Google: ‘Start-ups can save the world’
Posted: November 4, 2013 Filed under: Uncategorized | Tags: china, chinese university of hong kong, cloud computing, CUHK, entrepreneur, eric schmidt, google, hong kong, innovation, SAR, software, start up, tech startup 1 Comment
“Entrepreneurship is the solution to all the world’s problems,” according to Google executive chairman Eric Schmidt, who was in Hong Kong today to launch a new program to foster greater start-up talent within the Chinese SAR.
Schmidt’s visit was something of an anti-climax in the end. Media were not invited to ask any questions and what we finally got from the Google man after a half hour delay was less than insightful.
He trotted out the usual argument that more innovation and technical invention will likely gravitate to this part of the world because there is a “numerical advantage” in terms of graduates with degrees in STEM subjects.
Several times he also repeated the notion that “the native underlying Chinese culture is entrepreneurial”.
“We all know this, it’s been true for 1000 years. It’s a great asset of Chinese history,” he said.
The inference here is that the region and its people should be more inclined than most to producing innovative technology start-ups.
However, we heard very little about why that’s simply not happened thus far, in Hong Kong at least, although Schmidt did acknowledge that there wasn’t enough of a VC industry here and that, although entrepreneurial, the locals are also culturally afraid of being “different”.
Google’s announcement today – a program of mentorship and incubation with the Chinese University of Hong Kong – is surely yet another indication that the SAR government has singularly failed to foster the kind of innovation that can start local and grow internationally.
It’s a view I’ve heard time and again – even from successful international technology companies who came to Hong Kong with an impression of a hi-tech city and found instead something much less mature to work with.
The conversations at most local tech conferences I’ve been to are still at a “what is the cloud?” stage. It’s difficult to believe sometimes.
When asked whether Google was thinking of founding a formal incubator project even Schmidt had to admit: “You don’t have a big enough software industry. Your lack of software … will hurt you in terms of your global ambitions.”
The one year project announced today is unlikely to change that much.
We don’t know exactly how much access to Silicon Valley “mentors” and help with start-up costs local entrepreneurs will get as part of the initiative, but at first glance it seems like a pretty good way for Google to cream off some of the best of that limited Hong Kong talent.
Rackspace goes East with first Asian public cloud launch
Posted: October 22, 2013 Filed under: Uncategorized | Tags: ajit melarkode, apac, BPO, cloud computing, hong kong, hybrid cloud, iaas, open source, openstack, private cloud, public cloud, rackspace hosting Leave a comment
OpenStack cloud vendor and Amazon–agitator Rackspace Hosting is launching its first public cloud offering for Asia in Hong Kong today, so I caught up with APAC MD Ajit Melarkode to talk all things Hong Kong, cloud and Rackspace.
I covered the news over at The Reg. Given that not many businesses rely solely on the public cloud, the announcement can be seen more in context of Rackspace’s Hybrid Cloud offering – which allows users to mix and match between public and private cloud and dedicated server hosting.
As such, I’m sure IT managers in the region will be keen to have another option for their cloudy needs.
They should also be assured that Rackspace is certainly investing significantly in the region, and Hong Kong, Melarkode told me. “We’ve sent a lot of Rackers out to set up here,” he said. “We’re not treating it as a satellite office – Hong Kong has really come into its own this year.”
Testament to this is Melarkode himself, who has experience of running operations on the ground in the region, and the fact that the firm is setting up dedicated finance, HR and marketing departments, as well as hiring a regional CTO, lead engineers, SMB and enterprise support staff, and ensuring that there is a good spread of local language speakers.
So who is Rackspace hoping to target with its new offering? Well, according to Melarkode, the growth of the Hong Kong office and APAC hub can be seen in parallel with the expansion of Rackspace customers into Asia: “as our customers expand we expand with them – we’re driven in a major part by client requirements”.
Another market he mentioned was that of the smaller innovative local companies in industries like retail and technology which are unencumbered by legacy infrastructure and are “leapfrogging onto new technologies like mobile and cloud”.
