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Comment by EZ-E | Hacker News Reader

Tim Cook wasn't invited for his beliefs, but to give face to the Chinese government.

Chinese internet is as closed as it gets. Any foreign company eating up the market share of a local company will get blocked eventually or be forced into merging into a local entity.

For now it really is open in one way : Chinese companies are welcome to compete in the whole world, but China won't let you be a competitor of the local companies

Cook is "forced" into this monkey dance because he's deeply entrenched into the Chinese market. He only has little leverage : the jobs he creates in China and the money he makes there.

He has to comply to local laws, even though it interferes with his own point of view because lots of money is at stake. He can't say it in this conference

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> He has to comply to local laws, even though it interferes with his own point of view because lots of money is at stake. He can't say it in this conference

Isn’t it the same reason why most of the corrupt people do what they do. There is a lot of money on stake for them and they decide to close their eyes on the corruption around them and actively participate in that vehicle.

Cook is doing exactly the same, he is putting money in front of his moral principles.

If he is so vocal about freedom or whatever, he should take a stand and do something at least in his own company, if his board or investors are pressuring him - he should quit or do something about it, because right now - whatever he says about fighting for freedom is just a complete farce.

If you're looking to public for-profit corporations to, of their own volition, take some sort of ethical stand, you're going to be disappointed more often than not.

Agreed. We should expect governments to take ethical stands not for profit companies that only care about profit. Unfortunately western governments are also being totally hypocritical when it comes to China.

Hypocracy is a bikeshedding dimension. China and the US both serve the politically-connected first and the people last; China does it by force and the US does it by manufacturing consent. Regardless of political system, the people must rise up and demand a fair government and insist on sensible regulations and justice with eternal vigilance. Power never cedes anything without a fight.

I think it's getting carried away to say there's no different. The US isn't quite what we'd like it to be, but you will not be kidnapped and charged with a trumped up crime for running a book store that sells books critical of the United States government. Noam Chomsky remains a free man.

Companies only care for profit inasmuch we allow them to do so.

A couple laws would deal with the problem quite rapidly but we first need to get this social-darwinistic neoliberal ideology out of our collective arses...

What are the proposed "couple laws" that could help here?

I fail to imagine how laws can convince a profit-maximizing entity to stop behaving like profit-maximizing entity.

Well, just off the top of my head - IANAL not an economist - but it would suffice to change by law the set of stakeholders that have a legal say on the company and you’re done.

Yeah! For example, the government could become a stakeholder in all companies to ensure that the populace's interest is taken into account in addition to profit... wait a second, that's what China's doing

I don't know how practical that is as a solution to social ills, but whether China is doing it or not doesn't really make it good or bad.

Yes, that's true. What I wanted to point out is that a good idea in theory can quickly turn into an instrument that's being used for other purposes.

China is a great example to be studied in this regard. Their changes do indeed ensure that profit will only be one of several considerations for company policies in China; this will undoubtedly result in more consumer-friendly corporate behavior, but it also tightens central control and is likely to deepen the kind of censorship measures that I personally would not want to wish on any person or company.

Letting all people (of a given country) have a say means involving the government in which the company's headquarters are located. I'd rather not have national[istic] interests working from within companies, I feel laws and regulations are better suited to get a fair & transparent outcome.

The German model that the sibling comment brought up is quite sane in comparison. It limits the stakeholders to only those who actively participate in production, which provides a kind of decentralization enforced by laws, but not directly steered by central interests. In terms of overall benefit to society, it's hard to argue against that model and it has served the Germans well. (However, it's also worth noting that having unions sit on the board doesn't prevent the company from making unfavorable decisions outside of the limited national and workplace-environment-related interest of the extra stakeholders, and often those changes can only be deferred / slowed down but not outright avoided.)

I am not sure. I think the problem there is that the Chinese government is actively involved in enterprises, like censorship, that most of us would agree the government shouldn't be doing. I don't think it's anything inherent to the idea of fully or partially state-run enterprises (especially when you consider how many services have been degraded upon being privatized).

