Can China innovate like Silicon Valley?

Michael Bazeley and Matt Marshall from SiliconBeat (VC Blog) talked with Ronald Chwang (Chairman and President of Acer Technology Ventures, America) about China's ability to innovate.


"... the trick so far has been to apply the innovations here (Silicon Valley) to the market back in China, tweaking products so they fit in with local usage habits, cultural preferences and so on.

But then Chwang says things have been shifting lately. In some areas where China's market size so exceeds the U.S., they're poised to sneak ahead with several technology innovations. Take the mobile phone usage, where China clearly exceeds the U.S. Chinese companies, he says, are developing new ring tone, music/picture/video messaging capabilities not yet seen here. "Just because of sheer population," he says. Short Messaging Service (SMS) is taking off faster in China because of the country's censorship of official newspapers and online news sites. "SMS is China's underground news media," he notes. He predicts new innovations sprouting from that usage. Another area is in DVD media. China already has a higher DVD standard, offering higher quality and more storage capability than the going US standard. And with broadband usage taking off in China, companies are moving aggressively to offer video-on-demand -- something slow to catch on here. So just as Japan forged a lead in consumer electronics, China has potential to lead in several of these new mobile/DVD/broadband areas, Chwang concludes. "