Tag Archives: technology

China’s Technology Ambitions Could Upset the Global Trade Order

BEIJING — When President Trump arrives in Beijing on Wednesday, he will most likely complain about traditional areas of dispute like steel and cars. But Washington officials and major global companies increasingly worry about a new generation of deals that could give China a firmer grip on the technology of tomorrow.

Under an ambitious plan unveiled two years ago called Made in China 2025, Beijing has designs to dominate cutting-edge technologies like advanced microchips, artificial intelligence and electric cars, among many others, in a decade. And China is enlisting some of the world’s biggest technology players in its push.

Sometimes it demands partnerships or intellectual property as the price of admission to the world’s second-largest economy. Sometimes it woos foreign giants with money and market access in ways that elude American and global trade rules.

When concerned officials in Washington began blocking China’s ability to buy high-end technology last year, one American company found a way to help its Chinese partner around those limits. The company, Advanced Micro Devices, avoided scrutiny by licensing its exclusive microchip designs, rather than selling them.

The Chinese partner got access to the technology to make its own products. Advanced Micro Devices got a big payout.

The rules of global commerce are changing — and China and the United States are racing to create a future that aligns with their own distinct visions. The result could be an overhaul of 20th-century trade rules for a 21st-century global economic order, in which money, ideas and influence could become as closely watched and tightly regulated as hard goods packed on a ship and sent abroad.

Even before the Communist Revolution, China obsessed about absorbing foreign technology as a way to end a century of humiliation and restore its national strength. But Made in China 2025 is more ambitious than anything the government has ever attempted, a national industrial policy that aims to project a new type of global might and influence.

China is directing billions of dollars to invest in research at home as well as to acquire innovative technology from abroad. A Beijing-directed semiconductor fund is thought to have more than $100 billion at its disposal, while another plan aims to grow China’s artificial intelligence companies into a $150 billion industry by 2030.

Such efforts have some American government officials and business leaders calling for a rethinking of how the United States approaches trade. Lawmakers are pushing for tougher rules on technology purchases, which do not usually cover the types of deals that China increasingly prefers. Officials are also investigating whether China is stealing intellectual property.

“There are a few U.S. companies that have been leaning too far about sharing technology with countries that are potential enemies of ours,” said Wilbur L. Ross Jr., the United States secretary of commerce, in September remarks regarding information technology that were widely seen as referring to China.

“I don’t think that’s a very good idea. I think it’s the ultimate short-termism to give up very valuable I.T. in order to get a few quarters or a few years of improved sales.”

Robots and Rice Cookers

China looks to the West for much of its technology. Even some of its most sensitive systems that run government computers, banks and laboratories use chips from Intel and Qualcomm and software from Microsoft or Oracle, a dependence it sees as a long-term vulnerability.

The government hopes to change that. It is backing the effort with money: $45 billion in cheap loans for its companies, $3 billion for advanced manufacturing efforts and billions more in other financial support, according to the Mercator Institute for China Studies, a German think tank.

Made in China 2025 “is going to have substantial resources and focus devoted to it, especially at the local government level,” said Kai-Fu Lee, a prominent venture capitalist in Beijing.

The goal is not simply to beat the United States. China is preparing for a day when cheap manufacturing no longer keeps its economy humming. It wants to embrace industries offering skilled jobs that do not blacken its skies and cloud its rivers.

The plan itself has specific targets and quotas. By 2025 it envisions China meeting nearly three-quarters of its own demand for industrial robots and more than a third of its demand for smartphone chips. Other targets cover new-energy cars, like electric cars, and high-performance medical devices.

The template for Made in China 2025 was cribbed from a German government plan called Industrie 4.0, which calls for greater automation and the growing use of “smart factories” doing sophisticated work with fewer people. And the deal that woke up the world to China’s plan was a German one.

Last year, a Chinese appliance maker called Midea struck a surprise $3.9 billion deal to acquire Kuka, an advanced robotics company in Germany. The deal made Midea — best known for its refrigerators and rice cookers — a major player in automation.

“Our partnership with Kuka is actually about whole factory solutions,” said Irene Chen, a spokeswoman for Midea.

Where technology cannot be purchased, the government wants Chinese companies to extract it from foreign firms through deals or tough new laws.

China will soon require foreign auto companies to make electric cars there if they want to continue selling gasoline-powered vehicles in what is now the world’s largest car market. General Motors, Volkswagen and others have been scrambling to form joint ventures with Chinese partners to do so.