Melarkode was unsurprisingly quick to leap to the defence of Asian firms, which are often branded as copy cats and accused of lacking the ability to truly innovate.
He argued that creating services on top of “building blocks” already developed in the West does not necessarily amount to copying – and pointed out that firms from the region are contributing code to OpenStack, which he claimed is certainly not the behaviour of a technology laggard.
The region in general, while perhaps slightly behind the West, is certainly catching up in terms of the maturity of its IT services industry.
“I’ve seen how the region has developed right from the time Indian outsourcing started blooming in 1993, to the more hardware and infrastructure focus in China and the BPO success taking hold in the Philippines,” he explained.
“What I see is lagging behind here but the pace is still fantastic. Look at how it’s catching up. Lots of clients used cloud just for back-up and storage but now they’re starting to use it for app testing and development. The catch-up rate is astonishing.”
Rackspace will certainly need that maturity to expand beyond the handful of early movers in APAC if it’s to recoup some of its growing investment here.
Things are moving pretty fast, though, with the firm doubling headcount and its datacentre space in Hong Kong to meet expected demand and with plans to do so again in the coming year, Melarkode said.
Decrypt Weibo: new tool promises a censorship-free Sina Weibo
Posted: October 3, 2013 Filed under: Uncategorized | Tags: censorship, china, communist party, decrypt weibo, freeweibo, great firewall, greatfire.org, online freedom, sina weibo, the register, weibo Leave a comment
GreatFire.org, a not-for-profit calling for an end to China’s repressive censorship regime, has launched another tool designed to bring transparency to the Chinternet and no doubt some consternation in Beijing.
I covered the Decrypt Weibo announcement over at The Register. It pretty much does what it says on the tin, allowing users who see a post on Sina Weibo that has been blocked by the censors, to retrieve that message.
The founders of GreatFire have been mapping the censored Chinese internet for over two years now and last year launched FreeWeibo, a tool which allows users to conduct uncensored searches of Sina Weibo – by far China’s biggest weibo platform.
However their work so far seems to have flown under the radar, which probably comes down simply to user numbers.
“We’ve been operating FreeWeibo.com now for almost a year and they have not done anything to try to block that service,” co-founder Charlie Smith told me. “It may be that we are just a small blip on their radar. But we think that we are making things difficult for them and we are going to continue to makes things difficult.”
The big worry for internet freedom advocates is that China’s latest attempts to suppress online free speech have edged the closest yet to an Orwellian “thought police” model.
In attaching severe jail terms to any popular online message subsequently deemed to be a harmful “rumour”, the government will slowly and insidiously create a nation where all but the bravest are afraid to say anything mildly controversial online, for fear of reprisals.
That’s the worry anyway, as GreatFire alludes to in its post explaining the launch of Decrypt Weibo, although it’s good to hear that Smith and his team are undimmed in their fight.
“Sina’s likely reaction to our new service will be to inform the authorities about our presence … and put the matter in the hands of the police. The police won’t find us and won’t be able to shut us down which means that they would have to shut down the entire Sina Weibo service to stop us doing what we are doing. This would lead to a massive public outcry,” he said.
“Of course, we hope that they just decide to end online censorship voluntarily.”
In the end, the only way this could happen is if the Communist Party realised that its demand for indigenous innovation-based economic growth (rather than one reliant on copying and stealing IP) is doomed if it continues to suppress debate online and place such a heavy burden on web companies for self-policing their platforms.
Unfortunately I don’t think this will happen anytime soon, so in the meantime let’s hope Decrypt Weibo finds its way into the hands of as many Chinese netizens that need it as possible.
China ready to lift the Great Firewall. Maybe. In part of Shanghai
Posted: September 24, 2013 Filed under: Uncategorized | Tags: censorship, china, facebook, great firewall, hong kong, li keqiang, shanghai, shanghai free trade zone, twitter Leave a comment
Reports emerged from China today that at first sight seem almost unbelievable: the Communist Party about to lift the Great Firewall and unblock access to Facebook, Twitter and a host of other banned sites.