Yeah, why not... corporate has a powerful influence in the Government's decisions about the populace's interests, I don't see why not formally establish reciprocity.

Besides, in Germany Unions such as IG Metal _do_ sit on the Board.

> jpetso: Yeah! For example, the government could become a stakeholder in all companies to ensure that the populace's interest is taken into account in addition to profit... wait a second, that's what China's doing

What kind of stupidity is this? The Chinese government is an authoritarian oligarchy and doesn't give two shits about "ensuring the populace's interest." It cares about maintaining its power and control.

I think you need to cleanse yourself of your free-market straw men. It's not a bad idea for there to be more stakeholders in control of companies than just the shareholders. For instance, you could split the board between shareholders, employees, and customer representatives. That's not a radical idea either. IIRC, German unions have long had seats on their employer's board of directors, see:

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

You act as though business is this totally seperate thing to life. Business is some fancy legal words wrapped around the activities of groups of people. Saying businesses are only driven by profit is not fundamentally different from saying "employees and shareholders of Apple are greedy people who put personal gain over the moral principles of our society"

It's a practical point of view, not theory of society. It's great when companies put morals over profits, but they generally don't - companies don't gain much from being good and don't lose much from being evil; the impact is not big enough to offset the importance of being effective on the market. Companies that fail to be effective get outcompeted and die.

In the shorter term they are likely to face pressure from investors if they're doing something like taking a stand that shuts them out of a huge market like China.

Organizational dynamics frequently lead to organizations behaving in a way that their members probably would not conduct themselves in their personal lives.

"When we work on making our devices accessible by the blind, I don't consider the bloody" return on investment, Cook said.

http://www.businessinsider.com/apple-ceo-tim-cook-companies-...

Ultimately of course, these things do have a return, even just in PR. How Apple operates in China has some effect on its US sales and market position... so I guess Tim has to play a careful game.

It's easy to not consider ROI when one's talking about investment with non-negative gains strictly under your control. If you have money to spare, making your devices accessible will not reduce your profits, and there's a chance it'll increase them.

OTOH, pissing off China could mean huge losses for Apple, and that makes it a different story altogether.

Exactly. Even if Cook stands up for his (or our) ideals, the pressure China is going to apply to Apple will result in Cook getting ousted by the board, replaced by a favorable "Cook".

Companies (for profit or not) answer to their major stockholders. Even politics in a (democratic) country (EU or U.S. or X, place possibly your country where X) follow a similar mechanism: politicians conform with the wishes of the major coalitions that will keep them in power. Sure one can leave footprints of their ideals, but after some threshold they are intrinsically bound by their power base (usually lobbying).

I think the point many people are making is that "I will be replaced by someone willing to do this morally reprehensible job" is not an excuse for doing the job yourself, as that 1) increases the pool of people who are willing to do the job and allows more bad things to happen and 2) as people are not purely replaceable, it isn't clear that the Board of Apple will be in a good place to find someone as competent at supply chains as Tim Cook to replace him... particularly someone who is both competent and willing to play with China.

Is a sarcastic way of framing this then: he is taking from the Chinese and giving it to the blind?

Cook realized that his board or shareholders would fire him for getting Apple locked out the Chinese market (both for sales but also for the manufacturing). Not an easy position to be in.

> Cook realized that his board or shareholders would fire him for getting Apple locked out the Chinese market (both for sales but also for the manufacturing). Not an easy position to be in.

They could conceivably diversify their manufacturing base, but that's a longer term strategy. Given Apple's reputation for control, it's conceivable that they're not as dependent on the Shenzhen ecosystem as your typical manufacturer. It doesn't have to be domestic US production, just not China.

thanks for pointing the obvious!

Now you are going to say that the world is also full of criminals?

oh my god! who would have thought?

