The Inquirer-Home

You can't trust the Chinese, says chip boss

Intellectual property security a 'massive issue'
Wed Jun 30 2010, 10:09

WESTERN COMPANIES operating in China cannot rely on local staff to keep secrets, an executive from one of Britain's top chip design firms has warned.

"[Intellectual property] security is a massive issue," said James Collier, CTO of wireless and GPS specialist CSR at The Future of Wireless conference in Cambridge.

"All Western companies have massive [human resources] and disciplinary issues if they do development work in China."

He said that, like in so many instances of significant cultural differences, the Chinese have a completely different attitude. "[Intellectual property theft] does not compute as wrong. There is no need to be offensive about it but it does not compute as wrong," he explained.

The problem shapes how Cambridge-based CSR implements projects, "partitioning" intellectual property under an information access system. Any company setting up in China has a choice between making valuable information inaccessible or making it clear that anyone getting unauthorised access would be caught. "We tend to err on that side of the equation," Collier said.

He said that a few trusted employees, often Western trained, are an essential ingredient of offices in China and India, where the problem is less acute. "But one has to move away from the open and trusted system in Cambridge where everyone has access to the information."

Collier, in a talk on international business opportunities, also said staff in development centres located in emerging economies are not necessarily cheaper. Technician-grade employees in India are relatively low paid, but the difference in pay scales becomes less at other levels.

The US is the most costly but staff there tend to have a lot of experience, having worked most of their lives in a particular field. By contrast staff in India tend to have less experience but in a variety of work. µ

Share this:

Comments
REALLY FIRsT HAND

I don't have to read any further, as I lived in Chinatown in NYC for 15 yrs. They were hard workers for $$, slobs, rude, only cared about their families, could not speak English? but (could sell anything) BUT knew how to count back pennies. I was educated first hand. As a result, I do not trust them beyond selling me brocolli at their street vendors.

posted by : Gail, 05 July 2010 Complain about this comment
The Trust is... No Company Could Be Trusted

Anyone who claims there are any companies in this world that's honest and not corrupted is either lying or delusional.

If a company can get away with doing something wrong, it most definitely will.

posted by : Chris, 01 July 2010 Complain about this comment
@dan

"Bravo for China" ? "Intellectual Property is a false idea introduced by corporations" ?

Ok, you're Chinese (or North Korean). It's pretty naive to believe it's ok to steal an IC design or IC process that took years of effort and hundreds of millions of dollars to develop.

Without legal protection, corporations won't spend millions of dollars to create something if everyone is allowed to just copy it and avoid development costs.

But, then, I expect a thief to pretend he wasn't doing anything illegal.

posted by : Hector, 30 June 2010 Complain about this comment
So True

having worked in China I can tell you two things about their business practices that caught me off guard. 1) You will NEVER get the last payment. Just doesn't happen that way. 2) You are selling not just the product you have but also the process it was made from and the engineering behind it. Regardless of what the contract says or who's hand you grasped.
They had dozens of excuses, from balancing cheap labour coststo cultural differences, but what it comes down to is comtempt for Westerners and our business practices. AS I was told by one project manager "... and you can't complain because you are white and it would just be racist..."
My company no longer does business in china and had focused on South America instead where the idea of honour and ethics still exists.

posted by : Boge, 30 June 2010 Complain about this comment
The whole "equation" would include

that those in Cambridge all have a direct interest in profiting from Chinese labor, blithely expect the Chinese to work *solely* for foreign interests, for less reward than those in Cambridge get, and the (particular) Chinese should even be grateful to be exploited, because Cambridge can pick another bunch of cheap laborers, perhaps in India. From the Chinese (or labor) point of view, the design part is kind of minor compared to producing *actual* goods, so the information isn't all that valuable without the "means of production". Classic capitalist schism pitting labor against management, just hidden by distance.

My idea for a solution to the topical "problem" is that the Chinese employees should share in the profits, not be regarded as replaceable machinery played off against others -- with all profits going to an already leisured class of stockholders who never have to even learn technology, or put themselves at hazard of industrial dangers and tedium, it's all kept far away safely out of their privileged view, and heck, they're even giving poor people a job.

The Chinese are certainly going to "fix" the topical problem in the near future. Just this week, Chinese industrial production may have passed that of the US, and as ideas are in fact the easier part of production, it's Westerners who will become redundant.

@dan: I agree with your goals, but I think the way to achieve that is simply steeply progressive income taxes on the rich, to keep *some* limit on their excesses.

posted by : bigger_luddite, 30 June 2010 Complain about this comment
bravo for china

"intelectual propriety" is a false ideea introduced by corporations. yet another ideea to control people.

I want to see corporations pay intelectual propriety rights for: use of wheel, use of transistors, use of electricity, use of cement(to china).. and so on. Now they evan claim intelectual propriety over colors, over plants, over words....

I want to see musicians pay intelectual propritey for all music that they modify, use as inspiration be it clasical or folk music; to pay for use of guitar, trumpet, saxophone...

posted by : dan, 30 June 2010 Complain about this comment
aboutus
Advertisement
Subscribe to INQ newsletters
Advertisement
INQ Poll

Facebook starts selling shares

Will you buy Facebook shares?