9 ms·

China is winning the global tech race

72 points by dsr12 8y ago

announcerman 8y ago
I wonder if the reason for this is mainly due to how much leeway you have as long as you use your technology for the benefit of the ruling party. Isn't it much easier to work on things like harvesting personal information if you don't have GDPR breathing down your neck? Hell the government might even help your tech startup with basically unlimited cash as long as you help them with your tech.
- JumpCrisscross 8y ago
  > as long as you use your technology for the benefit of the ruling party The dark side of this leeway are demands for patronage from middle-level bureaucrats.
rb808 8y ago
Meanwhile ZTE goes bust if it can't buy American chips. I dont see any Chinese tech that is unique.
- cobookman 8y ago
  ebikes, scooters, and hoverboards were all out of china.
  - dagw 8y ago
    Can't speak for "hoverboards", but ebikes and scooter where definitely not "out of China", sure they no doubt win in volume and price, but they where hardly trailblazing or innovative in the space.
- ajiang 8y ago
  Do you mean Qualcomm chips and smartphone tech that practically every runs every smartphone in the world? I can see how that would impact ZTE's smartphone business... https://en.wikipedia.org/wiki/Qualcomm#History https://en.wikipedia.org/wiki/Qualcomm#History
  - dagw 8y ago
    Completely OT, but I just realized that Qualcomm the chip company and Qualcomm the email software company are one and the same. Don't know why I never made that connection before.
melling 8y ago
Interesting article by Michael Moritz of Sequoia Capital. China is taking the lead. “All lists of private companies contain degrees of subjectivity and error, but the Wikipedia ranking of unicorn start-ups by value offers a peek into the future. For westerners, it should be disconcerting. Of the top 50 entries, 26 are Chinese and 16 are American. There are none from Europe. The Chinese also dominate the proportion of the most valuable of these companies. Of the top 20 with an estimated market value of over $10bn, 11 are Chinese, six are American and two are Indian. “
- baybal2 8y ago
  >Sequoia Capital. Rephrasing: Chinese sock market is more plump, and more crazy than American. If you are in a business peddling BS stocks, there is no better market. I'm extremely sorry for use of vulgarities there, but I know of no other words in English language to characterise that. On other hand... China's tech scene beats the silicon valley even without any stock market backing. And it is its beauty. China is probably the last place in the world where BS "high finance" has not yet gobbled up the tech scene. Things are still done by real men of merit, real industrialists, real Chinese Carnegies. I personally knew of people who secured cash on the table for their businesses from them with just gentleman's agreement without them bowing down to any of "high finance" gatekeepers. To Sonny >I'm actually really surprised there isn't some great, commonly available mobile OS from China commonly available here ... Well... a big part of South Asia know no other mobile OS other than what I call "Chindroid." Something that comes with custom skin on top of Android 2.0 era forks of Cyanogen. There is a whole culture grown around that. >Then why does nobody outside of China use Chinese tech? This is a paradox that flies in the face of all the 'great news' coming from China. I'm totally disagreeing with you on that. China's tech is ee-ve-ry-whe-re... except for America... What half of Africa uses? A $20 dollars white label BuBuGao phone. What half of South Asia depends on water filtration? Cheap Chinese membrane filters. Who makes 70% of industrial chemicals, 30% of generic medicines, and 50% of precursor chemicals? Whose heavy equipment is used everywhere outside of developer world... Who has a complete dominance in manufacturing machinery? Whose white goods totally dominate every non-OECD country? This list will span for a kilometre. Behind all of these things stand businesses that are head above all those "unicorns" where it comes to being considered "substantial" Nobody will blink an eye if one of those 10000 facebook.com unicorn clones will disappear tomorrow, but if something will happen the biggest maker of fertilizers in China tomorrow, the whole world will turn silent for at least a few minutes.
heinrichhartman 8y ago
Paywalled. I can't read this.
- deleted 8y ago
  [deleted]
- pella 8y ago
  maybe: try via twitter link ( https://twitter.com/FT/status/1008323779360157696 https://twitter.com/FT/status/1008323779360157696 ) - and open in a new incognito window.