It doesn't seem to be that obvious to everyone.

Which is why I find a joke to force employees to do some kind of company values training, with certification, because in the end they get thrown out the window the moment the money sings, regardless of how noble they state "better loose a deal that give up on the values".

Thats the wrong way to look at it - Its not that value training stops the world from being as it is.

Instead imagine a world without even the lip service necessary for value training.

In other words consider an unfettered race to the bottom.

So we shouldn't hold anyone accountable? Just give up?

Yesterday Hackernews talked about how Apple was just focused on making money and they should ignore any moral implications, today we are supposed to feel compassion and understanding for poor Tim Cook? It just sounds like everyone has Apple as their idol and they can't do any wrong.

  So we shouldn't hold anyone accountable? Just give up?

What's needed here is a coalition.

If N companies pulled out of China and it didn't liberalise, they've incurred a cost for no benefit. If N+1 pulled out and it did trigger China to liberalise, they'd benefit from doing it.

The trick is finding the N+1 companies and convincing them they're enough to be the trigger.

I mean it's probably more effective to make it more painful for them not to act than to act.

> If N companies pulled out of China and it didn't liberalise, they've incurred a cost for no benefit. If N+1 pulled out and it did trigger China to liberalise, they'd benefit from doing it.

> The trick is finding the N+1 companies and convincing them they're enough to be the trigger.

It seems like China has been pretty successful at preventing the actual dependence on foreign companies needed for that strategy to have its indented effect. For instance, if Apple pulls out, Chinese who can afford an iPhone are just going to have to settle for a Huawei.

The only chance I see is a general reduction in trade or foreign-driven manufacturing hurting the overall Chinese economy, but that would take a lot of companies to accomplish.

https://9to5mac.com/2017/05/23/iphone-market-share-gartner-q...

The funny thing is, not doing this is just kicking the can down the road. Chinese companies with their protected access to the gigantic and prosperous Chinese market, will eventually be "good enough" to crush all others, across virtually all markets.

We can, but you end up as signal within a vast amount of noise (Gandhi's "first they ignore you" phase isn't always passed).

If you eventually do get contact it will end up with a kind of theatrical act where we are acting that they should care and are being heard, and the CEO may end up acting as if he does care. Perhaps even with more than mere actions.

Maybe he even cares as a human being (if he doesn't -> psychopath), but with his CEO hat on he certainly does not.

> Maybe he even cares as a human being (if he doesn't -> psychopath), but with his CEO hat on he certainly does not.

Aren't CEOs and managers even trained to think that way in business school? For instance the "shareholder value maximization" idea, which teaches the sole responsibility of a corporation is to make the most money it can for its shareholders, and damn everything else.

That's a problem the Chinese have managed to avoid, even if it's been in a corrupt way. It seems like they make the local companies prioritize the policy objectives of the authoritarian government ahead of absolutely maximizing the profit interests of their shareholders.

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

It's less straightforward than you're letting on.

China is slowly, slowly liberalizing. The trendline is towards more civic freedom, less inhumane practices. If they started to do something destabilizing or genocidal, that is the time to pull out.

Not really. If anything it's the opposite. They're clamping down on Hong Kong ahead of schedule and Xi is going in a more authoritarian direction. I think China is actually demonstrating the fallacy of our idea that as a country develops it has to become a liberal democracy.

Yeah, they played the West. The Communists got what they wanted (technology transfer), while keeping everything firmly under their control.

> I think China is actually demonstrating the fallacy of our idea that as a country develops it has to become a liberal democracy.

I don't think that's necessarily been proven a fallacy, the idea that liberalizing China would be simple and automatic certainly has been. The Chinese Communists aren't stupid: they've been carefully studying things like post-Communist Russia and the Arab Spring in order to avoid mistakes that might cause them to lose power. If China liberalizes, it will take a unique path that the Communists probably couldn't see.