Cybersecurity laws enacted this summer give the Ministry of State Security the power to conduct security reviews of technology sold or used in China, said James A. Lewis, senior vice president of the Center for Strategic and International Studies. Such a step could require companies to expose some of their most valuable secrets.

At some companies, Chinese security officials conduct the inspections in corporate “clean rooms” in the United States, with the Chinese officials traveling on business visas, Mr. Lewis said. The companies argue that the access takes place under controlled circumstances that limit what Chinese officials might learn.

“If American companies have a big market in China, they say to the Ministry of State Security, ‘Come in,’” Mr. Lewis said. “Everyone fears retaliation. No one wants to lose the China market.”

Old Rules, New Products

Wary of the push, the United States has used existing rules to stop Chinese purchases of foreign businesses in areas important to national security.

But many of those tools do not apply to today’s deals, as A.M.D.’s Chinese pact shows.

A.M.D.’s joint venture with its Chinese partner can be found in a gleaming industrial area of the city of Chengdu called Tianfu Software Park.

The park represents Beijing’s vision of the future. Trees and sidewalks jammed with ride-sharing bikes sit beneath a vast strip of office towers, hotels and apartment complexes. Offices of China’s most innovative companies, like Huawei and Tencent, sit next to outposts of their foreign analogues, like SAP and Accenture.

Inside one of its glass towers, A.M.D. works with its Chinese partner, a company called Sugon, to produce new chips.

Under the nearly $300 million deal, A.M.D. agreed to license chip technology to a Chinese joint venture with Sugon to make chips for servers. Because A.M.D. controls that joint venture, the technology is considered to remain in American hands.

But A.M.D. struck a second partnership that the Chinese company controls. That joint venture works on applications such as integrating the chips with servers. The two ventures are on the 11th and 12th floors of the same building.

Experts say the dual partnerships could help China develop a new generation of powerful supercomputers. China already makes the world’s fastest computers, but they run on homegrown chips that cannot read commonly available software for supercomputers. With A.M.D.’s help, experts say, Sugon could develop chips that could make China’s supercomputers more versatile and adaptable and replace those from foreign firms.

“We have worked closely with and been very clear with U.S. government officials on the strategy and specifics of the technology, which is classified as permitted for export,” an A.M.D. spokesman said in an emailed statement. He added that the processors are also lower performing than other options that A.M.D. sells in America.

Executives in Chengdu said there was a firewall between the two joint ventures, and the one outside of A.M.D.’s control was not involved in chip development.

Yet in an interview with the Chinese state news media, Zhang Yunquan, a top government researcher and head of the National Supercomputing Center in Jinan, China, said that Sugon could use the work of the joint venture to make supercomputer microchips. Such a supercomputer would be crucial in designing next-generation weapons systems, according to experts.

“When they first announced the partnership I was shocked,” said Stacy Rasgon, a semiconductor analyst with Sanford Bernstein.

“You would think intellectual property and joint ventures would belong under Cfius review,” Mr. Rasgon said, referring to the Committee on Foreign Investment in the United States, which reviews foreign deals. “It should. It’s surprising it isn’t.”

New Rules for a New Era?

For some in the Trump administration, an 18-year-old book by two Chinese Air Force colonels has become required reading.

Called “Unrestricted Warfare,” the book argues that China does not need to match the United States militarily. Instead China can take advantage of the global economy and the internet to take down its main rival.

Some American officials see in it a guide to China’s plan. Some United States lawmakers are proposing to toughen American takeover laws to evaluate deals on an economic as well as a national security basis. They are also pressing for reviews of licensing agreements and joint ventures. The United States trade representative has also launched an investigation into whether Chinese companies are stealing intellectual property.

“There’s concern that U.S. firms are transacting away their competitive advantages,” said Greg Levesque, managing director of Pointe Bello, a research firm in Washington, and a former executive at the US-China Business Council.

Such changes could ripple through the tech world. Chinese investment often means more money with fewer strings attached. Some tech companies say that is good for innovation. China’s spending on science and research is also growing at a time when the United States government and others are cutting back.

Still, many American companies fear the deck is stacked against them. The United States long believed bringing China into the World Trade Organization, which oversees global trade disputes, would ensure it would follow the rules. But the W.T.O. has proved ineffective when it comes to tech issues.

At a recent dinner event in Washington, an American technology executive held up a dinner plate to illustrate the size of the China market, said a person who was there who asked not to be identified because the event was not public. Then the American executive held up a wine coaster that represented the size of his firm’s business.

The message was clear: American companies are at risk of being muscled out of the market.