Then the small print. If the anonymous government sources are speaking the truth, it will be only be relevant to Shanghai Free Trade Zone, a 28 sq km pilot project designed to encourage greater foreign investment in China and open its economy up to the international markets.
“In order to welcome foreign companies to invest and to let foreigners live and work happily in the free-trade zone, we must think about how we can make them feel like at home,” one government source told the South China Morning Post.
“If they can’t get onto Facebook or read The New York Times, they may naturally wonder how special the free-trade zone is compared with the rest of China.”
Now while that seems fair enough, the Communist Party isn’t known for its love of unfettered access to the internet – after all the free flow of information online is precisely the sort of thing which it knows will lead to its demise.
So what’s this all about? Well, a few things sprung to mind:
- China is in the middle of one of the worst crack downs on online freedom anyone can remember, so don’t expect this localised liberalisation to spread anywhere else in the Middle Kingdom. The party is very much still for the suppression of any discussion it deems “harmful”.
- Even if the Great Firewall is lifted in the Shanghai zone, doing so from a technical standpoint will take time, according to Forrester analyst Bryan Wang.
“The network within the free trade zone will exist something like an intranet, which is connected to the international backbone without going through the Great Wall firewall,” he told me. “Current infrastructure will not be enough to support the future development. China Telecom or Unicom will need to lay out new fibre in the free trade zone.”
- The Party giveth and it taketh away. Nothing is confirmed yet, and until state-run media reprint the story, we can probably take it as just a rumour, possibly one designed to increase international publicity for the zone, which is a pet project of new premier Li Keqiang.
The whole free trade zone itself is only a pilot, so we can expect Beijing to bring the Great Firewall crashing back down on the region if its censorship-free internet policy backfires.
On a side note, how will Hong Kong react to the free trade zone?
If the Shanghai pilot is successful, more of them could spring up across China, effectively stealing its thunder as the only truly outward facing, economically liberalised, online censorship-free region in the Middle Kingdom.
Although a free and unfettered internet may soon no longer be a differentiator for Honkers, however, it’s likely that its superior IP protection regime, rule of law and business friendly visa system will still tip the balance in its favour for most MNCs.
Microsoft’s Windows Phone challenge: selling Nokia-less Lumias in India
Posted: September 19, 2013 Filed under: Uncategorized | Tags: brand Trust report, branding, china, IDC, india, lumia, lumia 520, microsoft, nokia, smartphones, windows phone, windows phone 8 Leave a comment
A couple of weeks ago I wrote how Asia would be the key to Microsoft’s success with its soon to be acquired handset business and Windows Phone. Well, new IDC stats out this week confirmed the importance to Redmond of one of Asia’s biggest markets, India, but also that it may struggle without the Nokia brand.
India is now rated by many analysts as the fastest growing smartphone market in the world.
The numbers speak for themselves. The largest democracy on the planet has a population of over 1.3 billion but smartphone penetration of only around 10 per cent – in this it’s some way even behind China and has huge growth potential.
The question is who’s going to capitalise? Well, at the moment it’s the same old story of cheap, local Android handset providers. In India Karbonn and Micromax are two of the most prominent.
Windows Phone was a surprise second place in Q2, however, with a market share of 5.3 per cent, according to IDC. Granted, this is way behind Android’s 90+ per cent, but still above iOS and BlackBerry and remember that percentages translate into 500,000+ units.
The key to success going forward, however, will be how it handles the Lumia, according to IDC analyst Kiranjeet Kaur.
She told me that although Nokia sells the Lumia 520, 620, 625, 720, 820, 920 and 925 in India it has been the 520’s low price point of around Rs 10,000 (£100) which has made it popular.
Microsoft can’t rely on the Lumia range to continue attracting buyers in the future though, because the all important Nokia brand will soon be removed.
“People buy the Lumia because they’ve had an association with Nokia for many years and see it as a good brand,” she said. “But if the [acquisition] deal goes through in the next few months I’m not sure how quickly Microsoft can do the rebranding.”
Time will tell whether this makes a big difference. It has to be said that Nokia was far from coasting in India. Despite winning the country’s Brand Trust Report for the third year in a row in February, it has been mired by tax problems and slowing sales.
