In February this year a landmark White Paper report from the China Academy of Telecommunications Research landed on the desk of the country’s Minister of Industry and Information Technology. It noted that Google’s Android mobile operating system had an “alarming” 90 per cent market share in China’s booming smartphone market.
“Our country's mobile operating system research and development is too dependent on Android," it said.
The report criticised Google for hindering the development of Chinese mobile operating systems by delaying sharing code and manipulating firms through commercial agreements.
This was doubly offensive to China which thought it had seen off Google after a stoush over censorship in 2011 saw the US company belatedly live up to its motto of “do no evil” and stop. Since then, its search business in China has been decimated. It shifted its China servers to Hong Kong, it had been crunched by local hero Baidu in the search market and Gmail has been rendered all but unusable on the Chinese mainland by technology that can slow individual websites. Android had emerged as Google’s quiet revenge in an increasingly mobile-centric world.
Within weeks, China was laying the groundwork to create its own mobile operating system(s), part of the ruling Communist Party’s recent policy of “indigenous innovation”.
The White Paper had already praised local firms Alibaba, Huawei and Baidu for their efforts to develop their own mobile operating systems, noting "While the Android system is open source, the core technology and technology roadmap is strictly controlled by Google."
The project will have been given something of a hurry-up by the recent revelations of US spying on China by CIA whistleblower Edward Snowdon. It’s early days and it’s China, so we don’t know much at all but it’s just the latest bold target set by a country desperate to make its mark on the global technology sector.
The only other major player in the mobile OS sector, Apple has already felt the heat of China’s aggressive propaganda machine when it was singled out for a weeks’ long public hiding for the country’s annual Consumer Day in March this year. Apple was sprung using used parts to repair the world’s most expensive iPhones (there’s a healthy trade in smuggling the devices from Hong Kong and other locations) and the state-sponsored smear campaign ended with groveling public apology from Apple CEO Tim Cook. Ouch.
Now the news that the US spies on China - coming hot on the heels of a series of admissions by US corporations that they had their email and systems hacked by the Chinese - and that governments all over monitor our electronic lives should really come as no surprise to anyone who has seen the television series 24 or any number of movies dating back to Francis Ford Coppola’s 1974 masterpiece The Conversation.
What the revelations do is give China some measure of legitimacy in its quiet but escalating program of ripping out gear made by US vendors such as Cisco Systems. The Chinese language National Business Daily recently reported that China Unicom was doing just this. Cisco, naturally, regularly denies that such events could possibly occur. Now this has been ostensibly in response to the ban by the US government on the installing of Huawei equipment into Huawei has been China’s stand out corporate success story and one of the world’s big tech stories for the past decade.
But Huawei’s success has rested on doing what its competitors – Cisco, Ericsson, Alcatel Lucent, Nokia Siemens, Juniper and others – did but cheaper. Following a massive R&D push, it has polished its products and is now competitive at a technology level.
At the same time the Chinese government was embarking on its program of making homegrown technology platforms. Sensibly enough, it started at the hardware end: heavy load bearing network pipes, towers and switches. The basic idea was to get that right, then move up the value chain into network software and handsets and now, handset operating systems.
The first stab at this was TD-CDMA, China’s homegrown 3G network. It works, but not nearly as well as WCDMA or even CDMA-2000. The country’s biggest network China Mobile, with more than 700 million customers the world’s biggest, was saddled with the technology as part of an early effort. Apple has never optimised the iPhone for this technology despite constant rumours ahead of each new release, perhaps another reason for its recent public flogging.
Huawei and Chinese rivals such as publicly listed ZTE – which still has a substantial government shareholding and receives favorable government treatment and access to cheap financing - as well as foreign firms, like Alcatel, Ericsson and Siemens also bought into the TD-CDMA game, eyeing the vast Chinese population and geography.
By all accounts the 4G (Long Term Evolution) upgrade known as TD-LTE (Time Division LTE) is much improved. In early June Singtel Optus launched services on a planned TD-LTE Capital city network in Canberra.
China is following the age old North Asian technology model adopted first by Japan then followed by Taiwan and Korea; copy, improve, start to innovate. Toyota, Sony, Hyundai, Acer, Asus, LG and the latest star Samsung – to name but a few - are all testament to this strategy.
It’s not just Huawei and ZTE in networks, there’s Lenovo in personal computers, Baidu in search, Sina in microblogging, and Tencent in social networking and mobile applications the latest being the Whatsapp copy WeChat (known as Weixin in China). Download a copy, it’s got more functionality than the original (but careful China might be spying on you). China has a staggering 105 dedicated technology parks around the country.
China’s technology ambitions are boundless and range across the whole spectrum from military innovation such as the aircraft carrier stopping missile (so far untested) to nano- and bio-tech. Right now a new mobile operating system that can make some waves looks like a big ask; seeking success where the mighty – Nokia and Microsoft – have fallen.
But I remember all the scorn being poured on the computer and digital walkman maker Apple ahead of the launch of the iPhone by the likes of Nokia and Motorola. Just look at them now.
China is desperately craving a homegrown technology breakthrough. It may not be the mobile OS that cracks it for China but with deep pocketed firms like Alibaba, Huawei and Baidu on the case - and the government behind it - write it off at your peril.
Michael Sainsbury is an Asian based freelance journalist who was nominated for a Walkley Award for his writing on the telecommunications sector and the winner of countless IT Journo Awards. He has lived in Beijing for the past four and half years and was China correspondent for The Australian from 2009-2012.
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