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Beijing is Silicon Valley's only true competitor

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Re: Beijing is Silicon Valley's only true competitor

#71

Post by dilemma »

mapt wrote: post #48
seanmcdirmid wrote: post #7

Spend 3 weeks in China, and maybe it is clear that it is, but spend 8 years in China, and it is overwhelming clear that it is not. > Yes, they clone where they can. But cloning is starting to reach its max — there are just not enough successful ideas to clone. In addition, clones often fail in the local market due to different consumer behavior and needs. China is still fairly closed, startups here in Beijing are 99%…

I am not a trans-Pacific entrepreneur, so take this with a grain of salt. From what I can tell, China's most fundamental problem is that it's taken an inherently protectionist stance on large businesses and investment, one which is completely incompatible with the sort of business done in Silicon Valley, which requires heavy international cooperation, recruiting, business mobility, and fluid investment, as well as th…

> As it was explained to me... If you want to do business in China and you're not a citizen, you damn-well need to find one to start a Chinese business which can transact with you formally. If you want to scale your business and you don't have a midlevel member of the Communist Party running your HR department, you damn-well need to find one who can drink baijiu with the right people. If you want to scale your business to large enterprise levels and you don't have enough bribes in the right pockets to be part of the Chinese economic planning process, you damn-well need to get there; You might not be the first to do so, even if you try.

This is a fishing story.

> Don't do these things, and the rug will be yanked out from under you every which way possible, from licenses to immigration to financing to every sort of red tape. The Chinese Communist Party may have liberalized its way into a functioning domestic economy, but it's not willing to take its central planning thumb off the scale or permit full capitalist investment without political influence. The consequences of this mentality extend beyond tolerable levels - if the central plan is that this new startup BaoJao is the greatest thing ever, why would they permit your competitor to try and defeat it? The default stance is doubt about you and your enterprise, particularly if you represent foreign involvement.

This is a conspiracy theory.

Re: Beijing is Silicon Valley's only true competitor

#72

Post by dilemma »

seanmcdirmid wrote: post #7

Spend 3 weeks in China, and maybe it is clear that it is, but spend 8 years in China, and it is overwhelming clear that it is not. > Yes, they clone where they can. But cloning is starting to reach its max — there are just not enough successful ideas to clone. In addition, clones often fail in the local market due to different consumer behavior and needs. China is still fairly closed, startups here in Beijing are 99%…

I work at a Shenzhen startup that is global first and doing very well. I know a couple of other companies here that are too, and are opening offices abroad. They're all hardware, and that may count for the difference as the environment in Shenzhen for developing physical products is unique.

Re: Beijing is Silicon Valley's only true competitor

#73

Post by seanmcdirmid »

Hondor wrote: post #21
seanmcdirmid wrote: post #7

Spend 3 weeks in China, and maybe it is clear that it is, but spend 8 years in China, and it is overwhelming clear that it is not. > Yes, they clone where they can. But cloning is starting to reach its max — there are just not enough successful ideas to clone. In addition, clones often fail in the local market due to different consumer behavior and needs. China is still fairly closed, startups here in Beijing are 99%…

It's not clear if many of these things are good or bad or if they're any worse than silicon valley. I wouldn't count any of them as serious obstacles for Beijing tech success. Focused on the local market. I often run into SV companies that I'd like to use as a customer but can't because they only serve America. Either because of IP restrictions, money transfer, shipping, or they just haven't figured out other countri…

> Focused on the local market. I often run into SV companies that I'd like to use as a customer but can't because they only serve America. Either because of IP restrictions, money transfer, shipping, or they just haven't figured out other countries yet.

Most (all?) of the companies to succeed in SV have been successful internationally. How many countries does didi serve vs. Uber, wechat vs. whatsapp, Google vs. Baidu. Startups graduate in China without any global reach, at all. A market of 1.3 billion vs. 6.5 billion.

> Having people in it for the money is a sign that something's really happening. It's not just hobbyists doing it for fun. I'm sure most SV startups are in it for the money too. Nobody really things a pick-up laundry service for rich people is altruistic or fun.

I guess it's a cultural difference. I can't imagine doing work just for the money. Many in SV love the chase, even the subject, it is their passion at the paycheck is just a bonus. In China, few people have at luxury, just like soccer or basketball players play for country glory, not for fun, so it shouldn't be a surprise that China has yet to grow winning teams.

> Young smart engineers getting management responsibilities. Sounds like every startup with a 25 year old CEO.

