culture - On Being Chinese

Today I had a nice encounter with a Shanghainese friend who is working for a larger European chemical company and got a bit lost in the office politics. So we met at the Shanghai Railway station to have a lunch. "There are too many cars," I complained after we escaped again a car trying to kill pedestrians.
"Shanghai has too many cars and too many foreigners," she answered.
"Thank you very much," I replied.
"Oh, but I did not mean you," she said. "You are already a Chinese." I'm sure she meant it as a compliment but still not sure how to take it.

economy - Car sales drop

September 2004 saw a drop in car sales in China compared to the same month in 2003, writes the Financial Times.
It is another time that the party that started for car manufacturers in the first half of 2002 might be over. A combination of the credit crunch by the central government and a lackluster mood among the potential customers who expect further price reducations are some of the explanations.
Apart from a drop in units, also the average price is dropping. Last year 25 percent of the cars sold cost almost 25,000 US dollar, now the average price is about half.

Connecting China – You know these magazines are screened



“Hey, I get that magazine for free,” says marketing manager Scott Shi when I show him a copy of the Chinese edition of Newsweek. Scott got it last week for the through his bankcard at the Bank of China. “I was really amazed they gave me a free subscription for a whole year.” It is a nice story on how high-end print publications try to increase market share among the wealthy Chinese, and will probably fail.
First, Scott has many bank accounts and bankcards. Brand loyalty in China is not very important and most Chinese I know have larger numbers of cards with a large variety of banks. The Chinese edition of the Harvard Business Review was on of the publications that now lands in Scott’s mailbox.
The last thing Scott will do is pay for such a subscription. “The Harvard Business Review costs at least 70 renminbi per issue,” Scott says. “I cannot imagine anybody paying that for a publication. You know these magazines are screened, so I mostly do not even open the envelope.”
“Why should I pay for a print publication, while I can get the unscreened information for free on the Internet?” he wonders.
The problems for foreign publication, eager to reach do not stop with a Scott Shi who even does not take his free goodies out of the envelope. He knows they are screened, but only because he assumes so. He can get the information also for free from the internet, but does seldom do so. Foreign brand names do not have an appeal among the Chinese internet users that would gurantee them instant success.
Connecting China is an irregular feature that tries to introduce Chinese internet users to the outside world.

media - ESPN pushes the envelope



(later today also in Chinabiz; picture: the first cover)

The famous US sporting magazine ESPN launched on Friday their Chinese edition in Shanghai, trying to write media history in China. It was the first time that a foreign publication takes almost full control of a magazine at the mainland. It was very eager to make the launch into a low-key event for their mainly American bosses.
“You cannot run such a magazine, without being in control,” said Bernard Stewart, vice president and general manager at ESPN Asia Pacific.
China still does not have such a sporting magazine,” said Joseph Poon, CEO of the Vertex Group and the Hong Kong partner in the venture.
The magazine obtained a publishing license from a magazine of the China Sport Academy that “will have the last screening control over the magazine”, explained Poon. Giving editorial control to foreign companies, even in such inconspicuous fields as sport, is off limits in China. In the first magazine, that will appear monthly, the Shanghai Century Publishing Group was mentioned as a local publisher.
It will be the first time a Chinese partner has only nominal control over a publication in China. The new partners were not too sure how their milestone in the Chinese publishing industry would go down, and organized a rather low-key launch for their US partners, the first one where not only their local partners were absent, but any governmental representation was lacking.
“When Procter and Gamble is launching a new tooth paste, they do not invite government officials for that,” Joseph Poon defended himself. Obvious Mr. Poon had not attended many tooth paste launches in China.
Up to now virtually all media projects in China where foreign companies tried to have a say have failed when those media came close to a success. Virgin withdrew from a radio project only weeks ago in Beijing and many of the so-called city-magazines are developing trouble. Most notably That’s-magazines got into trouble after it had to hard control over to its Chinese partner. Successful ventures like ‘Elle’ could survive because the French mother company only sold the publishing license to a Chinese company.

