Originally Posted: December 5, 2011.
Adrian Johns begins his history of piracy (of the intellectual property variety) by describing an attempt by a Chinese company to copy products made by the consumer electronics giant NEC. But these pirates had taken things to an extreme, copying not just products but the entire corporate structure of the original:
Their version, like the original, was multinational and highly professional. It agents carried business cards. They were even recruited publicly by what looked like legitimate advertising. The piratical firm had not only replicated existing NEC goods, but actively invested in research and development to devise its own. Over time, it had produced an entire range of consumer products, from MP3 players to lavish home theater systems. These goods were of high quality, with warranties emulating NEC’s own (in fact, the conspirators came to light only when users tried to exercise their warranty rights by contacting NEC). To manufacture them the imposter multinational had signed royalty arrangements with more than fifty busisinesses scattered through China, Hong Kong, and Taiwan, at least some of which seemed to believe they were working for the real NEC. And it had developed its own sophisticated distribution networks, allowing its products to reach a global market extending at least as far as Africa and Europe.
In other words, the fake company had endeavored – and in many ways succeeded – to set up an entire mirror or copy of its Japanese doppelganger. Of course, Johns is interested in this example for what it can tell us about the present state of intellectual property. The concern about NEC-mark-II, Johns argues, is symptomatic of a deep fear about IP theft in a world increasingly dependent on information and its flows. But this story is interesting because of what it can tell us about East-West relations in the twenty-first century. Notwithstanding the fact that this was one Asian company ripping off another, there is a strong perception that piracy represents a siphoning of Western innovation. This continues a long-standing anxiety about Asia (especially Japan) taking Western technology, manufacturing it better and cheaper, and selling it back to Western consumers. As the West become a more and more an ‘information economy’ it is rendered more and more vulnerable to such perfidy. Now China plays the role of the villain.
So, the first thing this story tells us is about Western perceptions of Asian technological development: innovation comes from the West, but Asia is able to capitalize economically by cheating and stealing. Asia is only able to succeed by copying and imitation, the narrative suggests. This reproduces long-held stereotypes about Asian science, and allows the to find a convenient explanation for their worsening economic situation vis-à-vis China.
But what was really being stolen here? The imposter company ended up in many ways outcompeting NEC itself – they had different, new, and perhaps even better products. The technical know-how was of secondary importance. What was crucial was the use of the NEC brand and reputation (‘brandjacking’). Technical knowledge was merely a first step – what was most impressive about the imitation scheme were the adoption of managerial, organizational, marketing, and distribution technologies. As many have learned from Steve Jobs, this ‘packaging’ is often at least as important as the devices themselves. This ‘technological’ copying has evolved into a ‘cultural’ or ‘organizational’ copying too.
But more importantly, this story might tell us something about innovation in China. This mirroring or copying suggests an ability to take advantage of global information flows. This fake firm created a space of unfettered movement and development. Without IP restrictions in particular, Chinese entrepreneurs were free to take advantage of the flows and rapid circulation of information. This is a form of entrepreneurialism in and of itself, adapting and taking advantage of the new lability of information, of globalization, and of the rapid circulation of knowledge: a kind of information arbitrage. This emulation suggests an ability to take advantage of digital flows in a way the West is not or cannot.
Originally Posted: December 5, 2011.