Even that 25 yro CEO can benefit from having a seasoned engineer. In the west, you can go pretty far as an individual contributor...being more valuable to the company than your people manager for example; in China it seems like everyone wants to get into management as soon as possible, that being an IC last 40 is a failure.

> Lack of good leadership? Maybe they're effectively doing flatter organization structures. That's a cool trend in SV.

Confucian culture loves hierarchy, flat isn't a thing here.

> High cost of living. SV is famous for its wildly inflated house prices but that's not stopping it.

It didn't start out like that in the 70s. Also, how many Americans or even non-Chinese are looking to buy property in Beijing vs. Chinese looking to buy property in sillicon valley. One is completely insular, the other is crazily international.

> Bad internet: Crippling if you're a foreigner and depend on foreign services. Hardly noticeable for locals using Chinese services. American's equally have no access to major Chinese internet services because of the language barrier yet that isolation isn't stopping them.

All great until you need to do work, even as a Chinese. Try finding factual information about cancer using Baidu alone. Want to do a search on google scholar? Tough luck, the world is limited to China.

> Underhanded business practices. America has patent lawsuits which a big company can use to stomp out pretty much any small software company they want. Everyone's infringing somebody's patent but they mostly survive because they're too small to matter.

The courts get to sort it out in the west, in China you might just hire some thugs, or at least some hackers or officials, to teach your competitors a lesson. Rule of law has its benefits as well as drawbacks.

> Long hours and no time for family. SpaceX is famous for that and they're doing pretty well.

At least it isn't a pure face thing And they have a tangible productivity increase to show for it. In China, it's all about the face.

Re: Beijing is Silicon Valley's only true competitor

#74

Post by seanmcdirmid »

ximeng wrote: post #39
seanmcdirmid wrote: post #7

Spend 3 weeks in China, and maybe it is clear that it is, but spend 8 years in China, and it is overwhelming clear that it is not. > Yes, they clone where they can. But cloning is starting to reach its max — there are just not enough successful ideas to clone. In addition, clones often fail in the local market due to different consumer behavior and needs. China is still fairly closed, startups here in Beijing are 99%…

WeChat payments seem like genuine improvements. But agree it's going to be very challenging for these companies to expand overseas. Perhaps still easier for China to expand outside its borders than outside companies expanding to China.

That window is closing quickly. If Chinese companies can't even expand to its own backyard, even in Chinese speaking markets outside of the mainland, what chance do they have in the rest of the world?

Re: Beijing is Silicon Valley's only true competitor

#75

Post by seanp2k2 »

uola wrote: post #66
api wrote: post #8

Earlier quoted context omitted.

I've been told that the great firewall is actually more about protectionism than censorship. They know they can't really contain information, but they can block or degrade foreign services to favor their own. Of course this does serve a state censorship and surveillance agenda indirectly since home grown services can be more easily controlled. As much as I can't stand Trump and could never vote for him, I do think he…

Europe has done pretty much everything the US wants, from spying on our citizens to foreign companies paying little to no tax. All you hear these days is how lame Europe is because we don't have a Facebook and how we should all move to the overpriced small town of SV. China doesn't only have a Facebook, it has a Google, an Amazon and an Uber. Which are in many ways surpassing their US counterparts. Since when was tra…

Agreed that it's overpriced in terms of real estate, but I wouldn't call it small; the Bay Area is home to over 7 million: https://en.m.wikipedia.org/wiki/San_Francisco_Bay_Area

The weather is also pretty nice in the South Bay (over 300 days of sunshine according to Wikipedia for San Jose). San Francisco technically gets a lot of sun, but anecdotally they get a lot of fog and shade as well, especially in certain areas of the city. There are other benefits to Left Coast living as well, but the rent is indeed high.

Re: Beijing is Silicon Valley's only true competitor

#76

Post by chw9e »

argonaut wrote: post #62
chw9e wrote: post #56

Earlier quoted context omitted.