Things in China are dramatically better than they were 30 years ago. Yes they played the west wrt techology, and we should have hit back harder after Nortel got nailed, but overall Chinese people are more knowledgeable about the world around them and their middle class would never put up with the types of things that Mao got away with. Harmonizing HK with the rest of Chinese policies doesn't really change my mind.

Economically things have been liberalized. Politically they have not. This has worked out OK for a lot of people (although it must be said others have been left behind), but it is not really the model people predicted for China.

China is officially the largest national economy after the United States. Seems like a lot of development has already happened.

Were you responding to a different comment? I was writing about political development, not economic.

Then what political development do you mean?

I'm just saying that there is always this idea that companies will do the right thing out of the kindness of their hearts when in reality they usually need to be compelled to do so. That's why, for instance, they passed the Foreign Corrupt Practices Act instead of kindly asking companies to stop bribing foreign governments (not that that is bulletproof.

That's because corporations don't have volition and don't take actions. People in them do. And the responsibility remains with those individual people.

As long as there is a correlation between reputation and profits, there is leverage to shame them into behaving properly.

> Cook is doing exactly the same, he is putting money in front of his moral principles.

Put it this way, if Tim Cook acted the other way as you wanted, he simply wouldn’t be CEO anymore; the board would have him promptly removed. You can’t head up a public company and leave that much money on the ground.

Didn't Google leave China a few years back, doing exactly that?

Google left because their main business is collecting information about people to sell them ads later, China did not allow that - thats why they left, they did not leave because of their great moral stand.

Any source about China not allowing collecting information?

That isn’t true at all. First, China allows collecting similar info about people as in the west, and all the Chinese internet companies do it probably more aggressively than their international counterparts. Second, google left china (search market) because the Chinese government was hacking gmail accounts to root out dissidents.

Google left because China hacked them: https://www.google.com/search?q=china+google+hack

you mean the company named google that literally pay no tax to countries where it is making big $? check news, countries like UK and Australia were forced to come up with google tax to fight such criminal offences.

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

Any source to back up this claim that China wouldn't allow that? I find it hard to believe.

Google was getting their butt kicked by Chinese competitors, namely Baidu. They weren't exactly making tons of money anyway. So they gracefully did a PR move and pulled out of China.

Google surely wasn’t as good as Baidu in scamming terminal cancer patients with the help of the PLA.

Going by that logic, it should even be more easier for Apple to leave China. They are also getting their butts kicked by the local Chinese firms.

Apple makes a lot of money in china. Much much more than local Chinese mobile phone producers. Huawei might sell more phones than Apple, but their margins are slim to negative.

I wonder how many CEOs Apple could run through before the damage to their image hurts the bottom line more than not appeasing to the Chinese government.

Of course we'll only find out if multiple people individually discover their backbones and forgo personal profit to take a moral stand, and I don't think that'll happen anytime soon.

You are assuming most people care what Apple does in china, and I can garauntee you they do not. I’m a china critic myself and I’ve seen lots of stuff working for Microsoft there. Let’s be realistic: if consumers judged Apple for what they did in china, then something might change, but beyond a very small fringe, that doesn’t happen.

Then he should not tell other's how to fight for freedom and accept free "expression awards" for his human rights advancements [1], if he can't lead by example being scared that his ass will be on fire. And remember, he has only money to lose, so he puts money above his beliefs.

[1] - https://www.youtube.com/watch?v=YDFyuPxAkqE

It’s not his money to lose, it’s Apple shareholders’.

I think I'm getting tired of the word "shareholder" most of all.... if companies make all these greed-driven decisions because of them, let's do away with holding shares. (Lots of further thought to be had there.)

Put it this way, do you want Tim Cook making idealistic decisions with your retirement savings? Do you mind losing 80% of it because you don’t want them doing business in china anymore?

> Put it this way, do you want Tim Cook making idealistic decisions with your retirement savings? Do you mind losing 80% of it because you don’t want them doing business in china anymore?

