Chinese Piracy. Arrrrr...

Kirt's Cogitations™ #196

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Chinese Piracy. Arrrrr...

"To steal a book is an elegant offense." That is an old Chinese saying that gives rise to the mindset prevalent in much of China permitting the rationalization for unbridled copyright and patent infringement amongst the population. According to the Business Software Alliance, 92% of all software loaded onto PCs in China in 2003 was illegally obtained. The Motion Picture Industry estimates that only 5% of movie DVDs sold in China are legitimate. A pirated DVD costs around 80 cents - "...literally cheaper to buy than a bowl of rice." In fairness, I will point out that software thievery in the U.S. is estimated at around 22% and in western Europe at 36%. However, unlike in the U.S. and western Europe, China only very recently has begun to pass legislation making piracy a crime. They did so only due to extreme pressures applied by international trading partners. Life behind the impenetrable Iron Curtain justified just about any form of exploitation of the rest of the world's accomplishments.

If it were not so utterly serious, some of the shenanigans would be downright comical and worthy of praise for the perpetrators' sheer ingenuity. Take for instance the Kentucky Fried Chicken franchise in a northeastern Chinese city. While on a trip to China scouting out potential locations for a KFC restaurant, a corporate team from the U.S. came upon one already in operation. Employees wore the proper uniforms, the logos were faithful replicas, the menu duplicated the ones back home, and even the cardboard likeness of Colonel Sanders that greeted hungry Chinese customers at the door was the spitting image of the founder himself. It was a model operation from top to bottom. The only problem was that the entire business was an illegal facade with no ties whatsoever to the real KFC.

Then there is the Cherry Automobile Company's knockoff of the Chevrolet Spark. According to reports, the car is an exact copy from "headlights-to-tailpipe." A lawsuit brought by GM Daewoo & Technology Company, of Inchon, Korea, was required to put a stop to it. Many of the offenders are not easily intimidated even when confronted directly by legitimate complainants. Even the state-run prisons have been caught producing Sony PlayStation 2 game console replicas to the tune of 50,000 copies a day (that's right, 50k)!

As the U.S. and other countries pour seemingly endless amounts of technology in the form of hardware and intellectual property (IP) into China, the potential for exploitation grows with equally endless bound. It is no conspiracy theory borne out of paranoia that claims China's Red Army, still sworn to old ideals of world domination, has agents engaged in sabotage and trade secret theft clandestinely installed in factories and corporate headquarters all over the globe. Back in "the good old days," Iron Curtain countries like the Soviet Union states and China relied on procuring advanced microchips by removing them from scrap products obtained from the outside world. I still remember the news about the discovery of huge shipments of talking dolls going to the former USSR for the purpose of removing the speech synthesizing ICs. Today, Pentium-quality processors are manufactured right in China. Factories for developing and assembling state-of-the-art aerospace technology for advanced fighters and bombers, satellites and ICBMs have been provided by Western corporations and governments for two decades. It is a military build-up planner's dream come true.

Being generally an optimist, though, I see an upside. As the Chinese people gain access to the rest of the world through exposure in the factories, foreign movies, radio and television broadcasts, and ever-increasing freedom of travel, they are becoming desirous of more of the creature comforts and freedoms that they witness elsewhere. A new generation took its first real stand against the oppressive and empirical iron fist of the Communist government at Tiananmen Square in 1989. Brave young souls lost their lives there in a wanton and public slaughter by the Red Army at a time when ubiquitous communications was getting a foothold, and the 24-hour news cycle was beginning to take off. The genie was out of the bottle, so-to-speak, and the world could see the brutality of the Communist system. Nearly simultaneously, Berlin's famous east/west wall of separation between freedom and oppression was crumbling.

Hopefully, this budding free and open society that seems to be the general populace of China will be less willing to indulge the breast-beating, saber-rattling generals of the old guard. Maybe most Chinese citizens do not really want to risk nuclear war with the United States by attempting to attack Taiwan. Maybe most Chinese citizens do not really like their government abetting other cruel Communist regimes like North Korea, just to be a finger-in-the-eye of the U.S. and Europe. We can only hope this is the case. Until we know for sure, though, we must protect our interests by seriously considering which types of technology and how much of it to hand over. After all, you would never give a suspicious-looking stranger a loaded gun.