Chinese social media and search platforms employee loads of people to only censor information. If any of the Western companies tried to match the level of censorship required it would dramatically increase costs of operation. If Facebook or Google agreed to censor their content to the degree that Chinese companies do, I believe they could operate in China. Google and Facebook claim to be morally opposed to censoring…

1. You're conveniently ignoring the fact that Google did self-censor from 2005 to 2009. So the idea that it's "too expensive" being the reason is just FUD. Unsubstantiated speculation. 2. The question about whether or not Facebook/Google will succeed today is more misdirection. The real question is whether Google would have succeeded 11 years ago, and whether Facebook would have succeeded 7-8 years ago, because that'…

I don't think that fact disputes my argument. Let's consider a few assumptions to try to see a more well-rounded view of the firewall problem. Consider for a moment that all domestic firms must comply with self-censorship or be forced offline (see Papi Jiang's recent problems with cursing in her programming and being forced offline). From this we can assume that censorship issues are not only an issue for foreign firms, but also a primary concern for domestic companies. If we accept these assumptions, then censorship is just a market condition in China, the same way that bad infrastructure or government instability are market conditions in some countries. The difference is that through the internet, foreign companies can escape this market condition and still compete with domestic firms. Whereas in a country with poor infrastructure all companies are subject to the market condition. Without a firewall, domestic firms would be at a severe disadvantage because foreign companies would be able to easily escape government discipline.

Now, under these assumptions we can consider the Google case. Google tried to compete under these market conditions and lost. Thus, if we accept that the firewall is a way of the Chinese government extending market conditions to force fair competition, then any argument that Google could have beaten Baidu in the Chinese market is wrong.

Of course, this assumption may not be correct, but unless you work in the Chinese internet bureau it is not possible know the motivations behind the firewall. I'm simply presenting a devil's advocate view.

Re: Beijing is Silicon Valley's only true competitor

#77

Post by TeMPOraL »

argonaut wrote: post #68
sangnoir wrote: post #67

Earlier quoted context omitted.

> What's important is the degree of protectionism The US complaining about China's protectionism is hypocritical. Let's talk about America's farm subsidies. How is that not competing unfairly? It leads to American agricultural produce being dumped on foreign markets at subsidized prices, destroying entire countries' agricultural base. What would you say is the degree of protectionism here?

I'll just repeat my extremely short comment: > pointing out examples of a nation engaging in protectionism contributes little to the discussion unless you compare it to other nations.

It's being implicitly compared to China, and well, to everyone else.

Re: Beijing is Silicon Valley's only true competitor

#78

Post by seanmcdirmid »

dilemma wrote: post #72
seanmcdirmid wrote: post #7

Spend 3 weeks in China, and maybe it is clear that it is, but spend 8 years in China, and it is overwhelming clear that it is not. > Yes, they clone where they can. But cloning is starting to reach its max — there are just not enough successful ideas to clone. In addition, clones often fail in the local market due to different consumer behavior and needs. China is still fairly closed, startups here in Beijing are 99%…

I work at a Shenzhen startup that is global first and doing very well. I know a couple of other companies here that are too, and are opening offices abroad. They're all hardware, and that may count for the difference as the environment in Shenzhen for developing physical products is unique.

I think Shenzhen has more of a shot at being China's SV than Beijing. For one thing, it has good proximity to HK, and much less interference from the central government. They also have Tencent, it isn't all, hardware. Otherwise, maybe hangzhou (alibaba) or Shanghai (everything), but not Beijing...it is too close to the emporerer.

Re: Beijing is Silicon Valley's only true competitor

#79

Post by dschiptsov »

uola wrote: post #58
iveqy wrote: post #28

Actually, if we count unicorn companies per capita, the number two after silicon valley is stockholm. http://www.forbes.com/sites/knowledgewharton/2015/11/11/how-...

Stockholm has produced a few successful startups, but it's not a competitor to SV. It's is a global competitor in telecom systems and games (though I guess many game companies are now owned by US companies). Spotify is basically the same service as when it started, just with more users. Stockholm has no real momentum in building something of their own.

There is a huge difference between the valley - home of the whole industry and Stockholm, which hosts a few niched companies.

Compare the hiring. In Sweden there is no demand for CS skills, there is no immigration programs for techies, etc.

Also, which is also important, Sweden is traditionally a consumer of technology, not producer (with exception of Ericsson, of course) - MS land where Linux is frowned upon outside academia and almost nonexistent in the market.

There is not even a dim analogy to what is going on in the valley.

Re: Beijing is Silicon Valley's only true competitor

#80

Post by Supi-lee »

I am pretty sure India would be building its own devices, OSes , search engines, social networks etc if the govt gets more protectionist. There is no reason this can't happen overnight.

It has an endless supply of cheap labor and high end talent.

It (protectionism) has worked well for them in the auto, pharma, telecom sectors where the local companies are market leaders despite serious competition from the west.

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