corporateslaver 8y ago
This is propaganda. China is mostly an uneducated factory nation who will be crushed by automation. Articles like this are great for clicks on a website. Edit: which Chinese tech companies are actually dominant? All of them are copies of American tech companies propped up by their government. Where is the market penetration into the USA? Where is the competition? There is none.
- ajiang 8y ago
  Author is Sequoia's Michael Moritz who has a decent amount of credibility here. I think his last few articles on China have been more around warning US tech companies not to get complacent, rather than trying to convince people that China is a tech holy land. As for the part about being an uneducated factory nation, the latest PISA findings from 2015 would have China scoring higher than the US on math (10th vs. 25th) and science (6th vs. 40th), but slightly lower than the US on reading (27th vs. 24th).
  - chii 8y ago
    > Sequoia's Michael Moritz who has a decent amount of credibility but you have to also think whether he's biased in wanting to push the view that the next big tech hub is in China, because he's invested in the region. Making the hype machine so that when time comes to exit, there's plenty of doofus who will believe the hype and buy into the market. it's very hard to know what to believe, and even more effort to do research. Most people won't be doing it, so it's an effective method to generate hype.
    - thablackbull 8y ago
      > but you have to also think whether he's biased in wanting to push the view that the next big tech hub is in China, because he's invested in the region. He puts his money where his mouth is. I made another comment here that it was refreshing as it didn't predict the collapse of China which has been peddled for the past few decades by so-called experts - they could peddle any view they want with no financial repercussion. Secondly, even if Moritz was biased and published this article for his own gains, it's not as if we (foreigners) have easy access to invest in the region. > it's very hard to know what to believe, and even more effort to do research. Most people won't be doing it, so it's an effective method to generate hype. I heartily agree with you here, but you have to admit for every article like this, there are 10x more about the imminent demise of China, so I don't buy the argument that this article's hype will override 'collapse' articles which generate much more clicks.
bottomhollow 8y ago
According to the article, China is winning because it has more unicorns than others in > 10 billion: 11 are Chinese vs 6 are American. This is just VC pumping its own game. Massively overvalued Chinese startups fueled by unsustainable shadow debt taking isn't a recipe for success. "China’s campaign against its US$10 trillion shadow banking industry has choked off refinancing for the weaker borrowers". let that sink in......10 Trillion debt that needs to be unwound in China, mostly corporate debt. "Chinese corporate debt to GDP ratio is already very high by international standards – at 168 per cent in 2017 – and is expected to start rising again as nominal GDP growth declines towards the 8 per cent from an unusually high rate of over 11 per cent in 2017, Fitch said. Further payment problems are likely in a market that has already seen at least 14 corporate bond defaults this year" http://www.scmp.com/news/china/economy/article/2149108/curbing-chinas-corporate-debt-could-hit-economic-growth-report http://www.scmp.com/news/china/economy/article/2149108/curbi... Also, this is happening in times of economic slowdown in China, due to trade wars, tariff from US, reshoring of manufacturing back to US, declining FDI, etc. "China's economic growth slows to multi-decade lows across industrial, infrastructure and retail" http://www.abc.net.au/news/2018-06-14/china-growth-stumbles-on-weaker-industrial-production-and-inves/9870214 http://www.abc.net.au/news/2018-06-14/china-growth-stumbles-... "Two-thirds of the 21 tech IPOs in the past year are below their issue price, with shares down an average of about 20 per cent through Friday. Leading the wipe out are online financing platforms Qudian Inc and PPDai Group Inc, which plummeted 55 per cent and 48 per cent respectively, while search engine Sogou Inc has tanked 27 per cent." http://www.scmp.com/tech/article/2146122/struggling-chinese-tech-debuts-dont-bode-well-unicorn-ipos http://www.scmp.com/tech/article/2146122/struggling-chinese-...
- chii 8y ago
  > unsustainable shadow debt i keep hearing this term, but what does shadow debt mean?
  - rm_-rf_slash 8y ago
