This has been an interesting conversation. I found it particularly interesting that my communication came across as disrespectful to the Chinese.
Few people that I've met have any real world experience with contract manufacturing. Of the ones I do, they have mostly dealt with Chinese manufacturers, although I do know one person who worked with a Japanese contract manufacturer and one with a Vietnamese factory. Everyone who has ever asked me about this I point to Bunnie's "Made in China" blog entries [1]. Which convey the challenges and rewards of taking manufacturing to China much more clearly than I ever could.
That said, people who have had experiences with contract manufacturing in China have all had a very similar experience, that experience was that the contract manufacturers have an exquisite expertise in squeezing costs out of manufacturing through creative techniques, not specifically disallowed by the contract. Bunnie writes about this at length in his blog.
The thing here is the law of large numbers. There are so many contract manufacturers, and their business is so competitive, the ones who develop this expertise survive and the ones who don't, they don't survive because nobody accepts their bids. It is important to understand that they are this way because they are good at what they do, not for any negative reason.
It is this exact asymmetry of information which I expect befell the hotel in its attempt to have "cool programmed light switches and TVs." This mechanism, which many people who have used contract manufacturers have experienced, is that an inadequate specifications on the final product can give the manufacturer room to economize on their costs, which increases their profit, and also increases the chance that the bidder will be around for the next bid.
And it is the large number of Chinese contract manufacturers, the ease with which they can be located and contacted via Alibaba or other web sites, that means so many people have had a chance to experience this effect first hand with them. Using Chinese manufacturers as an example of the challenge in my post was my way to communicate what I was talking about in a way that folks who might look this up could find additional resources discussing this challenge (and they would probably find Bunnie's blog too).
The leap here, was to take what I wrote and assume that I said, or believed that because something was made in China, is was cheap.
That was not what I said, and certainly not what I meant. But a mix of people have both read it both ways. So it certainly could have been written more clearly.
I really do recommend Bunnie's blog. Everyone should understand the challenges of working with contract manufacturers, regardless of their nationality. Not tightly specifying a contract (and worse not knowing how to tightly specify a contract) will create situations like the one with the Android controlled light switches.
[1] http://www.bunniestudios.com/blog/?cat=7