HK must introduce innovative technology model
HK must introduce innovative technology model that works at home and markets abroad
It is no coincidence that Hong Kong and mainland China are rolling out ambitious technology policies at the same time.
Government planners in both places are either hoping to catch up with US technology or create high-value employment for young graduates. However, none of these policies can exist or succeed alone in a vacuum. Competitive and market forces make their goals elusive, creating unintended outcomes.
One of the jokes during the 1990s tech boom was: “What was Microsoft’s corporate mission statement? Prevent the formation of other Microsofts.” Therein lies the seeds of destruction of any technology and the dynamics behind creativity in Silicon Valley. Bill Gates hoped that no offbeat entrepreneurs would emerge to unravel his near monopolistic dominance of desktop computing.
But of course that happened. History shows that somewhere out there, someone is inventing the next new thing in their garage, and there is nothing you can do to stop them. Today, Google, Apple and Facebook and others have replaced Microsoft as highly regarded leaders.
Shaping policies or choosing winners in an industry that has thrived on constructive destruction is as difficult as catching lightning in a bottle.
As the new technology bureau of the Hong Kong government tries to understand its role in fostering innovation in the post-%Occupy economy, its most basic decision is whether it should bet on certain industries or confine itself to making policies that support technology and entrepreneurs.
The critical difference that Hong Kong and mainland government planners fail to understand is that Silicon Valley’s leading technologists are trying to develop businesses that are so profoundly innovative that they create entirely new industries.
Search engines, mobile devices and social media have changed the way humans live and work. Radical ambitions require a certain defiance, disregard for authority and conventional thinking.
And that is the crucible for the irrefutable confirmation of America’s leadership and domination of every major innovation in information technology. It is the kind of success that every government has sought but cannot mandate. You can’t teach it. You can’t buy it.
So rather than playing the role of a fund manager, Hong Kong’s technology bureau should formulate supportive investment and social policies and then step out of the way.
If Hong Kong was meant to have a technology sector, then someone toiling away in a public housing flat will emerge as its leader. Government grants and subsidies are no guarantee of success. After all, many tech companies move from low-tax jurisdictions to Silicon Valley even though taxes are higher and traffic is congested because they need to access global talent.
Looking to mainland China for examples of successful high-growth tech companies appears to be an obvious route for Hong Kong. However, the paradox of large mainland Chinese internet companies like Alibaba, Tencent or Baidu is that they may only be successful domestically.
So far, it appears that the mainland Chinese corporate model of fully cooperating with the government and gaining formal and informal support from it by doing whatever it takes to please it, including violate personal privacy, does not work anywhere else but on the mainland. It may be necessary and legal in China, but it is anti-ethical to Western values.
The result is that overseas, Alibaba’s brand remains tainted by its misappropriation of Alipay from Yahoo and SoftBank Corp, and its plague of fake products on its sites.
Ironically, notwithstanding chairman Jack Ma Yun’s showmanship, there could be no other market outside China for Alibaba. It might compete with or even buy Amazon, PayPal or eBay, but it may not have the reputation and managerial skills to run them and make the corporate cultures fit.
There could simply be no overseas markets for Chinese internet companies, especially since most of them are copies of existing foreign companies and when they owe their success to government protection. This could be the ultimate fate that investors realise for this business model.
For Hong Kong, finding its own technology model that works at home or abroad is also important because it must embody a much-needed chance for the city to reinvent itself and offer its post-Occupy generation the possibility of reaching their full potential. After all, how much can you promise a prosperous future and then not really be able to deliver before the people rise up and say, “Enough”?