    Unregulated unofficial loans. They have played a major role in developing China’s economy outside of the rigidly regulated financial sector. However their total value and creditworthiness is not entirely known. The Chinese government doesn’t want to shut down the shadow debt markets wholesale, because of their outsize influence on the economy, but for the same reason they don’t want shadow lending to get too out of hand either. If there is a credit crunch or economic contraction, it will be harder to manage the consequences of unofficial debt than official debt.
ilamont 8y ago
TFA is blocked. Does it talk about protectionism, cronyism, poor IP enforcement, restrictions on foreign media and communication companies, or forced technology transfer from foreign firms as a condition of doing business in China? These aren't the only factors behind China's rise as a tech superpower, but without them China wouldn't be where it is today.
- coldtea 8y ago
  So like most other countries that are now pointing their fingers? http://theconversation.com/trumps-protectionism-continues-long-history-of-us-rejection-of-free-trade-91190 http://theconversation.com/trumps-protectionism-continues-lo... http://foreignpolicy.com/2012/12/06/we-were-pirates-too/ http://foreignpolicy.com/2012/12/06/we-were-pirates-too/ http://www.spiegel.de/international/zeitgeist/no-copyright-law-the-real-reason-for-germany-s-industrial-expansion-a-710976.html http://www.spiegel.de/international/zeitgeist/no-copyright-l...
  - mistermann 8y ago
    Do these other countries continue to enjoy WTO Developing Nation Status, which enables a lot of the unfair advantages China enjoys as pointed out by the grandparent comment? https://www.wto.org/english/tratop_e/devel_e/dev_special_differential_provisions_e.htm#legal_provisions https://www.wto.org/english/tratop_e/devel_e/dev_special_dif... Pointing out the historic cheating of now first world countries is fair if questionably relevant, pointing out Donald Trump's raising of tariffs as hypocrisy (I assume) is down right silly, especially in the context of this conversation.
    - coldtea 8y ago
      >Do these other countries continue to enjoy WTO Developing Nation Status, which enables a lot of the unfair advantages China enjoys as pointed out by the grandparent comment? No -- they don't need it as much, as they already climbed the lax-IP/protectionism ladder for centuries to get high. Now they insist nobody currently lower than them should use the ladder.
kraig911 8y ago
The bigger China grows the more important IP and patents will become thus making it like all the rest. India will be the next giant to be exploited.
ajiang 8y ago
I think most people voting / commenting are not actually able to read the article due to paywall. Adding the text so discussion is more substantial. @HN not sure if this goes against any rules, my feelings won't be hurt if the below is removed. Cast your eyes down the list of the world’s most valuable private technology companies and you might be put in mind of the 2008 Beijing Olympics. That’s when China ran away with most of the gold medals — even though the west focused on the accomplishments of the US swimmer Michael Phelps. The same trend is evident in the list of technology “unicorns” worth $1bn or more. Uber, Airbnb and SpaceX may be hogging the limelight, but the undisputed gold medal leaders are the Chinese. All lists of private companies contain degrees of subjectivity and error, but the Wikipedia ranking of unicorn start-ups by value offers a peek into the future. For westerners, it should be disconcerting. Of the top 50 entries, 26 are Chinese and 16 are American. There are none from Europe. The Chinese also dominate the proportion of the most valuable of these companies. Of the top 20 with an estimated market value of over $10bn, 11 are Chinese, six are American and two are Indian. Topping the list with an estimated value of $150bn is Ant Financial, the financial services spin off from Alibaba. Its value rests on the opportunities investors believe lie ahead in China and, increasingly, in south-east Asia. Many California-based technology investment bankers — eager to haul in trophy initial public offerings — are now romancing more companies in China than at home. Smartphone maker Xiaomi has already filed to float in Hong Kong, which must be disquieting for the US exchanges. Ride-hailing app Didi Chuxing and Meituan are among the bankers’ other targets. The growth rates of leading public technology companies underline the same trends. For the year ending March 2018, the top five US companies grew at a 26 per cent median clip, while the top five Chinese entities jumped 33 per cent. The US companies are