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China Becoming Intellectual Property Powerhouse 140

eldavojohn writes "A lot of Westerners view China as little more than the world's factory manufacturing anything with little regard to patents, copyrights and trademarks. But it seems as far as patents go, China is moving on up. According to the WIPO, the company that applied for the most patents in 2008 was not an American or Japanese company but China's Huawei Technologies. And China has made astonishing ground recently moving up to third place with 203,257 patent applications behind Japan (500,000) and the United States (390,000). It remains to be seen if these patents applications will come to fruition for China but it is evident that they are focusing on a new image as a leader in research and development. The Korean article concentrates on 2008 but you can find 2009 statistics at the WIPO's report on China along with some statistics breaking down applications by industry."
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China Becoming Intellectual Property Powerhouse

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  • by danomac ( 1032160 ) on Wednesday October 06, 2010 @06:28PM (#33817862)
    Given that there's massive infringement over there (not just software or entertainment, physical as well) does that mean that they might actually start enforcing IP rights?

    That'll be interesting to see.
  • by Infonaut ( 96956 ) <> on Wednesday October 06, 2010 @07:02PM (#33818196) Homepage Journal
    Africa has been weathering the global downturn surprisingly well, and democracy is on the move across the continent. Ten years ago The Economist called Africa "The Hopeless Continent", but in a June, 2010 article they talk about the rise of entrepreneurs and better overall governance. If anything, this century may see Africa finally climbing out of the hole it's been in for so long.
  • Hmmm (Score:4, Interesting)

    by Anonymous Coward on Wednesday October 06, 2010 @07:08PM (#33818252)

    > China's Huawei Technologies
    Would that be the same Huawei Technologies that stole Cisco IOS code and who's rep was caught photographing chipboards of Cisco gear in the Cisco booth after hours?

  • Re:Probably Stolen (Score:5, Interesting)

    by Halo1 ( 136547 ) on Wednesday October 06, 2010 @07:12PM (#33818296)

    I agree. Last I heard, they only enforced IP rights when non-Chinese companies infringed (or appeared to infringe) upon a Chinese company's IP.

    Anyone know if China's still doing that? (with references)

    Where are your references that they actually did that?

    On a side note, several years back I attended a speech by David Martin, who is founder/CEO of the company M-CAM [], which is specialised in evaluating patent portfolios (such as determining how many claims overlap with other patents, likely validity etc). It was so interesting that I transcribed [] it. That page also contains the audio recording.

    One of the things he mentioned is that China has a requirement that whenever the state purchases technology from a foreign interest, all "IP" for enabling technologies and know-how must be transferred as well. Many Western companies figured the Chinese wouldn't know/comprehend the exact patent rights they gave to the Chinese, so they only transferred rights to second-rate patents that weren't worth the paper they weren't printed on (crappy patents don't only exist in the software world). Once the Chinese caught up with this practice,

    • Western companies suddenly started losing out on a lot of bids to large projects
    • the Chinese started closely scrutinising the patents supposedly held by these foreign companies

    It's easy to accuse the Chinese of "stealing" everything, but (just making up these numbers) what if 48% of what's supposedly stolen should actually have been transferred to them in the first place according to contractual obligations (nobody ever forced those companies to do business there if they didn't like the terms), 48% consists of bogus patents and the other 2% is simply the equivalent of the Nokia/Apple/Google/Microsoft/HTC/LG/... patent infringement lawsuits that you have in the US mobile industry (are all those companies "thieves", copycats etc)?

    I also think the "Probably stolen?" subject of this thread shows incredible ignorance. China probably has more engineering majors graduating every year than any other country in the world. Do you honestly think that the Chinese for some reason are inherently more stupid than us Westerners and cannot come up with anything innovative? Especially "innovative according to patent office standards"?

    As far as I can tell, they've simply learned the tricks of the trade. For decades, "intellectual property" allowed us to have the best of both worlds: cheap labor from China and nevertheless preventing them from making cheap knock-offs and importing those back into our territories (they could sell them over there, but nobody cared about that since nobody had any money so there was no real profit to be made anyway).