That settles it then: dystopian miasma it is! Can't let morality or ethics stand in the way of a small number of my dollars[1].

[1] Your 80% figure is totally bullshit. Only an idiot has 80% of his savings in Apple stock and Apple does not do 80% of its business in China. It has manufacturing elsewhere and so much cash that I'm sure it could quickly ramp up whatever production capacity it needs wherever it needs it.

Again, it isn’t his money. It isn’t his savings, it’s yours. People are all high and mighty about other people’s money, but shut up when it’s their own.

Apple doesn’t care so much about making stuff in china as it does sells stuff. It is their second biggest market, quickly becoming its first, and is very profitable. Taking china out of Apple would remove probably 50%+ of its market cap, Cook would be put in an insane asylum by his board very quickly.

> Again, it isn’t his money. It isn’t his savings, it’s yours. People are all high and mighty about other people’s money, but shut up when it’s their own.

Again, ownership and stewardship of money isn't the highest good, and shouldn't be the compass that we use to guide all of our moral and ethical decisions (checked only by bare-minimum legal compliance).

Your logic is the same kind of reasoning that could easily be used to justify abusive sweatshops, child labor, and worse.

You also assume too much: some of this money is my own, though that's irrelevant. I'll be high and mighty about anyone's money if it's being used to prop up something unjust.

How does one determine should or shouldn't? If we are looking at the factors that Cook will actually be judged upon that he cares about, which is his ability to make money for Apple shareholders, then he is doing the right thing. He is lying, but in doing so is gaining positive PR which increases people's opinion of Apple and thus their willingness to buy it. This is what he should be doing.

Yes, the problem is far beyond Cook and it is systemic. People with no investment in the actual work, culture, employees, or purpose of the company (the board and shareholders) are the ones with control over the business. This fundamental disconnect between the people with power and the people who actually do any real work (called capitalism) pushes companies to behave more and more monstrously with no repercussions because "well that's just how it is" -- but that doesn't have to be how it is. Would google employees vote to help authoritarians crackdown on the people in China? I doubt it.

except that his job is precisely only to make money for his company

That's a very lazy excuse for something.

Also, his job is to preside the company. That involves keeping manpower happy and productive. Keeping public opinion in check. And also, making a profit.

True, but he has taken personal stances in the past while representing Apple the company. If you believe that the only role he has is to make money for his company, then you have to disregard his previous personal statements as nothing but PR. He can't have it both ways.

So you're saying Tim Cook should throw away whatever leverage he has to change these things in order to appear valorous?

Maybe what Cook has said about freedom is a complete farce. Maybe it isn't. Taking a stand against the Chinese government might win him points on HN, but not with the Chinese government. And at the end of the day, they make the call on whether they'll tear down the wall or close the gates.

If he's not willing to "throw [them] away", and the Chinese know that, they aren't leverage.

I didn't say how much leverage he had. Though whatever privacy focused technology they manage to get away with under the watchful eye of the party is still a win on the freedoms front. End-to-end encrypted imessage, secure enclave, etc. And he still gets to consort with the Chinese to whatever degree he is able to.

The only reason Cook would be vocal about being a freedom fighter is when its in his interests as CEO of Apple. Cook is a servant of the shareholders; not the US public or Chinese public. Their goal is to increase Apple's profit margins & volume ("profit"), not to increase liberty among the US, or spread liberty across the world. He's CEO of Apple, not chairman of Amnesty International.

I don't understand why people keep confusing the two as if CEOs are some kind of philanthropists. They're not. They're egocentric maniacs who represent their big business. That's what they're trained for, and what they're good at. See also the documentary The Corporation. IMDB's summary [1]: "Documentary that looks at the concept of the corporation throughout recent history up to its present-day dominance." or Metacritic's summary [2] "This feature documentary analyzes the very nature of the corporate institution, its impacts on our planet, and what people are doing in response."