generally larger, but Chinese companies are narrowing the gap. As 2016 dawned, the top five Chinese companies were worth one-quarter of their US counterparts. By the end of March 2018 this had risen to one-third. Right now, Facebook, the fifth most valuable US tech group, is just ahead of Alibaba, with Tencent not far behind. No wonder that Chinese youngsters looking for role models evoke the names of Jack Ma, Pony Ma, Lei Jun (founders of Alibaba, Tencent and Xiaomi) more than they do Amazon’s Jeff Bezos, Facebook’s Mark Zuckerberg, or the late Steve Jobs of Apple. Chinese internet companies also stand out because they are purchasing stakes in many of the more interesting, younger private technology companies. It is somewhat akin to real estate companies snapping up the best beach-front property. Most Chinese activity is outside the US, with Tencent and Alibaba building vast constellations of satellites. Tencent has more than 600 investments, while Alibaba has around 400 — totals that almost make Japan’s SoftBank look like a penny-pinching slowpoke. Critics of this approach may gripe that it is undisciplined, but the admirers argue that these investments are somewhat akin to Chinese premier Xi Jinping’s ambitious and far-reaching Belt and Road Initiative. The only US company that comes close is Google, which since the start of 2017 has made more than 100 investments, although they are heavily concentrated in the US. It has also purchased more than 80 companies outright since 2014. Another transpacific difference involves the use of cash. Between 2015 and 2017, the five biggest US tech groups (especially Apple and Microsoft) spent $228bn on stock buybacks and dividends, Bloomberg data shows. During the same period, the top five Chinese tech companies spent just $10.7bn and ploughed the rest of their excess cash into investments that broaden their footprint and influence. It’s hard to escape the view that the Chinese groups are — like all of us — creatures of their heritage. They are using their investments as one way to help fulfil the ancient Chinese definition of the Middle Kingdom — as the centre around which all else revolves. The writer is a partner of Sequoia Capital. The views expressed are his own and he may own shares in companies mentioned
Proven 8y ago
Statist nonsense! As expected from the socialists at the FT.... China is a Ponzi society, completely hopeless.
vthallam 8y ago
I know this article is more about tech companies, but China is winning everywhere. They have started a very ambitious OBOR to connect Europe, Africa and Asia. The Chinese investments in Europe is just mind boggling [0] and the infrastructure projects by the Chinese Govt are spread across the whole Asia, Africa and Europe. Unlike the USA which offers support and aid by offering money to other countries, the Chinese loan tons of money to build infrastructure and it is so much that the small countries will not be able to pay and literally submit to the Chinese. [1] [0] - https://www.bloomberg.com/graphics/2018-china-business-in-europe/ https://www.bloomberg.com/graphics/2018-china-business-in-eu... [1] - https://www.nytimes.com/2017/12/12/world/asia/sri-lanka-china-port.html https://www.nytimes.com/2017/12/12/world/asia/sri-lanka-chin...
- mc32 8y ago
  Kind of a United Fruit model of economic investing which resulted in the pejorative banana republic and resulting cries of American Imperialism, and subsequent loss in economic growth as AmCos pulled out due to instability. Wonder if they can avoid a similar fate. Maybe people are wiser on both sides, one can hope.
  - mywittyname 8y ago
    My impression is that much of this "instability" was largely the result of American military/intelligence intervention that came in response to the local government seizure and nationalization of these industries.
    - mc32 8y ago
      Superficially maybe. My impression is most of the instability was countries with govts with too weak an effort to transition from an agricultural society to a goods and services centered one, this resulted in an ill advised call for land redistribution and other unrest rather than making education necessary for all kids. Even now many illegal manual labor immigrants to the US lack basic education.
- chii 8y ago
jsadamsnyc 8y ago
They are winning more than the global tech race.. :(
whazor 8y ago
I believe China is too unbalanced in their IP protection in order to 'win the tech race'. They either have a monopoly that controls the market via Chinese gov, or there are no rules at all and everyone will backstab you. I believe that these conditions are unfavorable for true technological innovation.

