: Trend originally opened in Taiwan in 1985, but then moved to Cupertino, California and then again to Tokyo. Why all the moving around, and why not stay in Taiwan?
Chang: It's a long story but I'll make it brief. We started our business in the US because we believed that if you really want to start a software business, the US is the most competitive place to be. So we started there.
The reason we moved back to Taiwan is because at that time we signed a licensing contract with Intel which gave them exclusive rights to sell our software in North America and Europe. So Asia was the only place we could make our own software sales under our own brand name -- so we moved here to sell in Taiwan, Hong Kong and Japan.
Once we got home, we wanted to list on the stock market but found out we could not offer employee-stock option plans because regulations here were still too stiff. Therefore we had to find somewhere we could issue stock options. Japan is the biggest financial market in Asia, so we moved to Tokyo and have stayed there ever since.
TT: Is there any advice you would give to a Taiwanese software company now on how to grow their company?
Chang: I think to get bigger, you have to do something outside of Taiwan, the market size is just too ... it's tiny. Software is an industry where you need a big R&D investment up front, then you need to leverage the product -- sell as many copies as you can and make as much money as you can -- in order to continue innovation and ensure good people will join you.
Therefore, my only advice is: Go global, you've got to go global [with software]. You've also got to focus: In each country, what is your competitive advantage? In Brazil, in Germany, what is your competitive advantage to win the local market? You have to identify the competitive advantage for each country and focus on that.
TT: Is there anything the government could do to help promote the software industry in Taiwan?
Chang: The government is there to promote the industry, but I think it's hard for the government to boost the software business itself. Software is intellectual property, and it's made by innovation. Innovation has to do with education and entrepreneurship, both of which Taiwan already has.
One part of the problem was there used to be an Intel, Windows tie-up, the so-called "Wintel platform" which preoccupied the entire industry. The room for a Taiwan company to innovate or create throughout the industry was very limited. But now, Linux is coming, wireless is coming, broadband is coming so you do not have to create products for the Wintel platform of software and devices. These three things have created a world of new opportunity for software companies.
Traditionally, Taiwan is more focused on manufacturing. Manufacturing has very few value-added services, so right now there are problems. This is only short term, though, because eventually Taiwan will still be able to find a position on Internet devices, embedded systems, and middleware. There are a lot of opportunities in these areas for Taiwanese software makers.
TT: What about for Trend?
Chang: Broadband, broadband is everything. Broadband for us is a revolution. ... there will be a constant threat from hackers, viruses and there is no defense for this threat. Today, Trend has recently announced a very exciting product called "Gate Lock" -- like a lock in a gate -- this is our killer-application. It keeps out hackers, viruses and acts like a personal firewall. The world's first Internet broadband security device.
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