“Made in China 2025 seems to reject all notions of comparative advantage and future opportunities for high-value-added manufactured exports from the rest of the world to China,” said Jeremie Waterman, president of the China Center at the U.S. Chamber of Commerce.

“If Made in China 2025 achieves its goals,” he said, “the U.S. and other countries would likely become just commodity exporters to China — selling oil, gas, beef and soybeans.”

By Jane Perlez/NYTimes

Posted by The NON-Conformist

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FCC ends decades-old rule designed to keep TV and radio under local control

Federal regulators have voted to eliminate a long-standing rule covering radio and television stations, in a move that could ultimately reshape America’s media landscape.

The regulation, which was first adopted almost 80 years ago, requires broadcasters to have a physical studio in or near the areas where they have a license to transmit TV or radio signals. Known as the “main studio rule,” the regulation ensured that residents of a community could have a say in their local broadcast station’s operations.

The vote by the Federal Communications Commission lifts that requirement. With the rise of social media, the agency said, consumers now have other ways to get in touch with their local broadcasters.

“Additionally, technology allows broadcast stations to produce local news even without a nearby studio,” said FCC Chairman Ajit Pai.

More from Chicago Tribune

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Why Technology Will Not Solve Our Criminal Justice Problems

Technological and scientific interventions in criminal justice are not always newsworthy enough to draw our attention away from urgent and sensational issues on Capitol Hill. But when a jail in Tennessee promotes sterilization by offering reduced sentences to men who volunteer to have vasectomies, we have to pay attention. The problem is not that one jail implemented a terrible eugenicist policy; it is that stakeholders in the criminal justice system are consistently looking for scientific and technological solutions to social problems, forgetting that—as fivethirtyeight contributor Laura Hudson writes— “technology is biased too.”

In the context of criminal justice, America’s faith in technological interventions is worse than misplaced; it is dangerous.

Consider the innovations of recent years: dashboard and body-worn cameras, next-generation electronic monitors, secret algorithms that help to inform sentencing—these items form an impressive and James Bond-esque inventory. The companies that peddle these products invite law enforcement and the American public to imagine that these devices (or medical procedures like the vasectomy) will solve the problems that plague our criminal justice system. As a writer for the free-market think tank, R-Street Research, claimed earlier this year: “finding solutions to our incarceration problem may require the innovation and cost-effectiveness that only technology can provide.”

Even careful researchers see this technological solutionism as a new and auspicious (if imperfect) trend. For example, Michael D. White’s rigorous study of the benefits and limitations of body-worn cameras begins by noting that: “In recent years, technological innovation has continually shaped law enforcement, from less-lethal devices (e.g., TASER) and forensic evidence to advanced crime analysis.” Americans with differing political ideologies often agree that technological developments will solve social problems—especially in the highly-rationalized areas of policing and punishment.

We have seen this type of thinking before, and a brief history of the electric chair illustrates exactly why it is harmful. In the early-nineteenth century, a consolidated movement to abolish the death penalty implored Americans to question whether a just and modern nation should kill its citizens. Whether is the operative word here. The public debate was couched in terms of ethics, and states decided to update or retain their laws accordingly.

In 1887, Elbridge Gerry and a cadre of New York elite changed this public conversation. This commission published a report—now known as “The Gerry Report”—that surveyed thirty-four methods of execution in the search of the “Most Humane and Practical Method of Carrying into Effect the Sentence of Death in Capital Cases.” These findings inspired New York State’s Electric Execution Act of 1888. But even before it was applied to state policy, “The Gerry Report” had left an indelible impression by positing that a comparatively “humane and practical method” of execution existed.

The Gerry commission, along with other proponents of the death penalty, convinced the American public to stop asking whether states should kill and to start asking how states could kill efficiently and humanely. As I argue in my book, Power Lines: Electricity in American Life and Letters, 1882-1952, this transition from whether to how changed the way Americans perceived the issue of capital punishment, especially in the case of bungled executions. Where a prolonged and painful hanging once encouraged spectators to wonder if the law was unjust, botched electric executions indicated, instead, that the electric chair needed modification.

The history of the electric chair reminds us that new technologies—in corrections, as in all things—are always more than tools. We don’t just use technologies, we also think with them. The danger of the electric chair was not only that it was an imperfect technology, but also that it bolstered the fantasy of perfectibility. Today, when we invest in scientific technological solutions, we buy into a similar dream. Although, as NPR reports, it is important to mitigate machine bias, these measures will not solve our underlying social issues.