72 points by dsr12 8y ago

I wonder if the reason for this is mainly due to how much leeway you have as long as you use your technology for the benefit of the ruling party. Isn't it much easier to work on things like harvesting personal information if you don't have GDPR breathing down your neck? Hell the government might even help your tech startup with basically unlimited cash as long as you help them with your tech.

JumpCrisscross 8y ago
> as long as you use your technology for the benefit of the ruling party The dark side of this leeway are demands for patronage from middle-level bureaucrats.

rb808 8y ago

Meanwhile ZTE goes bust if it can't buy American chips. I dont see any Chinese tech that is unique.

cobookman 8y ago
ebikes, scooters, and hoverboards were all out of china.
- dagw 8y ago
  Can't speak for "hoverboards", but ebikes and scooter where definitely not "out of China", sure they no doubt win in volume and price, but they where hardly trailblazing or innovative in the space.
ajiang 8y ago
Do you mean Qualcomm chips and smartphone tech that practically every runs every smartphone in the world? I can see how that would impact ZTE's smartphone business... https://en.wikipedia.org/wiki/Qualcomm#History https://en.wikipedia.org/wiki/Qualcomm#History
- dagw 8y ago
  Completely OT, but I just realized that Qualcomm the chip company and Qualcomm the email software company are one and the same. Don't know why I never made that connection before.

melling 8y ago

Interesting article by Michael Moritz of Sequoia Capital. China is taking the lead. “All lists of private companies contain degrees of subjectivity and error, but the Wikipedia ranking of unicorn start-ups by value offers a peek into the future. For westerners, it should be disconcerting. Of the top 50 entries, 26 are Chinese and 16 are American. There are none from Europe. The Chinese also dominate the proportion of the most valuable of these companies. Of the top 20 with an estimated market value of over $10bn, 11 are Chinese, six are American and two are Indian. “

baybal2 8y ago
>Sequoia Capital. Rephrasing: Chinese sock market is more plump, and more crazy than American. If you are in a business peddling BS stocks, there is no better market. I'm extremely sorry for use of vulgarities there, but I know of no other words in English language to characterise that. On other hand... China's tech scene beats the silicon valley even without any stock market backing. And it is its beauty. China is probably the last place in the world where BS "high finance" has not yet gobbled up the tech scene. Things are still done by real men of merit, real industrialists, real Chinese Carnegies. I personally knew of people who secured cash on the table for their businesses from them with just gentleman's agreement without them bowing down to any of "high finance" gatekeepers. To Sonny >I'm actually really surprised there isn't some great, commonly available mobile OS from China commonly available here ... Well... a big part of South Asia know no other mobile OS other than what I call "Chindroid." Something that comes with custom skin on top of Android 2.0 era forks of Cyanogen. There is a whole culture grown around that. >Then why does nobody outside of China use Chinese tech? This is a paradox that flies in the face of all the 'great news' coming from China. I'm totally disagreeing with you on that. China's tech is ee-ve-ry-whe-re... except for America... What half of Africa uses? A $20 dollars white label BuBuGao phone. What half of South Asia depends on water filtration? Cheap Chinese membrane filters. Who makes 70% of industrial chemicals, 30% of generic medicines, and 50% of precursor chemicals? Whose heavy equipment is used everywhere outside of developer world... Who has a complete dominance in manufacturing machinery? Whose white goods totally dominate every non-OECD country? This list will span for a kilometre. Behind all of these things stand businesses that are head above all those "unicorns" where it comes to being considered "substantial" Nobody will blink an eye if one of those 10000 facebook.com unicorn clones will disappear tomorrow, but if something will happen the biggest maker of fertilizers in China tomorrow, the whole world will turn silent for at least a few minutes.

heinrichhartman 8y ago

Paywalled. I can't read this.

deleted 8y ago
[deleted]
pella 8y ago
maybe: try via twitter link ( https://twitter.com/FT/status/1008323779360157696 https://twitter.com/FT/status/1008323779360157696 ) - and open in a new incognito window.