Also interesting is the correlation between CEOs and psychopaths [3].

[1] http://www.imdb.com/title/tt0379225/

[2] http://www.metacritic.com/movie/the-corporation

[3] http://time.com/32647/which-professions-have-the-most-psycho...

I think people confuse the two because of the perceived doublespeak. In general, people accept that a CEO's responsibilities are to the shareholders, no arguments there. I think the disconnect comes from speaking publicly about the importance of freedoms but then complying with Chinese censorship. If you're going to comply, which they have every right to do as a business, don't provide lip service about the importance of openness and freedom of information, individuals, etc.

It is simpler to think of anything said by a CEO as being a complete farce. They are doing what makes the share holders money, and if they aren't, they won't be a CEO for long. They'll be exceptions, but the accuracy rate may be at tolerable rates without accounting for them.

China is just playing with the short term vision that is so foolishly characteristic of western companies. The Chinese know that CEOs need growth prospects for the next quarter, even though their actions are impairing the company in the long run. Of course, whatever money they make in China will be at the expenses of their long term IP, technology and market share.

TLDR; Cook said “The theme of this conference — developing a digital economy for openness and shared benefits — is a vision we at Apple share,” Cook said, in widely reported remarks. “We are proud to have worked alongside many of our partners in China to help build a community that will join a common future in cyberspace.”

To me it looks like Cook is telling a kid who is being bad "thanks for putting in effort and let me work with you to be good". You can interpret this in many ways.

>He has to comply to local laws, even though it interferes with his own point of view because lots of money is at stake.

He has to? What are you saying here?

What good does it do for him to be very good and have a very righteous point of view, if he does not actually do anything about it. Then sure, sign me the fuck up. I'm such a good person I would even, oh I don't know, I would even sell everything I own and give it to the poor. Unless you actually ask me to do that, in which case I will say "I can't do that, that would cost me a lot of money". But hey, it's the thought that counts, I'm still a good guy!

In short, bullshit on that whole argument. He has no principles. Just like any other private company, his one objective is maximising profit. Moral considerations don't enter in the capitalist framework.

> Cook is "forced" into this monkey dance because he's deeply entrenched into the Chinese market. He only has little leverage : the jobs he creates in China and the money he makes there.

> He has to comply to local laws, even though it interferes with his own point of view because lots of money is at stake. He can't say it in this conference

If this were the case, then he could just not show up. I think the lack of principle here ideally should be reflected in their revenues, but somebody has to convince the public that buying in to Apple, is now the same as buying into in to the CPC.

Does nobody realize that the CPC has found a way to merge the two most sinister impositions, government censorship and social censorship, into one despair/tyranny manufacturing device?

So much for that theory about protectionism not working because other countries will retaliate in the same way. Apparently they won't if they're run by people that worship the free market.

> Chinese internet is as closed as it gets. Any foreign company eating up the market share of a local company will get blocked eventually or be forced into merging into a local entity.

> For now it really is open in one way : Chinese companies are welcome to compete in the whole world, but China won't let you be a competitor of the local companies

Not that Baidu has any foreign market-share, but this seems like something that should prompt a tit-for-tat trade-policy response, even if it's in another area of trade.

> even though it interferes with his own point of view

uhm, no? you're pushing what you want, what you hope his point of view is unto him.

however action talks more than words and as far as we know, as seen here, his point of view that money trumps morality and truthfulness and he'll say whatever his role at Apple demands him to say, both to government and customer, playing both sides for as long as people like you let him a free pass.

considering the heap of money Apple sits on they could just as well leave China. The WTO certainly doesn't hold much sway over China and saying Tim Cook is forced is nonsense, Apple is doing this for money and to hell with any "moral" positions they have, money comes first.

So either we accept that they are governed by the dollar or not. Their values only matter in countries where they can take a non risk stand.

What do you mean by 'leave China'?

Do you mean it stops selling its products in China? Or stop assembling iPhones in China? Or both?