    Now they are starting to beat us at our own idiotic game. And still some people think they have the moral high ground and yell "but they steal everything from us, this cannot be". Wake up.

  • by Anonymous Coward on Wednesday October 06, 2010 @07:41PM (#33818520)
    Likewise how the motion picture industry set up shop in Hollywood [] to avoid Edison's patent claims. That's right kids, the whole reason we know the industry as "Hollywood" is because they themselves didn't believe in paying for intellectual property.
  • Re:Probably Stolen (Score:4, Interesting)

    by Nerdfest ( 867930 ) on Wednesday October 06, 2010 @07:47PM (#33818572)

    Do you honestly think that the Chinese for some reason are inherently more stupid than us Westerners and cannot come up with anything innovative? Especially "innovative according to patent office standards"?

    Stupid, no, but cultural differences do seem to have an effect on innovation. Cultures do change though, and the bar on 'innovation' is pretty low, especially in the software patent world. China will be able to hold their own in no time.

  • by c0lo ( 1497653 ) on Wednesday October 06, 2010 @08:26PM (#33818932)

    A really bad ugly un-fixable mess.

    As bad and ugly as it would be, the chinese are already [] there.

    China's investment in Africa has grown by as much as 30% annually, faster than in any other continent, from $1.6-billion in 2008 to $5.4-billion in 2009. About 2000 Chinese companies are engaged in 8000 projects in Africa, mainly in infrastructure and agriculture.

    And here [] you have some other numbers: "Beijing says its trade with Africa is on track to top $US100 billion ($A103.5 billion) this year" (this year means less than 3 months now, isn't it?)
    To put the things in perspective: in July 2009, US owed China 900+ billion [] (without counting the trade deficit with China) - 10% of money that US owes China will go into Africa in less than 3 month!?!

    For your survival: learn mandarin!

  • Let me help you, US. (Score:1, Interesting)

    by Anonymous Coward on Wednesday October 06, 2010 @08:39PM (#33819060)

    For all your good work on software patents, an useful link:


  • by Anonymous Coward on Wednesday October 06, 2010 @08:51PM (#33819164)

    When you owe a bank $100,000, you have a problem. When you owe a bank $100,000,000,000, the bank has a problem.

    If the U.S. ever decides to default on its loan to China and/or China decides to dump all its monopoly money reserves, China (more specifically, the Chinese government) will be feeling the pain far more than the U.S.

  • Re:Probably Stolen (Score:2, Interesting)

    by Anonymous Coward on Wednesday October 06, 2010 @09:17PM (#33819352)

    Yes, I think they are not as capable. (I'm Chinese, so the rest of you can drop the racism accusations.) There are some cultural elements that cause this, but Chinese people are resourceful, and plenty of them are filing patents on this side of the Pacific, so there is no reason to think that the folks on the home front are not growing in capability. It is not a bi-level state. It is a continuum, and as a whole, Chinese people will catch up quickly and surpass the US.

    It is also not a single linear continuum. It is much more complex than that, and there will be areas where the Chinese will really excel, and it does not hurt that bozo American companies are cheaping out, and hoping to cash in on cheap Chinese high tech labor only to have their intellectual property walk out the door. (Ever heard of the stereotype cheap Chinese? Didn't realize your own cheap countrymen were selling you out, eh?) If you think the Chinese policy of supplying your whitey companies with cheap labor is just some high ranking general lining his pockets for the short term, you are totally missing the big picture.

    There is no way in hell some of that know how and experience will not leak (even if there is no policy to steal).

    Christine O'Donnell might be right in warped some sense (although she was a lying when she said she had intelligence documents on some Chinese conspiracy). The Chinese will take over, simply because they will become the 800lb gorilla, and they won't have to fire real missiles; they just have to dominate the world economy.