corporateslaver 8y ago

This is propaganda. China is mostly an uneducated factory nation who will be crushed by automation. Articles like this are great for clicks on a website. Edit: which Chinese tech companies are actually dominant? All of them are copies of American tech companies propped up by their government. Where is the market penetration into the USA? Where is the competition? There is none.

ajiang 8y ago
Author is Sequoia's Michael Moritz who has a decent amount of credibility here. I think his last few articles on China have been more around warning US tech companies not to get complacent, rather than trying to convince people that China is a tech holy land. As for the part about being an uneducated factory nation, the latest PISA findings from 2015 would have China scoring higher than the US on math (10th vs. 25th) and science (6th vs. 40th), but slightly lower than the US on reading (27th vs. 24th).
- chii 8y ago
  > Sequoia's Michael Moritz who has a decent amount of credibility but you have to also think whether he's biased in wanting to push the view that the next big tech hub is in China, because he's invested in the region. Making the hype machine so that when time comes to exit, there's plenty of doofus who will believe the hype and buy into the market. it's very hard to know what to believe, and even more effort to do research. Most people won't be doing it, so it's an effective method to generate hype.
  - thablackbull 8y ago
    > but you have to also think whether he's biased in wanting to push the view that the next big tech hub is in China, because he's invested in the region. He puts his money where his mouth is. I made another comment here that it was refreshing as it didn't predict the collapse of China which has been peddled for the past few decades by so-called experts - they could peddle any view they want with no financial repercussion. Secondly, even if Moritz was biased and published this article for his own gains, it's not as if we (foreigners) have easy access to invest in the region. > it's very hard to know what to believe, and even more effort to do research. Most people won't be doing it, so it's an effective method to generate hype. I heartily agree with you here, but you have to admit for every article like this, there are 10x more about the imminent demise of China, so I don't buy the argument that this article's hype will override 'collapse' articles which generate much more clicks.

bottomhollow 8y ago

According to the article, China is winning because it has more unicorns than others in > 10 billion: 11 are Chinese vs 6 are American. This is just VC pumping its own game. Massively overvalued Chinese startups fueled by unsustainable shadow debt taking isn't a recipe for success. "China’s campaign against its US$10 trillion shadow banking industry has choked off refinancing for the weaker borrowers". let that sink in......10 Trillion debt that needs to be unwound in China, mostly corporate debt. "Chinese corporate debt to GDP ratio is already very high by international standards – at 168 per cent in 2017 – and is expected to start rising again as nominal GDP growth declines towards the 8 per cent from an unusually high rate of over 11 per cent in 2017, Fitch said. Further payment problems are likely in a market that has already seen at least 14 corporate bond defaults this year" http://www.scmp.com/news/china/economy/article/2149108/curbing-chinas-corporate-debt-could-hit-economic-growth-report http://www.scmp.com/news/china/economy/article/2149108/curbi... Also, this is happening in times of economic slowdown in China, due to trade wars, tariff from US, reshoring of manufacturing back to US, declining FDI, etc. "China's economic growth slows to multi-decade lows across industrial, infrastructure and retail" http://www.abc.net.au/news/2018-06-14/china-growth-stumbles-on-weaker-industrial-production-and-inves/9870214 http://www.abc.net.au/news/2018-06-14/china-growth-stumbles-... "Two-thirds of the 21 tech IPOs in the past year are below their issue price, with shares down an average of about 20 per cent through Friday. Leading the wipe out are online financing platforms Qudian Inc and PPDai Group Inc, which plummeted 55 per cent and 48 per cent respectively, while search engine Sogou Inc has tanked 27 per cent." http://www.scmp.com/tech/article/2146122/struggling-chinese-tech-debuts-dont-bode-well-unicorn-ipos http://www.scmp.com/tech/article/2146122/struggling-chinese-...

