Linked by Thom Holwerda on Wed 4th Jan 2012 18:28 UTC
PDAs, Cellphones, Wireless Hold on to your panties, because this should come as a surprise: I'm actually agreeing that Samsung is copying Apple. The Korean company just released a new entry-level Android smartphone, and it's called the Samsung Galaxy Ace Plus. While Apple's previous complaints regarding Samsung's supposed copying were obviously nonsense, this Galaxy Ace Plus, on the other hand... It's almost as if Samsung is giving Apple the finger by copying the iPhone 3G(S) almost verbatim.
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Its a cultural thing
by frderi on Thu 5th Jan 2012 00:55 UTC
frderi
Member since:
2011-06-17

Rather than just pulling the 'I told you so' card (because I have, multiple times), I'd rather shed some light as the how and why.

It is, to a large extent, a cultural thing. Asian mentality in this regard is totally different than western mentality. For most Asian entrepreneurs, anything that is producable is a feasable product, patented technology or not. Its just not in their mindset to take IP into account. If you can make it, anything goes, no matter the consequences. If it generates profit, you produce it, as simple as that.

Asian companies have been in the copying business for decades and to a large extent it is what made these economies in the first place, winning market share by competing on price because of the low-wages advantage. A lot of the current Asian conglomerates were built on copying technology from the West. Japan was one of the first to do this, with the copies of German reflex cameras being a notable example, export cars being another. Fast forward 7 decades, and their automobile industry is eclipsing that of the West.

I can give another more recent testimony that illustrates this mentality quite aptly. While working in Asia a couple of years ago, I met a project manager who was active in the mobile handset business. He told me this account from a company he knew who was producing high-end spectral analyzers. Suddenly, this company started receiving phone calls of customers with support questions about units unknown to them. After tracking down where they came from, it turned out they were produced by a small Asian company. The devices were copied to the most minute detail without any compromise on build quality, so they were indistinguishable from the original, albeit sold cheaper. The snag was, of course, that unlike the Western company, the Asian producer nor their dealers had the proper knowledge on how to operate the units, leaving customers out in the cold once the unit was sold.

Being in the phone business, he also let me in on some pretty interesting facts about mobile handset makers in the region, and what they were up to in response to the iPhone, which was just hitting the market back then. Fast forward to the present and a lot of what he told me all these years ago is visible in the marketplace today.

One also needs to contemplate about the macro-economical consequences. The western countries (USA, UK, EU) have the biggest trade deficits in the whole world. This means that a lot more wealth leaves our economies than they can attract. Which essentially has the consequence that a lot western-generated wealth leaves our respective economies. In the past, we've compensated this by innovation, but since a lot more manufacturing ends up in developing economies, including our own, the time span from launching an innovative product and it ending up being economically nullified because of commodization is becoming shorter and shorter, reducing the economical advantage even more.

These facts are putting a huge mortgage on the future of Western economies and one has to take into consideration the long-term consequences for our respective economies. I know from a historical standpoint the West is notoriously bad at this, I can attest to you, the decisions made in the East have the long term in mind.

When the money runs dry in our western economies, what will there be left to us, western people? I don't think anyone with the proper business knowledge will argument that emerging economies like the chinese will come to the rescue. One only has to look at their business practices on their own market and in Africa to know what we're up against. China is building its market mainly for itself, thank you very much, Western companies need not to apply. China's market has proven to be a very hard nut to crack as local companies will always get the preferential treatment.

Africa won their independence from western colonists only to end up being enslaved by developing economies like the Chinese, and have been way worse off as a consequence. Hippie stances as "we are all children of the earth" and "share the wealth" are all nice and dandy when bread in the wealth of the accomplishments of our previous generations, I can assure you that Asian enterpreneurs do not share your vision. They are looking at it from the "protect whats ours, find ways to acquire more" perspective, and they have their eyes keenly fixed on the West. Being deliberately naïve about this only makes you deserve what's coming to you.

I hope this testimony will lay to rest some of the pipe-dream ideas that have been floating around here that the free economy aspect ends up being better for innovation as a whole, and that the race to the bottom benefits the end user. One only needs look at 25 of years race to the bottom in the PC industry. When you work at bottom prices, innovation ceases. Parotting products cheaper does not produce a better product, it just means that markets end up being owned by companies who do not understand them. It simply makes no sense from a business perspective to innovate in a market when margins are marginalized. Products are way more than the sum of their parts, or the sum of their features. To properly design a good product is what generates customer value, and wealth.

The $399 junk PC's in the nineties did not end up putting a lot of value in the hands of the users, either.

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