internet - the proxy experience

Others still complain they cannot use the proxy I find so useful. It is not 100 percent hosanna, I discovered over the days. While my access to blogger is better than ever thanks to the proxy, my weblog host does not allow me in when I have the proxy running. Online payments are also a problem, partly I guess because the proxy changes servers frequently and that triggers off alarm bells and makes transactions impossible. Also my msn-messenger gets a bit nervous because of the changes and switches on and off, even while I'm sleeping. That annoys the hell out of my msn-friends again who think I'm ignoring them.
Minor problems, I still think, compared to the advantages.

internet - Google active in China

An interesting call I witnessed this afternoon. A fried here in Shanghai got a call over his landline, answered in Chinese all kind of questions. "It was Google," he said, a bit amazed. "The were checking whether the details I gave for Adsense were correct."
Since they called in over a landline, we could not see where the call originated from, from China or from the US. I will just change my data, so they only have mine mobile number.
One of the ways they stayed out of trouble, was be not being in China with a legal representation. Now that might have to change, as time moves on and this is an interesting signal.

internet - Getting ready for 111 million users

In my propaganda speeches for the internet I always said the by the beginning of 2005 China would have 100 million users online, almost half of it through broadband. Wrong, wrong, very wrong again.
Expectations for the end of this year are around 111 million. We journalists do like round figures, but this can do to.

media - Reuters' CEO gets a Chinese treat

Danwei discovered that Tom Glocer, the CEO of international newswire Reuters, got high level reception and coverage in Beijing.
What are these guys up to, must they be thinking too at the Xinhua Financial Newswire, headquartered in Hong Kong, but with bases also in Beijing and Shanghai. In the summer of last year their managing director Graham Earnshaw said at a meeting of the Shanghai Foreign Correspondents' Club, that "both Reuters and Bloomberg would be obsolete in two to three years because since the end of the 1990s both of them had been losing their technological competitive advantage of being able to deliver news in real time to their customers.
"The Internet, he went on to say, now made it possible for others, including XFN, to do the same kind of news gathering at a lesser cost. The worldwide operation of the older newswires – deploying a high number of journalists – is too high of a burden, he argued. Revenue streams in many places were being reduced to a trickle, and much of the overall news operation was having to be subsidized by the work in the more profitable financial markets." (At least that is how I summerize him in the latest Nieman Report that is not yet online.
Earnshaw, a 30-year Reuters veteran who retired there at the end of the 1990s is no longer mentioned at the XFN-site. And he does not mention XFN in his bio.

Falling off the Richest List: who is next? – the WTO column

(soon at Chinabiz)
The annual publication of the China Top 100 Rich List, composed by Rupert Hoogewerf, was this week again one of the high lights in the Chinese media. The annual celebration of private entrepreneurs is a justified one: in ten years time they have changed the face of China.
But what was almost fully left out during the press conference and most from most of the generous Chinese media coverage is the dodgy side of the rich. Every year saw at least one top-entrepreneur, often greatly supported by different local government, fall down from the list into oblivion, and sometimes into jail.

The two Tang brothers of D’Long are currently helping the authorities to find out how their assets, estimated by Hoogewerf last year on US$2.6 billion, could evaporate without almost a trace. “They fell victim to overexpansion and broken cashflows, fuelled in part by the efore-mentioned austerity measure,” is all what the press release of the Euromoney China Rich List says about D’Long. They fit into a fine tradition with illustrious names like Yang Bin, Zhou Zhengyi that were first pampered, and then dumped from local protection.
All four of them were able to fascinate relative outsiders, especially those in Hong Kong, that for rather unclear reasons thought they were a good bet. In all those cases alarm mechanisms did not work or only when it was too late. They even became part the elite of the top-100 richest Chinese.

Have the media failed? Partly I think. Nasty rumors and uncontrollable stories we heard abundant about all of them, but it was mostly hard to get them confirmed. D’Long has been very effective in keeping investigators outdoors. Checking on the nasty stories was initially hard, they were not that big yet, and so many of us gave up. In China there is still a premium on non-disclosure.
But Yang Bin was exactly the opposite. He used the media to build up his sand castle and sold effectively his ludicrous idea of building greenhouses in freezing Shenyang. I have seen many flower experts passing by in the media, but still he was celebrated as Mr. Big.