chii 8y ago
> unsustainable shadow debt i keep hearing this term, but what does shadow debt mean?
- rm_-rf_slash 8y ago
  Unregulated unofficial loans. They have played a major role in developing China’s economy outside of the rigidly regulated financial sector. However their total value and creditworthiness is not entirely known. The Chinese government doesn’t want to shut down the shadow debt markets wholesale, because of their outsize influence on the economy, but for the same reason they don’t want shadow lending to get too out of hand either. If there is a credit crunch or economic contraction, it will be harder to manage the consequences of unofficial debt than official debt.

ilamont 8y ago

TFA is blocked. Does it talk about protectionism, cronyism, poor IP enforcement, restrictions on foreign media and communication companies, or forced technology transfer from foreign firms as a condition of doing business in China? These aren't the only factors behind China's rise as a tech superpower, but without them China wouldn't be where it is today.

coldtea 8y ago
So like most other countries that are now pointing their fingers? http://theconversation.com/trumps-protectionism-continues-long-history-of-us-rejection-of-free-trade-91190 http://theconversation.com/trumps-protectionism-continues-lo... http://foreignpolicy.com/2012/12/06/we-were-pirates-too/ http://foreignpolicy.com/2012/12/06/we-were-pirates-too/ http://www.spiegel.de/international/zeitgeist/no-copyright-law-the-real-reason-for-germany-s-industrial-expansion-a-710976.html http://www.spiegel.de/international/zeitgeist/no-copyright-l...
- mistermann 8y ago
  Do these other countries continue to enjoy WTO Developing Nation Status, which enables a lot of the unfair advantages China enjoys as pointed out by the grandparent comment? https://www.wto.org/english/tratop_e/devel_e/dev_special_differential_provisions_e.htm#legal_provisions https://www.wto.org/english/tratop_e/devel_e/dev_special_dif... Pointing out the historic cheating of now first world countries is fair if questionably relevant, pointing out Donald Trump's raising of tariffs as hypocrisy (I assume) is down right silly, especially in the context of this conversation.
  - coldtea 8y ago
    >Do these other countries continue to enjoy WTO Developing Nation Status, which enables a lot of the unfair advantages China enjoys as pointed out by the grandparent comment? No -- they don't need it as much, as they already climbed the lax-IP/protectionism ladder for centuries to get high. Now they insist nobody currently lower than them should use the ladder.

kraig911 8y ago

The bigger China grows the more important IP and patents will become thus making it like all the rest. India will be the next giant to be exploited.

