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Comment by toss1 | Hacker News Reader

Samsung's $130 million investment over years, sold out to Chinese firms for $14 million.

To the Chinese, theft of IP is just business as usual.

Every single firm I've personally encountered that has done biz in China has either already had their IP stolen and sold in competition with it (or just products sold out the back door w/o label), or fully expects that it would happen and takes strong defensive strategies, e.g., sending pre-mixed materials to China where they only do the final process.

This is not sustainable. While the West thinks that we were exploiting China for it's cheap labor, the Chinese had a much longer range view -- they were exploiting our myopic lust for short-term profits to get our most valuable assets and gain long-term strategic advantage, both in both commercial and military technology.

This is likely to go down as one of history's greatest strategic blunders.

I wonder if it has already gone too far for us to recover.

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China has been playing the "international trade" game for longer than most western cultures have existed. To ever think that the US/etc were taking advantage of them, was naive at best.

China knows exactly what they're doing.

Who seriously thought the US was taking advantage of China?

The WTO riots in Seattle were partly because this was an obviously dumb strategy that sold out the well-being of the public for the enrichment of a few elites.

Those WTO protests/riots happened exactly 19 years ago today.

Which historically is what the USA did regarding European ipr in the nineteenth century.

And Europe did to China in the seventeenth and eighteenth century. Wedgewood porcelain and Sevres...

What you said regarding US stealing IP from Europe is true.

But that doesn't mean we shouldn't take defensive measure. Do defend our IP because that's our self-interest. Don't do it with the moral pretense.

True. I don't for a minute mean there are no consequences here. I'm

You are what

...bad at saving edits?

I'm fully aware the actions require a response

> But that doesn't mean we shouldn't take defensive measure.

It just means that defensive measures will not be successful.

Given the markets in the 17 and 18th centuries weren't as vibrant and open as today, and the amount of technology stolen by the Chinese today, compared to the amount "stolen" by Europeans back then, this comparison is plain disingenuous.

Edit: expanding: the technology wasn't stolen in the same sense as today, because the Chinese couldn't not wanted to export and sell the technology back to the West. But US/Europe today are getting their IP stolen, and immediately sold to them. That's the asymmetry.

Oh certainly, the scale is significantly different. I think that the rei-ification of IPR just isn't understood the same way culturally, the "crime" is not taken in the same sense the effect on Chinese economy and polity is taken. Much the same as the Russians for much of the 20th century: must catch up is like a joker card mentality. Except of course as long as you steal IPR, you can't catch up in real sense.

That's right. The long-term trend will be in the direction of China playing by club rules. When China is a fully developed nation, its brands are valuable overseas and its own technology is superior in many markets. Then it'll be in China's interest to enforce global trading rules.

Right now it's in transition.

Things move faster(fortunately) but the effect is similar. Any small invention in the past had huge effects on history. Europens won over the indigenious people because of the technology. It was not very advanced but good enough to change history. If the chinesse were not so...communist I wouldn't really say it's a bad thing in the big picture.

Do you see a difference between one person learning a process inside and out, and reproducing it elsewhere, versus the work product of thousands of engineers being stolen, far more information than a single human could ever possibly know? The former is like watching a chef work and seeing how he cooks a beef Wellington and doing it yourself, whereas the latter is like just taking his whole recipe set.

Recipes aren't protected by IP laws, which is a good thing, because if they were, food would be worse.

There's a lesson there.

Is it "don't read too closely into analogies"?

No. It's "IP protection is mostly a racket at this point, and instead of promoting research & development, it often slows it down".

How do you know?

I don't, really.

Sure, cutting-edge intellectual property these days is more complicated and unlikely to be completely and fully understood by a single person. That's a function of the progress of technology.

I don't see how one person, or one country, stealing IP via memorization (the technology of the 1800s) is meaningfully different from someone stealing IP on a USB stick (the technology of today).

It's not about the method of theft, it's about the cost of the thing being stolen.

When people decide to send ideas to be turned into things in China, what's being removed is labour value: it's too expensive to make something in the USA, compared to China.

The cost of labour and compliance with health and safety is the main factor.

Is it surprising the Chinese industrialist looks at the rate of profit for these goods sold in the USA and tries to copy them, and secure some of that gap between cost (of production) and price?

So now, thinking like a US consumer, which is better? The iPhone sold by Steve jobs, or the cheaper phone with stolen IPR? What if the stolen IPR is totally ephemeral and only about the GUI?

I think you're misunderstanding the pre-industrial-revolution world's attitude to trade secrets. "Learning a process inside and out, and reproducing it elsewhere" was not allowed, at least for high-value processes.

An example from within Europe: http://www.muranoglass.com/en/news-en/ten-facts-you-did-not-...

And I also suspect you're not understanding the relative value of those processes (glass, tea, porcelain, etc) to the economy of those areas vs the current relative value of the "product of thousands of engineers".

Don't forget silk. For 3,000 years it was a complete mystery to China's trading partners. Even that it came from lavae was not known by most. Korea was the first to appropriate Chinese sericulture technology.

The biggest irony here is that Samsung used to be known for stealing Western and Japanese technology.

> While the West thinks that we were exploiting China for it's cheap labor, the Chinese had a much longer range view

You're describing it like it was a planned action. Is there any reason to describe it like that rather than exploiting an easy opportunity?

Consider that their govt calendar is primarily organized around 5-year plans, that they apparently have 100-year plans (and possibly even longer), and have many long-term plans such as the 'belt and road initiative'.

Even if they didn't originally conceive of it as a plan before Nixon/Kissinger's 'opening' (i.e., the original opportunity sort of fell into their lap), we can be quite sure that once they recognized the opportunity, they have made very careful long term plans to exploit it.

We can also observe that these plans are being diligently executed now.

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