Still, India remains Nokia’s second largest market after China, according to IDC, so the next 12 months will be a key test of whether Microsoft can continue the momentum and take on the likes of HTC and Samsung in the mid-range as well as stealing a bit of share from domestic players at the lower end.
It will be an uphill task.
No news is bad news for Apple in China
Posted: September 11, 2013 Filed under: Uncategorized | Tags: apple, china, china mobile, cupertino, forrester, huawei, iphone 5C, iphone 5S, iphone launch, lenovo, meizu, smartphone, xiaomi Leave a comment
So there it is. Apple’s much publicised Beijing iPhone launch event ended. With no news.
It appears that the fruit-themed company, while claiming that China will be its biggest market soon, does not believe it’s THAT important. At least yet. All the poor hacks were offered was a video of last night’s US launch. Ouch.
More importantly for Cupertino, the prices it has stuck on its new 5C and 5S devices will mean only the most hardy fanboys and girls will want to buy them. The iPhone 5C is definitely not budget, so it will fail to appeal to the mass low-end market currently consuming smartphones in China and India like there’s no tomorrow.
A 5C will retail for between 4,488 and 5,288 yuan ($733-864, £466-549). Compare this with the price for the high-end 5S in the US ($649-849) and you can see why some commentators reckon it will fail in the PRC.
It’s certainly not enough to beat Xiaomi’s impressively spec’d Mi-3 at 1,999 yuan ($326).
Forrester analyst Bryan Wang told me that it needs to come down to 2,999-3,499 yuan in order to “eat up the market share” of the likes of Huawei, Lenovo and Meizu, but that at present prices, the local Android players will be “really relieved”.
However, Apple is likely to have left itself some breathing room. It’s plan? Test the market out with these inflated prices and then “lower the price after a couple of months”.
Apple’s other hope of gaining much needed market share in China come from a possible tie up with the world’s largest operator, China Mobile, which has over 700 million subscribers.
No announcement was made at the Beijing press “conference” today but Wang believes it will come, when the carrier has a 4G network to announce. The reason? The 5C and 5S both support TD-LTE, a standard China Mobile helped to build.
APAC the key to Micr-okia success
Posted: September 6, 2013 Filed under: Uncategorized | Tags: apac, asha, brands, china, huawei, IDC, india, lumia, M&A, micromax, microsoft, nokia, smartphone, zte 1 Comment
It was Microsoft and Nokia’s big week this week and I’m sure the two will be hoping to hog the headlines going forward as much as they did over the past seven days. Now some might have unkindly described the alliance as “the sounds of two garbage trucks colliding”, but I’ve been getting the low down on why the deal should matter to APAC, or more realistically, why APAC should matter to Microsoft.
Let’s get one thing straight, APAC is essential to Microsoft’s future success in the smartphone space, not just because it has the world’s largest and fastest growing market – China and India respectively – but because Nokia has a really good legacy footprint there thanks to its feature phone biz.
The problem for Redmond, however, is that we’re not talking about feature phones any more, but smartphones. These markets are increasingly demanding smartphones, albeit low-end handsets, not feature phones. It’s why local players like Huawei, ZTE, Micromax and others are growing at such speed.
Nokia’s stock is greatest in India, where it has been voted most trusted brand for two years in a row, despite on-going tax problems with the authorities. Yet according to IDC’s Melissa Chau its relationship with operators isn’t particularly great anymore, so to large extent Microsoft is going to have to start from scratch here.
Building a budget Lumia will be vital and Chau told me Microsoft could do two things to help achieve this:
- Remove licensing charges – at the moment it’s built into the cost of the phone – which would wipe about $10 off per handset
- Use its combined internal expertise now with software and hardware to tweak Windows Phone so that it can run on hardware specs more suited to a lower price point.
It also needs to sort out Asha, she told me, starting with making the handset more attractive by sticking some Microsoft apps on it, and then hopefully in time transitioning those customers to a low cost Lumia.