  • by Anonymous Coward on Thursday October 07, 2010 @12:25AM (#33820536)

    And have you noticed that there is no intellectual property protection for legal arguments and tactics? Someone could spend hundreds of thousands of dollars worth of lawyer time to develop a new innovative legal defense, and then someone else can apply the same defense without paying a dime to the first party! Where's the incentive to innovate? Why is the patent establishment, the congress (largely composed of lawyers) and the lobbying industry working on IP protections for other industries while so blatantly ignoring their own profession?

  • by TheLink ( 130905 ) on Thursday October 07, 2010 @04:38AM (#33821934) Journal

    When you owe a bank $100,000,000,000, the bank has a problem. If the U.S. ever decides to default on its loan to China

    It's not even the same problem. Why would the US ever have to default?

    The problem is more like: when TheLink owes the bank 2 trillion payable in TheLink tokens, the bank has a problem, not me.

    Since I can create as many tokens as I want :).

    Think about it more, and you'll see how even more ridiculous the scaremongering about Evil China screwing and holding America to ransom is.

    Sure if the USA creates too many trillions out of thin air, people might stop lending them money, but I think they've already created trillions without too many problems (google for: federal reserve trillions).

    And that's not really China's fault the US is borrowing trillions etc. You can say they are artificially controlling the price of their currency. But it's relative to the US dollar ;).

    If someone is selling stuff too cheap to you, and you are paying them for it with money you borrowed from them, and the debt is payable in money that you can create any time you like, how is that screwing you?

    If you somehow screw yourself as a result, it's your own fault.

    People can say it's all very complicated finance stuff, but I'm telling the truth as it is :).

  • by scamper_22 ( 1073470 ) on Thursday October 07, 2010 @09:17AM (#33823516)

    Anyone who actually believes is in the 'innovation economy' is an idiot. The includes a surprising number of academics for some reason.

    Apart from 'stealing' technology, there are a whole host of other reasons.

    1. Without low-level work, you won't get good people going into the field in the first place. Just picture yourself as a top 10% high-school kid planning your future career. You can risk becoming and engineer/scientists/entrepreneur who will work their ass off in the rare hope of making it big.... or you can get a 'good' job joining the government or government protected field (legal, medical). That's right... your best and brightest will stop going into the field. Contrast that to say China, where their best and brightest will go into the field. Many won't fulfill their potential... but they'll still have jobs as network administrators, sustaining engineering... It makes sense for them to invest in their field. In 20 years, it will be their best and brightest versus our C students in the R&D field. Not to mention... you know all those brilliant immigrants who seem to make up a large percentage of our grad schools... China and India are both working extra hard to keep their best talent there.

    2. You often need to work in an industry to 'innovate'. As more and more functions are moved overseas, they'll be able to innovate on those processes and products that we never get exposure to.

    3. China especially has pursued trying to establish its own industry as opposed to just being an outsourcing hub. And as they get 90% of the functionality, they'll get 99% of the sales. Huaweii is a good example. They don't have to get 100% of the functionality or service as Cisco. But most of the world isn't going to pay for that when Huawei can undercut them them. With those sales comes market share, R&D dollars. Before the US and Europe would export a lot of tech to the developing world. Today, any sane developing country is going to choose a Chinese company. Cheaper, most of the functionality...

    4. Even if you are able to be innovative, it's not an economy. Maybe if you're a small country of a few million, you can sustain yourself off a few innovative industries (singapore, finland...). But there's not enough innovative wealth to sustain 300 million people. Like it or not the vast majority of jobs are regular work... and you're not 'too good' for them. Assembling widgets, farm work, textile work...

    5. There is a certain colonial mentality that people seem to think the West must always be on top and relaxing. While the developing world serves them. It's why you have western people talk about guaranteed incomes, while they need to hire mexicans to work their farms... That world ended long ago... but the mentality is still there...

Doubt isn't the opposite of faith; it is an element of faith. - Paul Tillich, German theologian and historian