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Baidu: Page not Found

Tuesday, January 12th, 2010

Wow. Baidu.com has been hacked this morning around 9:30 and is just back on at 3pm. More than 5:30 hours downtime.

Worst of all, they have no way to hide it was a hack, even the People’s Daily published the picture. Perhaps the party media does not consider websites as part of China’s glorious industry and it is not concerned with covering up. Not like they could have hidden it anyway, but I find it interesting that they didn’t try:

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This reminds me of yesterday’s article on Caixin, coincidentally titled: Page Not Found. It explains the very unusual situation of a Chinese internet  industry that is averse to innovation.

But in addition to the domestic environment’s impact, rottenness inside the industry deserves some blame for the crisis. Whirlwind development led to stories of overnight riches, which in turn attracted a significant number of unqualified entrepreneurs with questionable motives. The industry now looks at innovation as risky, while copycats seek instant success with online games, cheap content and plagiarism. They exploit regulatory loopholes or do business in the economy’s gray zone.

I don’t want to read too much into a simple incident, but it is kind of a big deal in the first Chinese Nasdaq company, a website ranked N1 in China and N8 in the World. I can’t help feeling that Baidu have been too long sitting on their cozy market share and government protection, selling search results or luring in users with copyrighted mp3 for download. Instead of innovating and improving their security.

To be sure, Baidu also brings out some new stuff once in a while, and I quite like the Baidupedia to look up Chinese things. But when you compare with Facebook, Twitter or Google, you see those companies are constantly taking risks to try out new ideas, while Chinese sites tend to sit around and copy. I mean, surely you can’t run an internet company like you are running a steel mill?

Just a coincidence, probably, but the COO of Baidu stepped down yesterday “for personal reasons”.

H/T Danwei and CDT.

UPDATE: It is 7pm and baidu.com is still on and off. The rest of the services, baike, mp3, etc. all work properly and can be accessed through baidu.cn, but the main page is down at this moment.  Downtime close to 10 hours already.

Who gets Rich in China? and the Expat Trap

Saturday, May 23rd, 2009

Last year I wrote a post about foreign entrepreneurs in Shanghai that included a Big Question with a link:  Who gets rich in China? The page attracted a ridiculous amount of search engine hits considering its dumb content, which proves that it was indeed a hot question. Time passed and I never got around to writing more, but my intention was just to echo the phrase I so often hear from disgruntled expats:

“Who gets rich in China? The Chinese!”

I am afraid I don’t have a better answer now than I had then, but recently I’ve been talking business with some entrepreneurial friends, and one problem has come up so many times that I think it is worth a post. And I hope this is useful for foreign start-ups in China to avoid making a bad decision from day zero and ending up, a few years down the line, mumbling the bitter phrase. The problem I refer to is the market dilemma, otherwise called the expat trap. Click to continue »

Capitalism with Chinese Characteristics

Monday, March 2nd, 2009

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Today I am starting my review section with one of the books on Chinese economy that has impressed me most in the last year, “Capitalism with Chinese characteristics”, by MIT professor Huang Yasheng. It is a book that clearly stands out from the recent China books, and it might be destined to become one of the big references in the field.

There is no shortage of good China books in the last years. Many are written from a business perspective, by people with first hand experience who will tell you exactly how things are done here. Others look at the available economic data and build interesting theories to explain them. Few go deeper than this, to look into the heart of the matter: the politics behind the Chinese economy.

The problem is:  it is so difficult to obtain reliable information on Chinese policy that most efforts in this field turn into circular arguments over the same limited data. Professor Huang breaks the circle by going back to the sources and questioning directly all the mainstream assumptions, leaving many of them upside down. The situation in China requires this approach, as he says in the preface:

In studies of American economy, scholars may debate about the effects of, say, “Reagan tax cuts”. In studies of the Chinese economy, the more relevant question would be, “Did the government cut taxes in the first place?

By going back to the archives of what, in his own words is “some of the world’s most medieval record keeping”, Huang Yasheng is able to come up with a whole new picture of Chinese economic policy in the last three decades. This book is the result of painstaking archival research into rarely examined files, such as a “22 volumes compilation of internal bank documents” or the archives of the Ministry of Agriculture.

A qualitative leap from the classic tea leave reading, and one that deserves some careful consideration, even if the conclusions drawn will not be to the taste of every reader. Click to continue »