This ain’t gonna be easy. The competition is fierce out there and with Nokia’s star waning and a severe lack of apps in the ecosystem the best Redmond can probably hope for is cementing it in third place behind the deadly duo of iOS and Android. With four of the Lumia’s top selling markets in APAC (including no. 1 and 2) however, it must make the region a priority.
Time will tell how successful it is, of course, but time, as we all know, is probably something Micr-okia doesn’t have.
Come in Agent Elop, your work is done
Posted: September 3, 2013 Filed under: Uncategorized | Tags: acquisitions, android, apple, CEO, devices and services, finland, M&A, microsoft, microsoft buys nokia, nokia, redmond, RIM, smartphones, stephen elop, steve ballmer, windows phone Leave a comment
It’s finally happened. Microsoft today announced it is buying most of Nokia’s mobile phone business for a bargain €5.44bn (£4.62bn) in cash.
The deal will see Redmond snap up the Finnish giant’s Devices and Services business for €3.79bn (£3.2bn), license Nokia’s patents for €1.65bn (£1.4bn).
It’s a dramatic last roll of the dice for outgoing CEO Steve Ballmer and neatly brings back former Redmondite Stephen Elop into the fold.
He’ll be stepping aside as Nokia boss to become EVP of Devices and Services, but must be one of the favourites now to succeed Ballmer. If so, this will be one of the most expensive pieces of headhunting in corporate history.
Nokia’s chairman of the board Risto Siilasmaa will take the reins as interim CEO while the deal goes through the usual shareholder and regulatory approvals. Microsoft said it expects the transaction to close in Q1 2014, all being well.
For Microsoft the deal is proof if any were needed that it’s no longer a software company, that it sees success in the smartphone space as crucial to its future and that it can’t rely on a partner like Nokia to deal with the hardware side of things.
A few things occur to me:
- HTC and RIM will be pretty disappointed – who are they going to get to buy up their failing businesses now?
- Agent Elop has now been recalled after 2 years out in the field persuading Nokia’s board to sell to Microsoft. Job done – you may now progress to Microsoft CEO.
- China’s up and coming smartphone poster child Xiaomi was recently valued at $10bn, nearly $2bn more than Nokia at this sale. Surely over-inflated.
- This deal, while it could theoretically ensure phones get out faster to market, is not going to make life any easier for Microsoft or its new Nokia Devices and Services division. Especially in Asia. Its lack of apps will still hold it back.
- Is Nokia still Europe’s largest technology firm? Over 30,000 staff will now be Microsofties but it still has over 50,000 employees on its books working on the reasonably profitable NSN biz and location services. It should be in pretty good shape.
IDC analyst Bryan Ma told me that the deal would give Microsoft a shortcut or “jump start” into the hardware space, but could end up alienating OEM partners.
“It’s got device, manufacturing, economies of scale, and channels to sell into which would have all take it longer to grow organically, as well as valuable patents,” he argued.
“My concern is as much as this can help it doesn’t solve the biggest problem facing Windows Phone and Windows 8 on tablet and PC – it doesn’t have enough apps to make a compelling platform.”
Tellingly, Microsoft only devotes one bullet point on the app ecosystem in a mammoth 27-slide presentation explaining its strategic rationale, he pointed out.
Ma added that the deal could end up alienating more OEM partners.
“The whole debate Microsoft got into when it released Surface was that its hardware partners like Acer said it was stepping on their toes. This will raise questions over whether this is more salt in the wounds for them.”
As for smartphone OEMs well Windows Phone has very few of those beyond Nokia anyway so it will step on fewer toes, he said.
However, I’d agree with Canalys VP research Rachel Lashford that it’s not exactly going to attract any more into the fold either.
“It reminds me of a decade ago when Nokia owned Symbian and tried to license it out but it didn’t work out,” she told me. I can’t think of many OEM vendors would fancy going head-to-head with Microsoft on Windows Phone now.
As for Asia-specific repercussions, well I’ll be taking a look at those – and there should be some given Nokia’s legacy in India and Microsoft’s desire to crack China – in my next post.
