Internet technology in China is different!

Believe it or not, in many respects, Internet technology in China is different compared to that in the rest of the world. There is the great wall that basically blocks interaction into or out of China. There are the Internet business models and apps in China that some companies in the West are trying to […]

Believe it or not, in many respects, Internet technology in China is different compared to that in the rest of the world. There is the great wall that basically blocks interaction into or out of China.
There are the Internet business models and apps in China that some companies in the West are trying to copy, as China, in a sense, has learned from the master and gotten better than her in some respect. America still has its feet on the ground nonetheless, but the status-quo may not remain the same for too long. If in doubt, remember that everything in China is big, and the way things are shaping up, you can take that to the bank!
In a nutshell, for China, and unlike the rest of the world, the Internet is like an intranet – or a network contained within the great walls of the country, with everyone else blocked out. This great wall shields China from the rest of the world. Any foreign site that is not compatible with the ideology of the Communist Party and/or the government cannot control, gets blocked. So, there is no Facebook, Twitter, or Google in China. Obviously, this was not the intention of the US government, who funded the creation of the Internet, made it available free of charge to the world, and expects a flat (Internet) world without a boundary.
What fills the Internet vacuum in China is in some sense a generation of Chinese copycats that have now grown into massive companies. Instead of Google (in the rest of the world), it’s Baidu in China; instead of Youtube, it’s Youku, instead of Twitter, you have Weibo (or Sino Weibo), and instead of Amazon, what you’ve got is Alibaba’s Taobao.
Incidentally, the great wall is bidirectional – going out of China and coming into China, though the problem that a Chinese company that wants to operate outside of China faces may not be due entirely to Chinese government restrictions. As a consequence of the apparent inability to operate outside of China Chinese mega Internet companies like Alibaba, Tencent, and Baidu rely almost entirely on domestic businesses; deriving virtually all their revenues from China. Thus, predictions that Chinese Internet companies would challenge American giants internationally, hasn’t materialized. Some of the difficulties that the Chinese companies have in this regard include the language. Most people outside of greater China do not understand or speak Chinese or Mandarin, talk less of being able to read and write Chinese characters, which is what the default interface for the software from China has. Thus, except Chinese folks in the diaspora, virtually no one outside of China can transact in Chinese. Interface in English is now more common, but the business from outside of China is still very small in comparison.
The big Chinese Internet companies have been trying to solve the problem of having essentially only domestic portfolio. Tencent, the developer of WeChat tried. WeChat boasts of about 700 million users, most of whom are Chinese – locally in greater China or in the diaspora. In 2012, Tencent invested massively and aggressively into a project to expand into India, but the project failed. Paul Mozura (New York Times of 9 August 2016) explains the reasons for Tencent’s failure: “Critics pointed to Tencent’s lack of distinctive marketing, a record of censorship and surveillance in China and its late arrival to foreign markets. Yet the biggest problem was that outside of China, WeChat was just not the same. Within China, WeChat can be used to do almost everything, like pay bills, hail a taxi, book a doctor’s appointment, share photos and chat. Yet its ability to do that is dependent on other Chinese internet services that are limited outside the country.”
So, what do Chinese startups do to avoid being too local? They create separate companies outside of China and tap into the local culture. There are also plenty of acquisitions, wherein Taiwan is used as the intermediate hub between mainland China and the Western country – usually America.
After copying from the American companies, the Chinese giants are adding capabilities and contents that make their software more valuable than the ones they copied from. In fact some of these new features are so attractive that the Western companies are copying from the Chinese! A good example is Tencent’s WeChat, which does basically everything for you. It combines the functionalities of Facebook – social media, Uber – taxi-hailing app, Amazon – e-commerce, Instagram – video or photo sharing, Venmo, and Tinder – online dating app, plus other capabilities that the West does not even have apps for! (Venmo is a free digital wallet that lets you make and share payments with friends.)
Many companies in the West are now trying to replicate the “supper-apps” model from China. It’s amazing how diversity can work for the benefit of the human race.