Chinese CEO Says "Free" Is the Right Price For Mobile Software

hackingbear writes Sheng Fu, CEO of Cheetah Mobile, a public Chinese mobile software company you probably haven't heard of, but whose products are among the top downloaded products in Android markets around the world, said that the intense competition of the Chinese market leads to products that can compete globally. Many recent university graduates are working in tech, all with their startups looking to find their place in the market, he said. Chinese companies saw the impact that piracy played in the PC software era, and China's mobile companies grew up knowing they would need to make money without getting consumers to open their wallets. "Chinese companies are so good at making free but high-quality products," he said. Sounds like we have a good race to the bottom.

Comments

Profit?

[link-error]

That only seems to work when the government is paying you to install spyware.

Re:Profit?

[Rosyna]

How are they earning a profit? If the apps are free, where do they get the money? If it's from ads, then that doesn't count as free.

Re:Profit?

[SourceFrog]

Google pays Android OEMs a percentage of the huge 30% cut it takes from their app store for apps. So by generating intense competition amongst app developers, what Google and the mobile companies (and their OEM partners) are effectively doing is forcing app developers to subsidize the operating system and mobile phone development - most app developers have been driven to such low margins that many are losing money (Google and the OEMs etc. get the lion's share of profits that used to go to software developers, by establishing app stores as effectively a software distribution (middleman) cartel based business model). Sheng Fu seems proud of the fact they've done this - actually it's nothing to be proud of, as it's doing a lot of harm to software developers.

Re:Profit?

[donscarletti]

I'm the CTO in a Chinese technology company. The government has never paid us to install spyware or anything else for that matter. In fact, the government just cares about 1) blood not being too red, 2) gambling not being too overt 3) users not being able to use words equivalent to "fuck" or "cunt" in English, names of prominent politicians or particular terms in reference to disagreements with neighboring countries, 4) characters being in simplified and not traditional script. 5) under 18 not playing video games for more than 4 hours per day.

Beyond that, they don't give a shit.

Westerners often revere the Chinese government as being some all knowing all powerful being with a profound understanding of technology and deeply nuanced plans that span decades, roughly in the same way they view their own government. Fact is, the Chinese government is interested in keeping its people more-or-less satisfied with the status quo, just like your own government is. Chinese old people with too much free time to cause trouble get their panties in a knot about sex drugs and violence and "young people these days", so that's what the Chinese authorities crack down on. They simply do not have the time or inclination to be bothered with who you are and what you are doing.

Think about the last time you interacted with your own government. Did they know who you are? Did they know what your life circumstances were? I'll wager they didn't know shit about who you are and why you were there, nor did they care, they just wanted you to either shut up and go away or pay your tax and go away. Now imagine that level of caring, divide that by 1000, that's how much foreign governments gives a shit about you. Your own government couldn't even be bothered installing spyware on your computer, why would the Chinese government?

When you're right, you're right.

[BarbaraHudson]

I've been saying that the gold rush for mobile development is ended, but that's been met with derision and unbelief. Cost is always an important factor.

Beta tapes cost more than VHS: VHS, though inferior, won.
Early Apple computers cost more than early PCs. PCs won.

There are plenty more examples where people will settle for cheap over expensive. Apps are just another one - once people are in the habit of not paying for an app, you'd better be in the top 0.1% of apps to justify getting paid.

Can somebody direct me to some examples?

[bogaboga]

"Chinese companies are so good at making free but high-quality products," ...

If these companies are so good, where are some of their "high-quality" products?

Free Chinese stuff?

[JeffOwl]

I don't know about spyware, but with apps at least you don't have to worry about lead or melamine.