Baidu Light App could help developers crack China….eventually
Posted: August 23, 2013 Filed under: Uncategorized | Tags: 91 wireless, app stores, applications, baidu, china, chinternet, developer, light app, marbridge consulting, mobile internet, web apps Leave a comment
On Thursday Baidu made a pretty major announcement in the mobile apps space which wasn’t covered in a lot of detail by the international press, but I reckon this one could be a biggie for developers everywhere in time.
Light App is Baidu’s answer to what CEO Robin Li described as a “fundamentally flawed” app store system, whereby less than 0.1 per cent of apps account for 70 per cent of downloads.
It’s bad for the user and it’s bad for the developers ultimately, as not many can practically and efficiently reach large number of content consumers.
No problem, says Baidu. Alongside your basic mobile app, simply design a web app which can run on Light App and it will be made available to users hassle free, without the need for download and install, via a Baidu service.
Logging into Light App, users can search for ‘new apartments’, for example, and it will call up all the apps that may fit the bill – ie ones offering local listings and alerts. They may never have found these apps otherwise and certainly would use them so infrequently as to not warrant the hassle of downloading them.
It might seem a bit rich for Baidu, which has just spent $1.9bn on buying app store firm 91 Wireless, to complain about flawed app stores, but what it’s trying to do does make sense, and can be seen as another attempt by the firm to gain another foothold in China’s lucrative mobile internet.
It’s still very early days for this one, and success or failure will depend on how the developer community takes to it, but I reckon it could be particularly useful in time for devs outside the Great Firewall.
Baidu has been taking baby steps with engagement with non-Chinese devs in recent months and if Light App resources are eventually made available in English, it could be a real boon – helping otherwise virtually undiscoverable applications reach the attention of Chinese users.
Mark Natkin, MD of Beijing-based consultancy Marbridge Consulting reckons so too. He told me the following:
I think the new Light App platform should be beneficial to all developers, both domestic and foreign, in that it makes it easier for users to try an app without having to download and install it, allows users to search for apps not only by the app’s name but also by its content (which improves the ability of long-tail searches to find the type of app that most closely matches the user’s needs), and allows apps to more easily integrate a variety of functionality developed and provisioned by Baidu (like voice input, etc.).
Forcing out rooms – Japan’s dirty secret
Posted: August 21, 2013 Filed under: Uncategorized | Tags: electronics, employment law, gartner, japan, nec, new york times, oidashibeya, sharp, Sony, the register Leave a comment
Over the weekend a New York Times story had some interesting insights into the continuing labour problems at Japan’s once proud electronics giants.
It alleged that workers who are unable to be sacked are often sent to oidashibeya or “forcing out rooms” where they are made to perform menial or repetitive tasks in a bid to make them resign out of shame and boredom.
It’s not particularly nice but it’s a situation that seems to have been forced upon multinationals such as Sony because of Japan’s relatively strict employment laws which make it hard to sack staff without good reason.
These firms simply can’t be as agile as their international rivals because they can’t downsize or strip out waste in specific areas. In the technology industry especially, skills can quickly become outdated.
As Gartner analyst Hiroyuki Shimizu told me, these laws should take the majority of the blame for the decline of Japan’s electronics industry on the global stage.
“In these 20 years, the goal for the company executives in almost all the Japanese electronics companies were to make much use of (or not to leave idle) their own excessive resources including workers and assets,” he said.
“In the global electronics market, companies focus on their differentiators. However, Japanese companies focused on the segments where they have plenty of human resources and large assets.”
This is a major failing of Japanese technology firms but not the only one.
Large scale job cuts are starting to appear, at firms including NEC, Sharp and Sony, although more are probably needed. However, this stripping out of dead wood needs to go hand in hand with enhancing traditional areas of technical weakness, said Shimizu.
It’s also true that there’s more to Japan’s well-charted decline on the technology front than just some stubborn employment laws.
“There are several reasons for each Japanese company for losing power such as commoditisation of electronics products, severe competition with Korean or Taiwanese companies or exchange rates,” he told me.
“But we consider that the deep-seated reason is the employment policy of Japanese companies.”
phil muncaster 