Who is going to be the next one on your 2004 list, I wanted to ask Hoogewerf, although I knew I would talk nicely around my question. All four men illustrate the risk, sometimes high risk of doing business in China. Today China has three people who have more than one billion US dollar in assets, making also the stakes higher than in the past.
Also the current number one retailer Huang Guangyu of Eagle investments shies away from the media. “We prefer to keep a low profile,” says one of his aids to Bloomberg. “That’s all we can say at this moment.” That should be a bad sign.

Fons Tuinstra

internet - More proxy news

Despite all my enthusiastic news on proxies a few new fact. First, it was not as new as I thought. Actually two services are already around for quite some time but nobody told me. Second, I will give you also the links for both services in China. It is not very useful if you need a proxy to download a proxy. You can go to ultrareach or to Dynaweb to download there software.
Some people report continued problems in getting their proxy running from different parts of the country, including Shanghai. The only thing I can say it that mine is up and running.

Protest – Violence might disrupt golf events

Angry citizens might disrupt the coming week the Crown Plaza Golf Tournament at the Tomsom Golf Course, as management of the Tomsom Golf Villas continues to ignore complaints. Earlier protest on 19th September in the Club House and the 1st tee box erupted in violence as 250 international residents surrounded the residence of the Chairman of the Tomsom Group, chanted slogans and threw eggs for 30 minutes. “No injury was reported,” says an account of the insurgents, suggesting that more could be expected.
The Tomsom Group has angered the inhabitants, including many presidents and CEO’s of foreign invested enterprises, by arbitrarily closing down common facilities like the driving range, the tennis court and even the children’s playground.
Social unrest is emerging everywhere in China, and even residents in high-end compounds turn to violent protest as other ways seem not to work. For next year even the BMW Open Asia might be disturbed when the Tomsom management does not deal with the complaints of its inhabitants.
The Tomsom Golf course was one of the high-end investments during the China-wave of the 1990s that did not pay back. Many of the villas remained empty and while investments in many retail, logistical and manufacturing facilities have been written off much earlier, this relict of too much optimism remains as a lonely monument.
The Tomsom Group has invested over 1.5 billion US dollar in Shanghai

internet - Livingin gets overheated


There has been quite some discussion on Living in China and whether the blogger's portal is still the promise it was in the beginning. Well, I should have put up some links here to that discussion but unfortunately their server seems to be unable to deal with the traffic. Now that is both good and bad news of course.
The site still works very well as a traffic-generator, so for many of the innocent surfers at the Net it points in the direction of at least this blog. Contentwise there is a profound lack of direction. Any focus, more newsy, more community-like, even more human rights, more service-oriented, that would not matter as long as there is not this big nothing.
A portal for bloggers has no face, since the collective of bloggers has no face. You still need editors to get a bit of content organized - fortunately.

internet - The end of the firewall ?

The much-discussed Chinese firewall in the internet has been a highly symbolic barrier to keep information from the outside world away. Experienced users would need between ten and thirty seconds to go around the blocks, and it belonged to the first lessons students would get at university.
With the new proxy in place we do not need to yell to Google and others that the emperor is wearing no clothes. What is next? I see two possible scenario's.
Option one, our filter boys and girls acknowledge the fact that blocking the internet is impossible, give up and let it go. Then the Chinese firewall would be gone and that would solve also the increasing problem of the shortage of filtering capacity.
Option two, an arms race will break out between those who filter and those would help us to go around. Efforts will be taken to block the new proxies, new alternatives will come up, and internet traffic will get heavily distorted and again economic damage will be done.
I hope of course for option one, althought that would mean we have to find other subjects to discuss, maybe even more interesting ones. But option two is certainly also a possibility.

internet - Fast proxy service

A new proxy service has gained popularity very fast on the mainland, as it does not not need to be reinstalled. Even webbased proxies would need about ten seconds to be installed, and that was long enough to deter the less motivated surfers.
The new service runs permanently, and might get into trouble as China's firewall builders might be eager to get the service closed. I have no clue how it exactly works, but even non-blocked servers that would run into problems - like the interface of blogger.com - runs more smoothly under the new service.