ajiang 8y ago

I think most people voting / commenting are not actually able to read the article due to paywall. Adding the text so discussion is more substantial. @HN not sure if this goes against any rules, my feelings won't be hurt if the below is removed. Cast your eyes down the list of the world’s most valuable private technology companies and you might be put in mind of the 2008 Beijing Olympics. That’s when China ran away with most of the gold medals — even though the west focused on the accomplishments of the US swimmer Michael Phelps. The same trend is evident in the list of technology “unicorns” worth $1bn or more. Uber, Airbnb and SpaceX may be hogging the limelight, but the undisputed gold medal leaders are the Chinese. All lists of private companies contain degrees of subjectivity and error, but the Wikipedia ranking of unicorn start-ups by value offers a peek into the future. For westerners, it should be disconcerting. Of the top 50 entries, 26 are Chinese and 16 are American. There are none from Europe. The Chinese also dominate the proportion of the most valuable of these companies. Of the top 20 with an estimated market value of over $10bn, 11 are Chinese, six are American and two are Indian. Topping the list with an estimated value of $150bn is Ant Financial, the financial services spin off from Alibaba. Its value rests on the opportunities investors believe lie ahead in China and, increasingly, in south-east Asia. Many California-based technology investment bankers — eager to haul in trophy initial public offerings — are now romancing more companies in China than at home. Smartphone maker Xiaomi has already filed to float in Hong Kong, which must be disquieting for the US exchanges. Ride-hailing app Didi Chuxing and Meituan are among the bankers’ other targets. The growth rates of leading public technology companies underline the same trends. For the year ending March 2018, the top five US companies grew at a 26 per cent median clip, while the top five Chinese entities jumped 33 per cent. The US companies are generally larger, but Chinese companies are narrowing the gap. As 2016 dawned, the top five Chinese companies were worth one-quarter of their US counterparts. By the end of March 2018 this had risen to one-third. Right now, Facebook, the fifth most valuable US tech group, is just ahead of Alibaba, with Tencent not far behind. No wonder that Chinese youngsters looking for role models evoke the names of Jack Ma, Pony Ma, Lei Jun (founders of Alibaba, Tencent and Xiaomi) more than they do Amazon’s Jeff Bezos, Facebook’s Mark Zuckerberg, or the late Steve Jobs of Apple. Chinese internet companies also stand out because they are purchasing stakes in many of the more interesting, younger private technology companies. It is somewhat akin to real estate companies snapping up the best beach-front property. Most Chinese activity is outside the US, with Tencent and Alibaba building vast constellations of satellites. Tencent has more than 600 investments, while Alibaba has around 400 — totals that almost make Japan’s SoftBank look like a penny-pinching slowpoke. Critics of this approach may gripe that it is undisciplined, but the admirers argue that these investments are somewhat akin to Chinese premier Xi Jinping’s ambitious and far-reaching Belt and Road Initiative. The only US company that comes close is Google, which since the start of 2017 has made more than 100 investments, although they are heavily concentrated in the US. It has also purchased more than 80 companies outright since 2014. Another transpacific difference involves the use of cash. Between 2015 and 2017, the five biggest US tech groups (especially Apple and Microsoft) spent $228bn on stock buybacks and dividends, Bloomberg data shows. During the same period, the top five Chinese tech companies spent just $10.7bn and ploughed the rest of their excess cash into investments that broaden their footprint and influence. It’s hard to escape the view that the Chinese groups are — like all of us — creatures of their heritage. They are using their investments as one way to help fulfil the ancient Chinese definition of the Middle Kingdom — as the centre around which all else revolves. The writer is a partner of Sequoia Capital. The views expressed are his own and he may own shares in companies mentioned

Proven 8y ago

Statist nonsense! As expected from the socialists at the FT.... China is a Ponzi society, completely hopeless.

vthallam 8y ago

I know this article is more about tech companies, but China is winning everywhere. They have started a very ambitious OBOR to connect Europe, Africa and Asia. The Chinese investments in Europe is just mind boggling [0] and the infrastructure projects by the Chinese Govt are spread across the whole Asia, Africa and Europe. Unlike the USA which offers support and aid by offering money to other countries, the Chinese loan tons of money to build infrastructure and it is so much that the small countries will not be able to pay and literally submit to the Chinese. [1] [0] - https://www.bloomberg.com/graphics/2018-china-business-in-europe/ https://www.bloomberg.com/graphics/2018-china-business-in-eu... [1] - https://www.nytimes.com/2017/12/12/world/asia/sri-lanka-china-port.html https://www.nytimes.com/2017/12/12/world/asia/sri-lanka-chin...

mc32 8y ago
Kind of a United Fruit model of economic investing which resulted in the pejorative banana republic and resulting cries of American Imperialism, and subsequent loss in economic growth as AmCos pulled out due to instability. Wonder if they can avoid a similar fate. Maybe people are wiser on both sides, one can hope.
- mywittyname 8y ago
  My impression is that much of this "instability" was largely the result of American military/intelligence intervention that came in response to the local government seizure and nationalization of these industries.
  - mc32 8y ago
    Superficially maybe. My impression is most of the instability was countries with govts with too weak an effort to transition from an agricultural society to a goods and services centered one, this resulted in an ill advised call for land redistribution and other unrest rather than making education necessary for all kids. Even now many illegal manual labor immigrants to the US lack basic education.
chii 8y ago

jsadamsnyc 8y ago

They are winning more than the global tech race.. :(

whazor 8y ago

I believe China is too unbalanced in their IP protection in order to 'win the tech race'. They either have a monopoly that controls the market via Chinese gov, or there are no rules at all and everyone will backstab you. I believe that these conditions are unfavorable for true technological innovation.