According to this page (https://www.macworld.co.uk/feature/apple/where-are-apple-pro...), 'the assembly of Apple's devices is for the most part done in China'.

If Apple leaves China suddenly, I don't think it can build that large an assembly line quickly to satisfy the global demand of iPhones.

And according this document (https://www.apple.com/newsroom/pdfs/fy17-q4/Q4FY17DataSummar...), half of Apple's Q4 2017 revenue come from iPhone. So, if the supply of iPhones is greatly reduced, the cash Apple sits on will quickly run out. Then Apple will be in great trouble.

Building the actual assembly line is the least of their problems, it's just money and Apple has it by the truckload.

The bigger issue is finding enough skilled people for the factories, China is pretty much the only place in the world with enough trained workers in the scale that Apple needs them.

"Any foreign company eating up the market share of a local company will get blocked eventually or be forced into merging into a local entity."

Can you provide an example of a foreign company that was willing to comply with Chinese law, but still faced this outcome?

Facebook

Zuckerberg is all ready to comply and multiply his attempts to get closer to the Chinese government (look it up), but stays blocked.

The dude even learned Chinese (mandarin?).

It's so. much. worse.

http://www.worldtribune.com/archives/chinese-president-snubs...

https://www.quora.com/Did-Mark-Zuckerberg-really-ask-Xi-Jinp...

> In China this privilege is nominally given to the father or grandfather of the child. Asking a complete stranger, albeit a famous one to name your child is unheard of.

He even got his wife chinese didn't he ? (i know he met her previously)

Ew, cringe!

Which company's market share was Facebook 'eating up'?

Uber, WhatsApp

Wasn't Uber losing ton of money in China? Also they had problems with regulators and local governments. I thought that was the main reason why they left.

I think the "problems with regulators and local governments" part is the implementation of the "forced into merging into a local entity" effect the great grandparent comment referred to.

Ironically, while it may be part of the implementation in China, Uber also has "problems with regulators and local governments" in every single place they do business. I am surprised Uber even got the chance to try in China.

To be fair uber is losing a ton of money everywhere

Didi was also losing a ton of money in China. When they were competing head-to-head, both were offering ridiculous subsidies to both riders and drivers.

Uber lost the battle against didi, so was forced to merge with didi. Just a loser case.

WhatsApp never entered into China market, never register as a company in China, so how it could follow the regulation?

Yeah, but Didi has Jean Liu, daughter of Liu Chuanzhi who is founder of Lenovo. She helped Didi raise the largest fundraising round in history.

That's exactly the point for Uber: they lost against a local company, because the government did everything it could do so that didi would win the battle.

What did the government do?

I've used both Didi and Uber in China many many times, and it seemed like they were competing against each other pretty hard, without discounts etc.

From my perspective as a customer, it seemed like they were both just trying to outspend each other to gain market share, and Uber just decided it was no longer a good use of cash.

Being willing to comply with Chinese law is the catch to your question. Being willing to comply, means you're instantly put into a weak, disadvantaged state versus their domestic entities who get to play by an entirely different set of rules.

Disney can't even own their own park in China, they have to be a minority owner. So they build a nice, very expensive park, Disney Shanghai, and get 43% of it. That's the world's largest, most powerful media company, forced to beg on its knees just to get access to build in China. That tells you everything you need to know about how accessible China really is.

How's this for an example of how Chinese law works for outsiders? Jack Ma stealing tens of billions of dollars from Softbank and Yahoo, by taking Alipay away from Alibaba shareholders without proper compensation and without shareholder voting. He gave it to himself, discharging it out Alibaba and into his own hands, with complete disregard for what the ownership percentages were of Alibaba. It's one of the greatest thefts in world history, and these other large corporations were powerless to do anything about it. Ant Financial / Alipay of course is a critical piece of Chinese technological infrastructure, and is likely to go on to be worth a couple hundred billion dollars over time. For example this Wiki quote:

"In the fourth quarter of 2016, Alipay had a 54% share of China's $5.5 trillion mobile payment market"

That says it all about the extraordinarily vast scale of that theft. No chance China was ever going to allow Softbank and Yahoo to have such a big stake in that. So they looked the other way while Ma robbed the bank.