Our faith in technology consumes resources and begets complacency. We predict that body cameras will overcome the widespread distrust of law enforcement, although cameras are no substitute for repairing relationships between police officers and the community members they strive to protect. We expect that electronic monitors will reduce recidivism, despite evidence that increased surveillance does not reduce crime. We hope that algorithms might make sentencing objective, but we forget that algorithms are descriptive and recapitulate the racial biases that they claim to redress. Apparently, some even hope that eugenics will solve the school-to-prison pipeline.

As sociologist David Garland argues in his award-winning study, Punishment and Modern Society, “Our taken-for-granted ways of punishing have relieved us of the need for thinking deeply about punishment and what little thinking we are left to do is guided along certain narrowly formulated channels.” When we anticipate a technological fix, we forget that the status quo is not our only option. We must challenge our assumptions about technological and scientific solutions. We could accomplish more by channeling resources into diversionary programs to reduce recidivism. We could invest in prison education or in public education that could address the school-to-prison pipeline at its source. We could confront underlying issues like racism, poverty, and addiction with a robust social safety net. But before we undertake any of these ventures, we have to give up the hope that science or technology will save us from ourselves.

by JENNIFER L. LIEBERMAN/CounterPunch

Posted by The NON-Conformist

Apple Puts Up $50 Million to Increase Diversity in Tech Industry

Posted by Libergirl

TIME

It’s a big week for Apple. On Monday the iPhone-maker unveiled the latest addition to its ecosystem of devices, a smart watch whose price will range from $350 to $18,000. On Tuesday, the company kicks off its annual shareholders’ meeting in Cupertino, Calif.

But there’s more. In an exclusive interview with Fortune, Apple’s human resources chief Denise Young Smith said the company is partnering with several non-profit organizations on a multi-year, multi-million-dollar effort to increase the pipeline of women, minorities, and veterans in the technology industry—and, of course, at Apple.

[newsletter-the-brief]

“We wanted to create opportunities for minority candidates to get their first job at Apple,” said Young Smith, who took over as its head of HR a little over a year ago. (Before her current role, the longtime Apple exec spent a decade running recruiting for the retail side of the business.) “There is tremendous upside…

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New police radars can ‘see’ inside homes

Image:  Frank Pompa, USA Today

At least 50 U.S. law enforcement agencies have secretly equipped their officers with radar devices that allow them to effectively peer through the walls of houses to see whether anyone is inside, a practice raising new concerns about the extent of government surveillance.

Those agencies, including the FBI and the U.S. Marshals Service, began deploying the radar systems more than two years ago with little notice to the courts and no public disclosure of when or how they would be used. The technology raises legal and privacy issues because the U.S. Supreme Court has said officers generally cannot use high-tech sensors to tell them about the inside of a person’s house without first obtaining a search warrant.

The radars work like finely tuned motion detectors, using radio waves to zero in on movements as slight as human breathing from a distance of more than 50 feet. They can detect whether anyone is inside of a house, where they are and whether they are moving.

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FBI director wants access to encrypt Apple, Google users’ data, demands law ‘fix’

 

Reuters / Brendan McDermid
Image: Reuters / Brendan McDermid

The FBI director has slammed Apple and Google for offering their customers encryption technology that protects users’ privacy. “Deeply concerned” James Comey wants to push on Congress to “fix” laws to ensure police can still access private data.

“It’s the equivalent of a closet that can’t be opened. A safe that can’t be cracked,” Comey, speaking at the Brookings Institute in Washington DC, referred to the encryption technology calling the new service “a marketing pitch.”

“But it will have very serious consequences for law enforcement and national security agencies at all levels,” he warned.

Apple has recently presented its latest Mac OS X operating system for desktop and laptop computers, encouraging its customers to use FileVault disk encryption technology to keep their data secure. The tool would also prevent NSA or FBI from having access to phones and computers.

 More from Russia Today

Posted by The NON-Conformist

Silicon Valley Firms Are Even Whiter and More Male Than You Thought

After stalling for years, Google finally released data on the diversity of its workforce , admitting that the company is “miles from where want to be.” Lazlo Bock, Google’s senior vice president of people operations, noted that “being totally clear about the extent of the problem is a really important part of the solution,” adding that the company is supporting code education among historically underrepresented groups.

Image: Google

But those efforts may not be enough. Exclusive data obtained from the Labor Department by Mother Jones shows that top Silicon Valley tech firms lag far behind the general population in diversity, and that while Google is average in its recruitment of women, it has even fewer African-American and Latino employees than other major tech firms. More from Mother Jones

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