Economy - Power shortage puts logistical systems under pressure - French

The logistical systems between major manufacturers and their suppliers in China are increasingly coming under pressure and are in danger of falling apart, said Paul French, director of Access Asia at the IFLN Membership conference on Monday in Shanghai.
While many foreign invested companies got preferential treatment during the ongoing power shortages, their suppliers – mostly smaller private enterprises – have increasingly trouble in doing their share of the just-in-time systems that has developed over the years. “Most of them have very small margins,” said French, “we have not yet seen them going out of business in a massive ways, but these small guys are going out of business. Private companies are not getting enough power.” GM, Siemens and other producers rely for most of their components on local products.
Because of the shortage of power, coals transport get priority over other products, adding pressure on the logistical systems, added French.
(Oh, yes: a speaker from China Shipping did not show up, and I did not have internet access)

Internet – I passed the 10,000-hit mark!

Do you ever google yourself? Of course you do, unless you have a name that is shared by too many others in the world. When your name is for example Paul French, one of the writers at Chinabiz, you can beat it: there is too much pollution. Apart from sheer vanity I did it also in the past to check whether somebody would copy my stuff. Both in Europe and China people are mostly polite enough to mention your name when they infringe on your copyrights. In that way I could always invoice them afterwards. That was useful in the past, but tonight I discovered I passed the 10,000-hit threshold at Google and even vanity has its limits: I’m not going through all those hits anymore.

For the occasion , I tried to benchmark me a bit, and was surprised. Many people who have popular and interesting websites, score still rather modest. Dan Gillmor is of course far ahead with over 150,000 hits, but somebody like Joseph Bosco only passes the 6,000: I’m sure that will change very soon. Wang Jianshuo, one of the most popular Chinese bloggers, gets just over 2,000 hits. But even somebody like the famous Rupert Hoogewerf, who will present his top-100 Chinese Rich people list on Tuesday, gets even does not pass the 1,000 and even his Chinese name Hurun stays under the 2,000 mark. Hope this entry will boost his virtual presence a bit.

internet – Only 7% of HK net friends have sex

The China Digital News picked up an article in an obscure online newspaper that tells us that 55 percent of Hong Kong teens made friends on the net, while 7 percent have sex. The paper is doing its best to sounds alarmist by suggesting that a part of the teens involved were between 12 and 15 years old, but it is rather unclear how many are actually under 15.
It is a very typical way for scientist and media to keep themselves busy. Now look at other places where young people meet, like bars and – just imagine the idea – at school. What percentage would make friends there? And I would only be honestly alarmed if only in 7 percent of the cases sex would be involved. Only 11.6 percent had suffered financial loss after meeting online friends. Damned, the money I spend in bars and restaurants.

culture - Chinese lines of command

Too many people see China as a basic top-down autocratic regime, where Beijing decides what happens in the country. Fortunately, and sometimes also unfortunately, the reality is a bit more complicated. A nice example was given by a foreign teacher at one of Shanghai's more famous universities. I had asked him to see if his university could get an event organized.
"I even do not know who to ask," he wrote back. "I have no clue who even my boss is." He had been there already for almost a year. Never mind, I told him, being positive as always: "at least there is also nobody who can fire you."
"But there is also nobody who want to pay me," he wrote back. Well, I had to agree that that can be a nuisance in a system that very often looks like something I would have called in the past anarchy.

internet - Access with Chinese characteristics

After hanging around in China for some time, you do not take things for granted that easy. Last month I asked the Ramada headquarters whether their brand new hotel had facilities to give visitors wireless access. That had to tell me it was not possible, so I located already a nearby Starbucks.
Last week their website suddenly suggested that I could purchase wireless access, 100 Renminbi for 24 hours. Still hundred renminbi too much, but better than no access. Just now I went to test the system.
On de ground floor there was no signal at all. The casher was willing to sell me a 100-rmb cards, but had to agree that when there was no signal I could better keep the money in my pocket. They had access at the business center on the third floor.
A very friendly lady, although she just had to deal with two angry customers who tried the only computer at the floor but could not get access to yahoo or hotmail. I believe it must have been the internet filters again, since they had no problem in getting access to Chinese websites. The lady told me there was wireless access on her floor, but that I would have to remain connected all the time. When I would lose my connection, I would have to purchase a new card.
That sounded less attractive, but I decided to check there system out. I could get in without a problem, without a 100 Renminbi card. Hope the system is still in place tomorrow when I return for the conference.