What outside technology company possibly trust being in business with Chinese tech companies on anything important or valuable to the Chinese economy after something like that? They'll just change or ignore the rules at will. I liken it to Jeff Bezos choosing to give himself most of AWS, discharge it out of Amazon.com's ownership structure, and not compensate the other Amazon shareholders for it. It'd be like Bill Gates granting himself Windows LLC, removing the product from Microsoft circa 1994 without shareholder compensation, and reaping tens of billions in additional gains that should have gone to Microsoft shareholders.

> That's the world's largest, most powerful media company, forced to beg on its knees just to get access to build in China.

Nobody is forcing them to build in China, disney just wants to make more money for themselves, so China can do whatever they want since it’s their land. If Disney agreed to this terms - it only means that it’s still profitable for Disney.

Of course China can do what they want with their country. You're standing up a point I wasn't challenging in the least.

The issue is: China is barely an accessible market for even the most powerful and largest of international corporations. Their rules for domestic entities are dramatically different than the rules for foreign entities, which is an intentional effort to restrict foreign competition and access to their economy. China wants to have its cake and eat it too.

Developed economies will increasingly shut down China's access in the same manner as China does, ending China's free ride. That process is already well underway with the US and Western Europe, as both have begun blocking China's ability to acquire local companies and technology. China will find it increasingly difficult to sell higher value products into the US and Western Europe (by far the two wealthiest economic regions on earth), restricting potential economic expansion for China.

It does seem like they have found a very effective "short term" strategy that will have a lot of trouble succeeding as their markets reach parity with ours.

Then again, maybe they're ok sacrificing long-term global growth to increase their domestic situation to something comparable to Europe or the US, at which point it won't hurt as much...

Wow, I had no idea Ant Financial was not part of Alibaba's main entity. Where can I learn more about this? I've done some work in China (even integrated Alipay/WeChat pay into an app) but had no idea this happened.

Check out Mark Kitto’s story for the ‘original’ example of this. To modify the original sentiment, it’s more like ‘any foreign company doing well in China will eventually be forced into a corner by unfair state aid to its competitors’

any company stupid enough to go to China and give up its intellectual properties deserves to die. 1.3B people?! let me get a piece of that. Oh, and let my stuff get copied and stolen, and I'll lose the US market and the entire world market, which is way bigger than the Chinese market.

We've banned this account for violating the site guidelines. Nationalistic rants aren't welcome here.

I really appreciate Tim Cook being very pragmatic and non-confrontational in China. We have great products and fierce competition. This in itself gives us much more freedom.

The last time a company did the opposite it literally caused death--Google quitting China led to Baidu's ruthless ads for fake hospitals, which claimed many many lives.

My (admittedly cursory) search on this shows that Baidu's "fake hospital" scandal seems to be a problem with Baidu, not with Google quitting China. Is there evidence to even suggest that if Google search were available in China at the time then people would not have died?

I can't offer an opinion on whether or not Google should have tried to maintain more presence in China, but the link between them leaving the market and some people believing dodgy search results from Baidu and basing their critical medical treatment on said results is spurious to say the least.

It's basic economics. Baidu is a monopoly in China's poorly regulated search market. Google before quitting had a market share of 33%. People would at least have had different results to check against Baidu's had Google stayed. Baidu's aggressive and dishonest false ads are closely--if not directly--connected to Google's quitting.

This has to be a troll comment. The logic of this post is ridiculous.

Sadly this is not. I'm surprised people don't get the basic economics at work here. More market=more freedom. That's why we're freer than the Mao-era without having the right to vote for anybody. It's the same logic.

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