Bunnie Huang on China's "Shanzai" Mash-Up Design Shops 181
saccade.com writes "Bunnie (of XBox hacking and Chumby fame) has written an
insightful post about how a new phenomena emerging out of China called
'Shanzai' has
impacted the electronics business there.
A new class of innovators, they're
going beyond merely copying western designs to producing electronic "mash-ups" to create new products. Bootstrapped on small amounts of capital, they range from
shops of just a few people to a few hundred. They rapidly create new products, and use
an "open source" style design community where design ideas and component lists are shared."
Re:Smart; Very smart (Score:5, Interesting)
Our IP is getting in our way. That is why our forefathers created SHORT TERM IP rights. Now, it is just a money maker for a bit longer, but is KILLING the west.
Not to mention the 150 year-after-Disneys-death copyright. That really helps preserve the wealth of the rich, but at the cost of a stagnating society.
Remind me again, how did Apple start? (Score:5, Interesting)
Remind me again, how did Apple start?
I think that this sounds more like a new type of consumer-producer than just piracy, and that the "mash-up" is an apt comparison.
These guys may end up revamping a part of the market with their "hardware shareware", and if they do, I say more power to them. Especially since they are doing more than just plain copies, they are producing products that are, arguably, "improved" models.
Quoth the article, "contemporary shanzhai are rebellious, individualistic, underground, and self-empowered innovators" ... which one of those does the marketplace *not* need? (Mark you, I say "need", not "want"; I'm quite sure they want none of it, but will nonetheless have more of it than they like.)
Re:The solution (Score:3, Interesting)
bunnie says:
I did look into the prices of equipment in china and they are about 20-50% that of used equipment bought in the US.
The problem is that shipping an SMT machine in one piece to the US would not be cheap; compound onto that the tariff Iâ(TM)d have to pay, the zoning issues of putting an SMT line in your house, and the 20-30x cost of labor to maintain and run the machines, and itâ(TM)s not looking as attractive.
The other important thing about that setup is the retail store on the bottom floor. Not only can that guy make stuff, he can move it â" I imagine the equivalent would be getting a retail store in downtown San Francisco with this equipment in there. The rent would be astronomical, and the landlord probably wouldnâ(TM)t allow (or be zoned for) mixed living, manufacturing, and selling.
Re:MBA shortsightedness (Score:5, Interesting)
You joke about this but it does happen. I've worked on projects where there are people working all over the place. E.g. Euro/US company designs something and manufactures it in China and the software is done by an Indiam company.
So far, so conventional. But the Chinese are often just assembling parts that come from the US (e.g. processors from Intel, components from Europe, displays from Korea and batteries from Japan) and immediately exporting them. And the Indian company might subcontract work back to Europe or to the US. It's simplistic to say that work has moved from Europe/the US to China/India, it's more accurate to say that China and India have joined in networks that were global before.
And it's also simplistic to say that jobs are always moved from high wage countries to low wage ones. I've seen projects move from the US to Northern Europe for instance, or from Eastern Europe to Western Europe.
The other thing is that labour costs aren't everything. If you have an efficient company making components they are a tiny fraction of your gross sales. Finally there's a pecking order in terms of where the money ends up - and low wage low skill places are not very high in it. A factory in China makes a tiny percentage of the sticker price on a laptop - most of it stays in the country it was bought or was used to buy parts for import. Most of those Indian consultancy companies are going to end up going bust because they bill several clients for one hour of developer time and thus have a low perceived productivity. The few good ones that survive are quickly going to start charging the same rates that US or European companies charge.
Back when Indian and China opened up I thought it would gut engineering in rich countries. That hasn't happened and my few trips to both places tells me it won't happen. Probably consultancy rates would have been 10% higher if they weren't there, if that.
Re:USA is losing because we think we're winning (Score:3, Interesting)
We are more governmentally encumbered and less capitalist than China in many ways!
Funny you should say that. To my mind this is the spirit of socialism at its best - the people at the bottom working together rather than each individual competing against each other. Open source is another prime example of what socialism and communism was really about before powerhungry egomaniacs like Stalin and Lenin took out a patent on the idea.
Brute-forcing the market = new innovation (Score:2, Interesting)
The way these companies are trying to find winning combinations in the market is very simple, they iterate through 2,3,4-dimensional space of gadget combinations.
Righ now it seems they are at stage 3, combining 3 things together for instance usb-mouse/heater/skype handset.
It is just their way of "innovation", they have almost infinite resources - money, people, factories so they try different combinations.
Kind of like brute-forcing crypto key instead of finding weakness in algorithm.
Re:USA is losing because we think we're winning (Score:2, Interesting)
Re:USA is losing because we think we're winning (Score:3, Interesting)
Because the first world is scared of the low-wage Wirtschaftswunder which Japan, Korea, Taiwan etc showed us. Only there is over a billion people in China. 10-20 years more and the next billion, the Indians, join the party for real. And by _that_ time, the Africans will be where China & India are now.
Where the former first world will be is anybody's guess, really.
I can understand both 'their' and 'our' pov.
Re:USA is losing because we think we're winning (Score:3, Interesting)
communism hasn't worked anywhere
Most families are working models of communism - the family shares its possessions etc. It's true that many of the states that have called themselves "Communist" have failed, most notably the Soviet Union, but the question still remains whether this was because of communism or because of other factors - such as the permanent state of conflict with the Western world, the general incompetence of its leaders, the extreme paranoia of the same or whatever. I would say that it is impossible to have a stable society that is based on constant oppression of the majority, there is nothing inherent in socialism that requires oppression.
The argument one sees elsewhere, that oppression becomes necessary "because there will always be some that are too selfish", is only valid in the special case where the state insists on an extreme form of "perfect" socialism; but that is the same whether you insist on pure capitalism, theocracy or just about anything else. If deviation from the ideal is not tolerated, oppression becomes necessary.
There are many stable countries in the world that are predominantly socialist - Scandinavia springs to mind, but China is a good example; China is still a communist society and likely to remain so for the foreseable future, not despite its opening up to the international community, but because of it. The openness has taken away much of the oppression and people don't feel the need to revolt.