From Gongkai to Open Source (2014)
bunniestudios.com
bunniestudios.com
http://www.bunniestudios.com/blog/?tag=gongkai
http://www.bunniestudios.com/blog/?p=4018
http://www.bunniestudios.com/blog/?p=284
http://www.bunniestudios.com/blog/?p=147 (I've been there. It's overwhelming.)
This submission turns out to be a dupe of https://news.ycombinator.com/item?id=8807651.
Url changed from http://gizmodo.com/why-its-easier-to-innovate-in-china-than-..., which points to this, and 2014 added.
This is, however, a natural outcome of the Shanzhai culture. For the life of me I cannot find it now, but there is a fascinating article (by a well-known sci-fi author, I think... William Gibson? Neal Stephenson?) about Shanzhai, aspects of which TFA alludes to. It gives very good insights into the pros and cons of the culture of sharing that underlies today's Chinese tech industry. While one of the pros was the dizzying array of remixes it produces, one of the cons was that it essentially removes the incentive to invest in expensive R&D. While China is very good at the former, the West is still where the latter happens, and I tend to attribute this to the different cultural attitudes regarding IP.
Regarding the references to fair use and reverse engineering, there may be a lot of FUD out there and TFA helps in dispelling some of that, but there is no shortage of reversing in industry today. Companies regularly reverse their competitors' products, either to ferret out technical secrets or to detect infringement of their own IP. IANAL, but with few exceptions (like those clauses in the DMCA regarding DRM-related mechanisms), IP laws do not forbid prevent reverse engineering per se. Generally it's only when you leverage the knowledge gained from reversing in a commercial product that you can get into trouble.
Look at what Tencent did with QQ and WeChat, the kind of feature experiment they run on a monthly basis alone is mind boggling.
Look at what Kuaidi and Didi did to work WITH the taxi industry and be profitable, instead of fighting against the taxi industry head on like Uber is trying to do.
These kind of "soft" innovations are just as important as "hard" innovations such as a new processor design. In fact these kind of innovations are more interesting to me because they are very often not predictable and nobody has a solid "roadmap for business model", unless hard, tech roadmaps.
Right. That's the problem. He wants to steal someone else's technology and resell it. What he means by "innovate" is "add some tiny feature to someone else's thing."
What the article talks about is that these technologies are forkable in China. The author wanted to do no more than what is already possible. And it leads to an interesting discussion about IP law and practice between the West and China. As well as a very interesting technical discussion about a specific technology that was investigated.
Wanting to treat it like software and market economy in such a situation makes sense. I'm for limiting the effect of patents to the lifecycle their functionality represents. For instance, an improvement for version 12 is protected until version 13 is released. Maybe add some time. Long-term stuff, like fundamental techs, get more protection. Current system just kills innovation by every measure I've seen or locks it into oligopolies. There's exceptions here and there that are small players making it. Mostly just anti-competitive.
" What he means by "innovate" is "add some tiny feature to someone else's thing.""
That's most innovation: rehashes of and improvements on existing stuff. Theirs sounds like straight up using something but even inventing it yourself is a violation if a patent maybe covers it. Still need heavy-hitting lawyers or consult tons of patents per commit/algorithm. Seems impossible. Even big boys don't bother to do that: they just collect their own patents and use them as leverage for potential countersuits. Whole model is broken for startups in such industries if not looking to be sued or acquired.
So, for crap like this, I tell them to copy away because that's what the pro-patent competition are doing too. Out of necessity. Pay what you have to, esp what's justified (real innovation). Otherwise, don't give a shit and stay out of U.S. if extra worried. I've known many in HW business (esp ASIC's) that do that.
What I meant is if you're going to compare IP ecosystems you need to be honest. The "Chinese network IP ecosystem" is not a closed loop as the diagram suggests but is heavily subsidized by innovations from outside of that system.
Start your company in China, fine. You'll move to a western country eventually, if you get big enough, and China doesn't reform. You simply can't trust a society where the laws don't apply equally. There isn't an Apple, Google, or Microsoft coming out of China. Instead, you get Ali Baba and Weibo that clone American startups.
I won't consider China a threat to American innovation until they get a true rule of law, democracy, and intellectual property rights. This is a tall order that won't be fulfilled anytime soon.
- I would not consider Taobao a clone.
- The US has its advantages but also its disadvantages. Funding (e.g. SBIR grants) is very corrupt in the US (corrupt in the Latin sense, meaning not necessary meaning bribes but personal relationships. I could tell stories, Lordy Lord).
- "true rule of law" The true rule of law is a question of money in the states. For the average citizen the law has become more a risk than an asset.
http://www.amazon.com/Three-Felonies-Day-Target-Innocent/dp/...
Rule of law is very strong in the U.S.; but ya you need to afford a lawyer. In contrast, a lawyer cannot help you much in China if the government has already made up its mind. The level of dysfunctions in either system differ by an order of magnitude.
What makes you think that?
VC is always based on guanxi, sure, but banks will only lend to SOEs or big private companies, there isn't much credit for small private companies.
Banks' prefer to lend to SOEs or larger companies, sure, and those customers get the best rates. Credit _is_ available from banks for smaller businesses, but banks' role in this lending is a little different than in the US/UK.
A bank making a small business loan in the UK is serving two functions: (i) providing capital, (ii) taking on credit risk. In China, many small business loans are granted by banks (and live on a bank's balance sheet), but the credit risk is taken on by a credit guarantee company.[0][1]
The small business will pay interest to the bank, and fees to the guarantee company.
"there isn't much credit for small private companies"
There is, it's just that (i) when banks lend money sourced from their wealth management products (理财产品) , it doesn't show up on banks' balance sheets, and (ii) there are other non-bank lenders.
Search for 'wenzhou rate', 'shadow banking' or 'china wealth management' if you're interested in more detail, e.g. see the 'wealth management' section of this paper[2].
[0] http://www.ft.com/cms/s/0/2653ed8e-21a2-11e0-9e3b-00144feab4...
[1] http://www.wsj.com/articles/next-up-for-chinas-central-bank-...
[2] http://journals.sub.uni-hamburg.de/giga/jcca/article/viewFil...
On the other hand: Often you get money from non VCs and VC is not very in the nature of a true Chinese. Chinese prefer M&A (with the focus on the A). How much is it to buy everything? They don't want any long term partner and they want everything based in China.