Shenzhen, China: Tech-Life Without the Burden of Copyright Law

Ni Hao! (Greetings) from mainland, China. I'm in a bustling metropolis called, Shenzhen which was a fishing village and assorted vegetable patches until about 20 years ago. (Shenzhen is just across from Hong Kong.) I'm staying at the Marco Polo Shenzhen. A hotel that defines the term "five star" by any measure. Shenzhen is a completely modern city. As far as I can tell, it has no past, just a bright future. The middle class extends for a hundred miles in every direction and the Nuevo-riche conspicuously consume.

Gas prices here are about mid 2's per gallon and everyone has at least one car. Busy households have two. In Shenzhen it's 1963 and the industrial age is just transitioning to the space age. Except in one very specific area: consumer electronics. Everyone here has a cell phone, an mp3 and mp4 player and maybe even a laptop. My experience here so far has been an up close personal view of tech-life without the burden of copyright law.

Below is a picture of the iBox. It's a $250 toy that is the Swiss Army Knife of personal electronics. It will teach you Chinese (which is more important here than you think), it will also store your songs, movies and games. It's a calculator, currency translator and dictionary. It also has a WiFi interface and a 3GPP phone interface. To purchase this device, all you need is the money to buy it, which everyone here seems to have. This is only one of literally hundreds of devices like it that are readily available here in China.

All of this begs the question, "What can you sell in China?" It's a good question. I was at the largest music store in China yesterday afternoon. There were more than 200,000 titles on display. The store featured the largest collection of classical and symphonic music I have ever seen. It had a fair amount of traditional Chinese music and some new, popular music by Chinese artists. To be honest, the store was devoid of customers. I spent time with the store manager and she was more forthcoming than I imagined she could be. "Everyone downloads everything. They don't have to buy it here." Looking at over 200,000 sku's it's a sobering thought. This is communist China, there's no P&L manager here. So this store gets a free pass. American counterparts will not fare as well.

In another part of the city, I visited what you and I would think of as a "Blockbuster." Again, there were few customers, but almost every American title you could think of was on the shelves.

Visiting a Starbucks or a McDonald's you immediately understand that the Chinese are just learning about our take-out culture. You may think that Chinese restaurants invented take-out in the States, but here in China, where lunch or dinner can easily last for three hours, the idea of fast food is relatively new. People are seated at Starbucks, shown a menu and served at their tables. Obviously, it's a process.

Although they may be playing catch-up culturally, from a technology perspective, everyone here is 10 years ahead of everyone I know back home. PDA's and cell phones have capabilities that approach laptop prowess and people just know how to use them. It's like living in a weird episode of Star Trek. People have two and three devices with them at all times. It's really hard to get used to.

Tomorrow, I will attend the opening ceremonies of a massive Cultural Fair here in Shenzhen. Everyone from Tea merchants to Cinema and Video content producers are going to be here hawking their wares. I'm looking forward to learning more about this emerging marketplace. There's opportunity here in Pirate Bay, but as a content producer, it is unclear how one might extract some wealth from the process.

Shelly Palmer is Managing Director of Advanced Media Ventures Group LLC and the author of Television Disrupted: The Transition from Network to Networked TV (2006, Focal Press). Shelly is also President of the National Academy of Television Arts & Sciences, NY (the organization that bestows the coveted Emmy® Awards). He is the Vice-Chairman of the National Academy of Media Arts & Sciences an organization dedicated to education and leadership in the areas of technology, media and entertainment. Palmer also oversees the Advanced Media Technology Emmy® Awards which honors outstanding achievements in the science and technology of advanced media. You can read Shelly's blog here. Shelly can be reached at [e-mail]

Comments

[kusalarhetoric]

Thank you for this informative and entertaining stroll through Shenzen! Under the theory that the more the place has changed since the almost twenty years when I was there, the more things are plus c'est la meme chose, my observations then might be pertinent. Not only is learning Chinese instrumental, learning the local language of your interlocutor breeds a familiarity that allows for exchanges which more closely approximate the honesty requisite for a successful business deal.

Then, the Taiwanese were the most successful, and I attributed their success to their tenacity in negotiations. There is a saying about China that business proceeds according to connections, and this is often taken to mean guanxi is only about having friends, but it seems to also mean having the ability, power, and will to enforce business dealings if the other side does not behave. My shorthand way for expressing this is too infelicitous to reproduce here, but if you parse those words carefully you'll get the drift. Throwing down in the Chinese market requires a great deal of commitment.

With regard to content, licensing in India seems most humane: relatively inexpensive but official versions of US originated content is available for purchase on reliable media. Importing that to China would perhaps be profitable. It worked before with another commodity, which was also a medium of exchange.

[FalconerHK]

Agreed. As a content producer, I have strong feelings in both directions. I think that if we had sane copyright laws (as we did pre-DMCA) people would be more inclined to comply. When restrictions are so complicated and cumbersome it's easier to ditch them altogether than attempt any sort of compliance - like why can't I stream the DVD I bought from one computer to another or play the song I bought in my car and on my iPod without buying multiple copies? I think the movie-music industry brought some of this on themselves.

Having said that, piracy is piracy. Copying and selling DVDs etc. is tacky and will ultimately hold China's technical and entertainment markets back as there is little incentive for content producers (software included) to innovate in that market only to see their products ripped off the moment they're released with no consequence.

My round-about point is that there should be a happy median there somewhere.

[BobLablah]

China ROCKS because it has given us low cost items to buy at Wal-Mart, which also rocks. Anyone who is against China or Wal-Mart is against America.

[Overd0g]

Theft certainly lowers the price on things.

[DrewDruncan]

That matches my observations exactly - I was there for about 8 weeks last year. You can not appreaciate the giddy, capitalistic bender that South China is on until you see it first hand. It is true that could buy any PC software imaginable, at almost any retail establishment from grocery store to department store, for 13RMB (under $2). You could also smoke in a cafe, It is the 60's. Overall , I found it enjoyable and encouraging, despite the obvious problems.