Is It Time to Stop Doing Business with China?
• Software: According to the Business Software Alliance, a Washington, D.C.-based lobby group, over 90% of the software used in China is unlicensed.
• Pay TV: “China has become the hotbed of a new technology that distributes live television signals over the Internet, exposing the world’s pay-TV operators to the kind of online piracy that has plagued the music and movie businesses,” write Geoffrey A. Fowler and Sarah McBride in The Wall Street Journal. “The technology, called peer-to-peer, or P2P, streaming TV, enables viewers anywhere in the world to watch cable, satellite or broadcast TV on the Web free of charge. Pirate services offer the programs to anyone equipped with a high-speed Internet connection who downloads some simple software.”
• Automobiles and Auto Parts: Over the 10 years that GM partnered with Shanghai Automotive Industry Corp. to make Buicks, the Chinese stole the know-how and used the money earned to create the Roewe, a direct competitor. GM is suing Chery Automotive for stealing the design of its Spark minicar about which U.S Commerce Secretary Donald Evans said the resemblance between the two “defies innocent explanation.” The Chery Tiggo is a virtual carbon copy of Toyota’s RAV4. And Hanns Glatz of DaimlerChrysler estimates Chinese counterfeit Daimler parts represent 30% of the market in China, Taiwan and Korea.
• iPods: Both Hitachi Global Storage Technologies and a little-known subsidiary of a Chinese automobile maker, GS MagicStor, were selling Apple a tiny electronic storage device for its smallest iPod model. Trouble is that Hitachi claims GS MagicStor stole its technology and is selling it not only to Apple, but all over the Far East. A suit has been filed in Northern California Federal District Court.
“Let’s be practical here,” said an American pharmaceutical executive. “It won’t get much better until China has its own intellectual property to protect.”