White House Advisor Kudlow Says Apple Technology May Have Been 'Picked Off' by China (cnbc.com)

Fred Imbert, writing for CNBC: Larry Kudlow, director of the National Economic Council, said Friday that Apple's technology may have been stolen by the Chinese. "I don't want to surmise too much here, but Apple technology may have been picked off by China and now China is becoming very competitive with Apple. You've got to have rule of law," Kudlow said in an interview with Bloomberg. "There are some indications from China that they're looking at that, but we don't know that yet. There's no enforcement; there's nothing concrete." Kudlow's comments came shortly after China's Commerce Ministry said Chinese and U.S. officials will meet next week to discuss trade. Both countries have been engaged in a trade spat for months that has sent ripples through global markets. John Gruber at DaringFireball comments: I think what he's saying here is that the Chinese stole Apple technology, copied it, and are now flooding the Chinese market with phones based on that stolen tech. I'm 99.8 percent certain that hasn't happened -- if there were Chinese phones built with stolen Apple technology we'd know it because we'd see it.

Comments

Build something in a country

[spiritplumber]

and the people in that country will learn how to build it. Big surprise, right?

Re:Build something in a country

[ewhenn]

Being able to build things isn't the issue. That's fine. As is learning to design those things after building enough of them. That's fine too.

But if they have a contract in place that stipulates that the parts are to be built exclusively for the client and the designs are to remain confidential, there's a problem if they start building the parts for other clients (including themselves) or sharing the designs with anyone else.

To draw an analogy, it's fine if a contractor knows how to build homes. It's fine if they eventually learn how to design their own homes after building enough of them. But if your general contractor steals your custom home's blueprints and sells them to a developer who builds a neighborhood of copycat houses right next to yours, that's not fine.

I don't know what's being alleged here, but it seems evident to me that they aren't simply talking about China learning how to manufacture and design stuff on their own.

Yeah, except you left out the part where you know that contractor you just did a deal with has stolen designs from 50 other designers and you still decide to do business with them anyways, and then act surprised when they steal your design too. Gee, who would have guessed that would happen?!?

What technology, exactly?

[SuricouRaven]

Could he maybe offer some specifics? Exactly what is is that China is being accused of stealing? A claim this lacking in detail is suspiciously non-falsifiable.

Re:What technology, exactly?

[ath1901]

Oh, come on, how bad can it be? I know nothing about they guy but I'm sure he has some talents. Let's check Wikipedia:

https://en.wikipedia.org/wiki/...

Wow! That was hilarious! One ridiculous statement after the other. Best summed up by this paragraph:

In their 2015 book Superforecasting, University of Pennsylvania political scientist Philip E. Tetlock and Dan Gardner refer to Kudlow as a "consistently wrong" pundit, and use Kudlow's long record of failed predictions to clarify common mistakes that poor forecasters make

It's not Apple's technology

[Solandri]

Apple's phones use screens by Samsung or LG, RAM by SK Hynix, flash storage by Toshiba, cellular modem by Qualcomm, battery charger by TI, WiFi/Bluetooth by Murata, cameras by Sony, etc. The only parts Apple makes are the A10 processor and the software. Everything else is stuff made by other companies which anyone can buy to use in their own products. In that sense, aside from the processor and software, cloning an iPhone is relatively simple and does not require any theft of technology.

Also, the median income in China is 18,371 Yuan, or roughly $2,674 per year. You're kidding yourself if you believe the Chinese would be buying $1000 iPhones if it weren't for the availability of cheap knockoffs.

Re:How would you know

[magzteel]

About ten years ago I bought a Prada-labelled shoulder bag in Vietnam for $10 from a street vendor. When I got it back to NY I asked around and it sold for around $400. Not only is it indistinguishable from the real thing, it IS the real thing. It's what I call a "real fake." As described above, the factory gets an order for 5000 of these bags, makes 6000 and sells 1000 out the back door. There is no difference between those 1000 and the other 5000. Did this happen in China with iPhones? Has Apple complained about it? Because they would surely know.

I read a book some years ago on the many pitfalls of doing business in China. Issues raised included:

- Selling unauthorized overproduction runs as you described
- Making unauthorized changes to the product design or materials to make manufacturing cheaper. There were multiple cases cited where the product changes produced unsafe or defective products that cost the product owners dearly
- Duplicating the product under another label and competing with the original

The Chinese government has little incentive to crack down on such practices.

Re: Apple technology

[cypherthor]

Well.... Chinese companies are flooding the whole world with dirt cheap copies of apple devices. Every single device since 2006 has a Chinese look alike clone... down to the non standard screws on the casing of the 2011 MacBook Air. Itâ(TM)s just like what they are doing to all design companies from gucci to Bose to mevodo. I know some of you think design of devices is something you should be free to copy, but a lot of money spent hiring the best designers and making designs. Apple cant just change their design Willy nilly because the entire product line is consistent. Honestly, the way these Chinese companies are operating is predatory, I think they are making these devices at a loss... probably subsidized by the Chinese government so that apple goes out of business. These products should be banned from sale in US and Europe. If they copied the outside almost exactly, you donâ(TM)t think they copied the insides too? Same logic board design, same component sets... same .... need I go on? Those are you defending these practices and saying its consumer freedom... ask yourselves, what kind of freedom are you going to have when apple, google, sony, even samsung are gone and you have to buy Chinese government subsidized smartphones and computers? You think thinks will be as cheap as they are now? Want a hint... look at any industry that has been decimated by Chinese clones.