Technology, the Chinese way

Tom Sangala February 6, 2019

385 1 minute read

With Marshal John Mdeza:

First it was ZTE that found itself in the jaws of USA trade law; the company’s US branch had allegedly exported telecommunication equipment to north Korea and Iran, two countries ‘nursing’ a US trade embargo. Washington did the expected; finned ZTE $1.19 billion and issued a decree to USA component suppliers of TZE not to do business with the company.

ZTE was also ordered not to export any of their smartphones and other technology products from USA for seven years. Surprisingly, the department of Trade rescinded its decision claiming that ZTE had cooperated. The truth of the matter was that Beijing had most probably intervened.

This time around, another Chinese technology company, Huawei, has found itself in a similar predicament as ZTE. Huawei, as it seems, will also get away with it. Why? Read on.

The USA now knows that no matter how much she tries to squeeze life out of the Chinese technology companies, the Chinese companies will not die. Companies like Huawei and ZTE are sacred cows in China; the Chinese government is ever ready to bail out these companies any time they are squeezed by external forces.

Fighting Tecno, ZTE, Huawei, Xiaomi or OnePlus is as good as fighting mother China. Is USA ready for such battles? Obviously not now. Don’t forget, iPhone, the technology flag carrier of the USA is assembled in China.

China is a country on mission; to become a technology super-power. You need not open your eyes any wider to notice that; when it comes to technology usage, the Chinese jealously guard their innovations. iPhone and Samsung Galaxy S-series may be the best phones anywhere in the world, but not in China.

In terms of social media, WhatsApp and Facebook are the kings worldwide, not in China; they have their own. When you are in China, the social media language is YouChat.

What is the best search engine? Google, of course. Well, not in China. Actually Google, until recently, was banned in China. The company has been told to fine-tune the search engine the Chinese way if the company wanted to have presence there.

Does the Chinese market matter after all for iPhones and Samsungs? Unfortunately yes. Currently, there is a growing low demand for smartphones globally because people want to keep their phones for longer these days. However, this trend has not affected Chinese smartphone manufacturers. Companies like Huawei and Xiaomi are recording impressive sales figures and growth.

What does this mean? If a smartphone cannot impress the Chinese market it is most likely not going to excite the rest of the world. The Chinese mantra seems to be “make an iPhone at half the cost it takes Apple to”.

The problem is that, sometimes very successful companies, like Apple and Samsung suffer from an interesting dilemma where things seem too fine to notice changing dynamics; it is has a name, innovator’s dilemma. I rest my case, my lord.