No shanzhai please, we’re Hong Kongers

sincere podiumOne of the most frustrating things about being a Hong Kong technology journalist is having people ask you what the next big tech trends are; what kind of weird and crazy gadgets you’ve managed to track down, etc etc.

The truth is, as I’ve discovered over the past 18 months, despite its famously futuristic neon-kissed city-scape Hong Kong is not where you’ll find such weird and wonderful or early adopter technologies. They don’t even really exist in Japan’s famous Akihabara “electronics town” district either – a spot now filled with maid cafes and adult video shops.

The truth is that for pimped out shanzhai goods like these, you’ll need to go to Shenzhen, just across the border from Hong Kong.

This city, and its Chinese neighbours around the Pearl River Delta, has always been the epicentre of cheap, sometimes illegal but usually grey market goods – whether they be recognisable brand name items assembled or sourced from non-official channels, or white box weirdness from tiny makers you’ll never have heard of.

It’s not as if, as I originally thought, there has been a government crackdown on these items in Hong Kong. You see, they’re not technically even illegal – it’s more market driven than that.

“In Hong Kong the government is not banning these products, it’s that the market is not that big,” Frost&Sullivan analyst Lu Shuishan told me. “Some people are willing to pay relatively low prices for shanzhai goods but the market presence of branded products is just bigger.”

People can afford better quality goods in Hong Kong without breaking the bank, unlike in China where an iPhone can cost a months’ salary and grey market versions of the big brands are sought out by virtue of being cheaper, he added.

According to Forrester’s Bryan Wang, Hong Kongers also benefit from buying more of their phones through operators than direct from retail as in China, with two year contracts boosting their affordability whilst locking punters into lengthy terms.

That’s not to say white box goods have completely disappeared from Hong Kong. On a trip to Sincere  Podium – a three floor mecca for smartphone fanatics in Mong Kok – there were one or two brand names I’d never heard of, like Copicell, Daxian and Shouyue.

However, there were no unusually specc’d shanzhai products, of which Western readers are inordinately fond.

As IDC senior market analyst Dickie Chang told me, skyrocketing local rents are also focusing the minds of traders.

“Dealers need to pay more to cover rental costs, so they will need to think carefully about the products
they want to sell,” he argued.

It seems that the era of the weird and wonderful shanzhai handset, at least in Hong Kong, is well and truly over.


Decline and fall of Akihabara as a tech hub

maid cafe signHas anyone been to Akihabara lately? I know I’m probably way behind the times here, but I still had the impression it was the land of all things shiny and technology-related – where impossibly gadgetry was salivated over by Japanese otaku and envied by foreign visitors.

As my latest ramblings on The Reg explain, I was rather disappointed to see, on exit from the station, pristine pedestrian walkways, giant IT mega-stores and shopping centres. Redevelopment over the past few years has apparently made the place a lot more family and tourist friendly but definitely not much fun for those interested in tech.

Most of the small, cramped, independently owned consumer electronics stores have closed now, but don’t blame the local mayor for wanting to redevelop the place. From my conversations with Japan tech experts and analysts it was going to happen anyway.

The area was big in the 70s, when according to some estimates, 10 per cent of all household appliances sold in Japan were bought in Akihabara. Then the PC and laptop boom in the 90s and beyond took over, drawing in a more geeky crowd keen to build their own customised machines. 

But now it’s all cosplay, manga, Maid Cafes and Hobby shops. It seems the tech industry, and Japanese consumers, have moved on. They’d rather get their gadgets online now and maybe try before they buy in a megastore like Yodabashi Camera, according to an IDC analyst I spoke to.

On the other hand, it’s fascinating to see the area reinvent itself as a geek manga/anime/cosplay paradise. Japan, if nothing else, has a remarkable resilience. 

The decline of Akihabara as a tech hub is therefore unlikely to portend the collapse of the country’s once unstoppable tech industry.