Quora Question: In What Ways Can China's Tech Industry Challenge Silicon Valley?

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People fly kites at a park in front of commercial towers, including the 115-story Ping An International Finance Centre, in Shenzhen, China August 3. Bobby Yip/Reuters

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Answer from Kynan Eng, brain-related research & commercialization at universities and startups.

In a very meaningful way, China's tech industry ISSilicon Valley. The vast majority of the world's computing hardware, of any type, is produced or assembled in and around Shenzhen.

This wasn't the case at the start of the consumer computing era. But as time went on during the '80s, '90s and '00s, the combination of low production costs and skilled workers in southern China proved to be an irresistible attraction for growing American computer companies. Now it's quite rare to see a computing hardware supply chain that does not pass through China.
Now, those manufacturing companies, formerly anonymous OEMs, have caught up in terms of industrial design and are producing under their own brands. The challenge for consumer mindshare is on. Chinese companies such as Xiaomi, OnePlus and Huawei are starting to have an international impact in smartphones. The world's largest drone company, DJI, is Chinese—and some of its products are subject to export restrictions. Until very recently, it was mainly the U.S. that was imposing the restrictions.
Where does Silicon Valley still rule supreme? In anything that doesn't involve hardware, and where social and/or cultural considerations are of critical importance. Web services such as Google, Facebook, LinkedIn etc. will be hard to dislodge, but they have had trouble establishing themselves in China due to both market acceptance and governmental hurdles. Chinese equivalents such as Weibo and Baidu cater almost exclusively to a (huge) local audience.

For now, web services seem to be in a deadlocked situation—Chinese web companies find it hard to go global, and Silicon Valley web companies often have big problems getting into China. There are big political stakes and national security interests involved with the massive repositories of data that these companies hold, adding further to the deadlock.

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