Slashdot Mirror
Chinese Intellectual Property Acquisition Tactics Exposed
hackingbear writes "In an interview published in Sina.com.cn, Chinese rail engineers gave a detailed account of the history, motivation, and technologies behind the Chinese high-speed rail system. More interestingly, they blatantly revealed the strategies and tactics used in acquiring high-speed rail tech from foreign companies (Google translation of Chinese original). At the beginning, China developed its own high-speed rail system known as the Chinese Star, which achieved a test speed of 320km/h; but the system was not considered reliable or stable enough for operation. So China decided to import the technologies. The leaders instructed, 'The goal of the project is to boost our economy, not theirs.' A key strategy employed is divide-and-conquer: by dividing up the technologies of the system and importing multiple different technologies across different companies, it ensures no single country or company has total control. 'What we do is to exchange market for technologies. The negotiation was led by the Ministry of Railway [against industry alliances of the exporting countries]. This uniform executive power gave China huge advantage in negotiations,' said Wu Junrong, 'If we don't give in, they have no choice. They all want a piece of our huge high speed rail project.' For example, [Chinese locomotive train] CRH2 is based on Japanese tech, CRH3 on German tech, and CRH5 on French tech, all retrofit for Chinese rail standards. Another strategy is buy-to-build. The first three trains were imported as a whole; the second three were assembled with imported parts; subsequent trains contain more and more Chinese made parts."
I worked for a high tech company where the Chinese just seized the imported equipment outright and stopped payments. No doubt everything was duplicated and what software wasn't already transferred was reverse engineered. Posting anon...
Step back for a second and look at what's happening.
On one hand, the companies giving up their seed corn aren't being forced to literally at gun point. They're deciding that at this moment, they're better living another day and starving tomorrow. So in a sense it's a win-win scenario.
On the other hand, the enterprise benefiting from this exploits government backing to take a longer term view of the transaction than the companies developing the technology can afford. So in a different it's not a win/win scenario; it's a win/minimize-your-losses proposition.
So China wins here not by being more ingenious or creating new knowledge or technology, but by exploiting its ability to control the rules of the game. If you twist your vision enough, I suppose that what it is doing in this case might look like innovation.
China is a nation with tremendous human resources and ingenuity, but it *also* exploits the fact that it is the only major economic power on earth still pursuing a kind of mercantilist trade policy.
Post may contain irony: discontinue use if experiencing mood swings, nausea or elevated blood pressure.
intellectual property IS a joke. as you can see, the chinese have proven to you what a joke it is. the way to fight the chinese is to only do business with them and only allow their business into your country, as long as their business abides by certain standards, such as worker's rights. supporting intellectual property is not an effective strategy
furthermore, intellectual property is a concept that the chinese will just as happily wield against those in the west when their power is entrenched enough. the very idea of intellectual property is exactly the sort of anti-capitalist rent seeking monopolistic practices autocratic corporations like the chinese government engage in, that should be opposed, in the NAME OF capitalism and free markets
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
It is more than just savvy business wheeling and dealing, since it's the Chinese government wheeling and dealing. Which means it's a monopoly: only the government agency can negotiate for that business inside China. And only the specific Chinese corps the government picks can get the business. Those picked corps are picked not necessarily for the best interests of China, but rather for whatever is in the best interest of the government officials with the power to pick them. Which might or might not be the best interests of China. That's Communism.
But it's also industrial policy, which is indeed savvy business wheeling and dealing. The US doesn't have anything like that, except for the corruption part where some industries have orgs that lobby our government to do business with foreign governments that require their government to mediate such international trade, or where the US government does occasionally require our government to play that role in foreign trade, where the orgs use some method other than competitive bids/RFPs to pick which members get the business. The US could have an industrial policy as effective in strategy as China's extreme one, but without requiring the government to actually conduct the negotiations. Just review the completed deals to ensure they comply with the policy, perhaps just random samples plus any over a large value threshold (which would pay in taxes enough to fund the review).
Instead, the US abandons industrial policy, and therefore industrial strategy. And watches China ascend at our expense. Though the top US capitalists have already invested in China's industries, so China's gain is their gain, while they've divested from US liabilities, so our expense is not theirs.
--
make install -not war
That couldn't happen, it's bribery by a foreign power! It would be just like President Ford getting a large donation for the Republican Party in person in Jakarta on the day Indonesia invaded East Timor, and the USA reversing their policy on East Timor on that day, even calling them (the same party that runs East Timor today) Communists! Oh wait. When the papers were released in 2005 we found out that was EXACTLY what happened.
Time to start learning Mandarin.
Ridiculous. The negative side of China's rise to power is not the color of their skin, but the dismissal of human rights by their federal government.
Comment removed based on user account deletion
I recall a Marxist argument that the key difference between Europe and China in the period was that in Europe, the bourgeoisie succeeded in resisting the aristocracy and winning a measure of independence -- chartered towns and so forth -- whereas in China, the aristocracy succeeded in keeping the bourgeoisie subordinate. The unsettling implication is that if a ruling class is too powerful, it can enforce stagnation, to the detriment of everyone.
The Marxist interpretation implies that in the present, you need to establish the independence of the working class from all other classes; of course, it's hard to miss that an alternate interpretation is that the independence of the bourgeoisie is the critical issue.
The funny thing is that the Chinese government already considers itself in a competitive "war" with you, and has done for several decades. They will do whatever it takes to "win", primarily for nationalistic reasons (they certainly don't do it for the ordinary citizen, although it is sold as that). Just because you didn't notice it doesn't mean they weren't thinking in those terms. This is quite different to the US where the government funds innovation itself rather than a systematic program of stealing (corporations are trans-national and another thing entirely).